Registration surrender and merger of excise units depend on discharge of dues and express statutory authority.

A registration surrender may be accepted where no central excise dues remain outstanding against the concerned premises, and refusal to accept surrender without any material showing pending liability is unsustainable. The surrender of Unit No. II was therefore rightly accepted. By contrast, the Central Excise Act and rules did not confer power to direct merger of two registered units, and administrative board directions could not create such statutory authority. The merger direction for Unit No. II with Unit No. I was therefore not sustainable. Relief was accordingly only partly in favour of the assessee.

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Issues: (i) Whether surrender of the registration for Unit No. II could be accepted when no central excise dues were shown to be outstanding against that unit; (ii) Whether the Central Excise authorities had power to order merger of the registered premises of Unit No. II with Unit No. I.

Issue (i): Whether surrender of the registration for Unit No. II could be accepted when no central excise dues were shown to be outstanding against that unit.

Analysis: Surrender of a registration can be accepted once the liabilities attached to that registered premises stand discharged. No material was produced to show any pending dues against Unit No. II. The basis for refusing surrender was therefore not sustainable.

Conclusion: The surrender of registration for Unit No. II was rightly accepted.

Issue (ii): Whether the Central Excise authorities had power to order merger of the registered premises of Unit No. II with Unit No. I.

Analysis: No provision in the Central Excise Act or the rules empowered the authority to direct merger of two registered units in the manner ordered. Administrative orders of the Board permitting one licence or registration for adjacent units could not be treated as conferring a power to order merger under the statute.

Conclusion: The direction permitting merger of Unit No. II with Unit No. I was not sustainable.

Final Conclusion: The decision sustains acceptance of surrender of registration but rejects the merger direction for want of statutory support, leaving the relief only partly in favour of the assessee.

Ratio Decidendi: A registration surrender may be accepted where no excise dues remain against the concerned premises, but merger of registered units cannot be ordered unless expressly authorised by the governing statute or rules.

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