Tax appeal withdrawal cannot defeat statutory duty to decide on merits; void dismissal for non-prosecution was quashed.

An assessee who has filed a tax appeal cannot unilaterally withdraw it to prevent the appellate authority from deciding the matter on merits, because statutory jurisdiction cannot be conferred by consent and there is no estoppel against a statute. The Tribunal therefore lacked jurisdiction to permit withdrawal of the appeal or to dismiss it for non-prosecution, and that order was invalid. Delay in seeking restoration or in approaching writ court did not bar relief where the interval was explained by the managing director's serious illness and the medical material was accepted. The impugned order was quashed and the appeal was directed to be heard on merits.

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Issues: (i) Whether the Appellate Tribunal had jurisdiction to permit withdrawal of an income-tax appeal and dismiss it for non-prosecution; (ii) Whether the delay in seeking restoration of the appeal before the Tribunal or in approaching the writ court barred relief.

Issue (i): Whether the Appellate Tribunal had jurisdiction to permit withdrawal of an income-tax appeal and dismiss it for non-prosecution.

Analysis: The appeal related to penalty proceedings arising out of an assessment made under the earlier Income-tax Act, 1922, but the penalty was imposed under the Income-tax Act, 1961. The controlling principle applied was that an assessee, having filed an appeal under the tax statute, cannot withdraw it so as to prevent the appellate authority from discharging its statutory duty. The appellate authority is required to dispose of the appeal on merits. Since jurisdiction cannot be conferred by consent and there is no estoppel against a statute, the Tribunal could not validate an otherwise unauthorised course merely because the assessee itself sought withdrawal.

Conclusion: The Tribunal had no jurisdiction to allow withdrawal of the appeal or to dismiss it for non-prosecution, and the order was invalid.

Issue (ii): Whether the delay in seeking restoration of the appeal before the Tribunal or in approaching the writ court barred relief.

Analysis: The delay was explained by the serious illness of the company's managing director, and the medical material was accepted. The circumstances were treated as sufficient to explain the interval before the restoration application and the writ petition. The Tribunal's refusal to recall its order was upheld only to the extent that it lacked jurisdiction to do so, but the delay did not defeat the challenge to the void order.

Conclusion: The delay did not bar relief.

Final Conclusion: The impugned withdrawal-and-dismissal order was quashed, the appeal was treated as still pending, and the Tribunal was directed to hear and decide the appeal on merits after giving the assessee an opportunity of being heard.

Ratio Decidendi: In tax appellate proceedings, an assessee cannot unilaterally withdraw a duly filed appeal so as to prevent decision on merits, and an appellate order permitting such withdrawal is void for want of jurisdiction because statutory authority cannot be displaced by consent or estoppel.

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