Property attachment must track only surviving tax demand; excess recovery action and related attachments cannot be sustained.

Recovery proceedings and property attachments cannot continue beyond the extent of the enforceable outstanding tax demand. Where appellate relief has substantially reduced the demand and part of the liability is stayed, the Tax Recovery Certificates must be revised to reflect only the surviving unrecovered amount. On the facts, attachment over two properties was quashed because the wider recovery action was no longer supported by the reduced demand, while one property could remain attached as security for the limited subsisting liability. The court thus preserved attachment only to the extent necessary to protect the Revenue against the non-stayed demand.

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Issues: Whether the Tax Recovery Certificates and attachments of the petitioner's properties could be sustained in view of the reduction and partial extinction of the underlying tax demand, and to what extent the attached properties were liable to be released or continued under the surviving demand.

Analysis: The demand for two assessment years had substantially ceased to survive after appellate relief, while the remaining enforceable demand was limited to the quantum interest component for one assessment year and a separate penalty demand stayed by the Principal Commissioner. The Revenue accepted the current demand position and sought retention of one property only, whereas the petitioner offered continued attachment of the property whose market value was sufficient to secure the surviving unrecovered demand. On these facts, the continued attachment of all three properties was found unsustainable, but one property could remain attached to protect the Revenue in respect of the outstanding non-stayed demand.

Conclusion: The attachment over two properties was quashed and set aside, the third property was permitted to remain attached for the surviving demand, and the Tax Recovery Certificates were directed to be revised to reflect only the unrecovered demand not covered by stay.

Final Conclusion: The writ petition succeeded to the extent of releasing two attached properties while preserving one attachment as security for the limited subsisting tax liability, with consequential revision of the recovery certificates.

Ratio Decidendi: Recovery proceedings and attachments cannot continue beyond the extent of the enforceable outstanding demand, and where the surviving liability is limited, attachment may be retained only to the extent necessary to secure that liability.

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