Central Excise de-registration cannot be refused merely because a duty notice is pending after business cessation.

Where a registered Central Excise assessee had ceased manufacturing, filed the prescribed declaration, surrendered the registration certificate and undertook to meet any confirmed future liability, de-registration could not be refused merely because a duty demand was still at the show cause notice stage. Rule 9 of the Central Excise Rules, 2002 read with Notification No. 35/2001-CE(NT) did not create a separate ground to deny surrender in the absence of any confirmed demand. The existence of a new registration for the same premises also supported cancellation of the earlier registration.

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Issues: Whether surrender and de-registration of Central Excise registration could be denied merely because a show cause notice for duty demand was pending, when the assessee had ceased manufacturing activity and complied with the prescribed procedure.

Analysis: Rule 9 of the Central Excise Rules, 2002 read with Notification No. 35/2001-CE(NT) required a registered person who ceased to carry on the registered activity to file the declaration in Annexure III and deposit the registration certificate. The assessee had stopped manufacturing long before, filed the prescribed declaration, disclosed the pending notice, and submitted an undertaking to discharge future liability if any demand was confirmed. The pending matter had not resulted in any confirmed duty demand, and the notification did not create a ground to refuse de-registration merely because a show cause notice was pending. The existence of a new registration for the same premises also supported cancellation of the earlier registration.

Conclusion: The refusal to de-register was unsustainable and the surrender of registration was rightly accepted, in favour of the assessee.

Ratio Decidendi: Where the prescribed declaration and surrender formalities under the registration notification are completed after cessation of business, de-registration cannot be refused solely because a duty demand is at the show cause notice stage and no confirmed demand exists.

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