2008 (3) TMI 96 - AT - Central Excise

Commissioner (A) is not justified in refusing to issue registration to the appellant for the reason that the registration of the previous occupier of the premises had not been cancelled - Revenue does not stand to suffer by allowing another person to operate from the premises after canceling the registration surrendered by the predecessor registrant - Failure to pay confirmed dues only can be held as a ground not to register the premises in the name of another person registration not deniable

Summary

Issues:
1. Refusal of registration to the appellant due to pending demands against the predecessor registrant.
2. Interpretation of rules regarding surrender of registration and issuance of registration certificates.
3. Legal implications of pending show-cause notices on registration application.

Analysis:
1. The appellant, M/s. Saradhambal Steel India Pvt. Ltd., filed an appeal against the refusal of registration by the lower authorities, citing pending demands against the previous occupier, M/s. Gowri Steel Rolling Mills (GSRM). The Commissioner (Appeals) upheld the decision based on the Bombay High Court judgment that registration for a premises could only be issued to one person at a time. The appellant offered a joint undertaking with GSRM to secure any confirmed dues, but this was deemed inadequate for de-registration. The appellant argued that confirmed dues were necessary to deny registration to a new occupier.

2. The appellant relied on a judgment of the Andhra Pradesh High Court in Modi RJR Ltd. Vs Commissioner of Central Excise, emphasizing that registration cannot be denied based on arrears of the predecessor. The appellant contended that the extant provisions were similar to those considered by the High Court. The Tribunal found that the lower authorities had no statutory provisions to deny registration to the appellant, especially when the department had not progressed in deciding the demand notices issued to GSRM for nearly 10 years. The Tribunal referenced the Andhra Pradesh High Court's observation that registration cannot be declined based solely on arrears of the predecessor.

3. The Tribunal considered the legal aspects of surrendering registration and the issuance of registration certificates. It noted that the authorities cannot decline registration without quantifying arrears or considering dues of the predecessor. The Tribunal emphasized that failure to pay confirmed dues could be a valid ground for denying registration. It concluded that there was nothing in the statute to decline registration to the appellant, especially when the property would still be available to the Revenue for recovering any confirmed dues. The Tribunal allowed the appeal, directing GSRM to resubmit the application for surrendering registration and the Deputy Commissioner to issue registration to the appellant within six weeks if admissible.