Voluntary tax payment during search without contemporaneous protest precludes claims of coercive recovery and subsequent refund.

The petitioner manages a coaching institute, "Alpha-1 Tuition Classes and Hostel," which provides services to primary students

Between October 6 and 10, 2023, GST authorities conducted a search under Section 67(2) of the Gujarat Goods and Services Tax (GST) Act, 2017

The authorities discovered that the petitioner was operating without GST registration and collecting fees partly in cash

During the search, the petitioner signed an undertaking admitting liability and consented to a temporary registration to pay the tax

Consequently, he paid ₹1,96,25,330 towards tax, interest, and penalty

Nearly two years later, on August 28, 2025, the petitioner applied for a refund (Form GST RFD-01), alleging the payment was made under duress and coercion

The respondent rejected the refund claim on February 3, 2026, after issuing a show-cause notice and conducting a hearing

1. Whether the payment of tax made during the search proceedings was voluntary or recovered through coercion and threat

2. Whether the delay in issuing Form GST DRC-04 (acknowledgment of voluntary payment) and the lack of a notice under Section 73 or 74 invalidated the retention of the tax amount

3. Whether the High Court should exercise its writ jurisdiction under Article 226 when an alternative remedy (Section 107 appeal) is available and the case involves disputed questions of fact

Section 74(8) of the GST Act, which stipulates that if a person chargeable with tax pays the tax, interest, and penalty within 30 days of notice (or voluntarily), proceedings are deemed concluded

Section 54 regarding the procedure and eligibility for tax refunds

Rule 142 concerning Form DRC-04

The court relied on the principle from Innovators Facade Systems Ltd. v. Asst. Addl. Director General of GST Investigation, holding that bare allegations of coercion without contemporaneous complaints (police or superior authorities) are treated as afterthoughts and involve disputed facts unsuitable for Article 226

The court found no evidence of coercion in the record; conversely, the panchnama and the petitioner’s recorded statement in a "question and answer" format showed a voluntary admission of operating without registration and a willingness to pay to "buy peace"

The court emphasized the petitioner’s conduct: he remained silent for two years before alleging duress, which a "prudent legal person" would have reported immediately

Regarding procedural lapses, the court held that since the petitioner voluntarily quantified and paid his liability based on seized data, the proceedings were concluded under Section 74(8), making a formal Section 73/74 notice unnecessary

The delay in issuing Form DRC-04 was deemed non-prejudicial as the Rules prescribe no specific time limit and the underlying liability was undisputed for two years

The court ruled that disputed factual claims of "coercive recovery" cannot be adjudicated under Article 226, especially when the petitioner bypassed the statutory appellate remedy under Section 107. The petition was rejected on merits as requested by the petitioner's counsel