Recovery proceedings fail when the underlying assessment is quashed and no legal foundation remains for enforcement.

Recovery proceedings cannot be sustained where the assessment forming their foundation has already been quashed. The Bombay High Court noted that once the underlying assessment order was set aside and further recovery steps pursuant to it were directed not to be taken, the demand lost its legal basis. In such circumstances, enforcement of the recovery notice against the petitioner could not continue because the demand depended entirely on a non-existent assessment.

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Issues: Whether recovery could be pursued against the petitioner in respect of a demand founded on an assessment that had already been quashed.

Analysis: The assessment on the basis of which the demand was raised had been set aside by the Court, and further recovery steps pursuant to that assessment were directed not to be taken. Once the foundation of the demand no longer survived, no recovery could be sustained against the petitioner on that quashed assessment order.

Conclusion: The recovery notice could not be enforced against the petitioner and the writ petition succeeded.

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