If I allocate some or all of my merits to a person I feel that they deserve it and that they should rank up, is it really fine if I do it like that way?
About all of your sMerits in one go (assuming they are between 20-40), I would say no.
About some of them, yes, if:
1. The user is in a rank where he requires a few more Merits to rank up, and the post in question deserves to get that many Merits.
2. You are not showering him with Merits for only that particular post and passing him to the next tier, but you are sure of his post history being constantly constructive.