2025-VIL-1166-KAR
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SGST High Court Cases

GST – Voluntary Payment or Payments under duress and coercion during inspection proceedings – Petitioner seeking refund of amount paid under duress during inspection proceedings by GST Intelligence and Anti-Evasion officers – Rejection of refund applications on the ground of deficiencies in the applications in so far as failure to submit any documents substantiating the claims that the payments have been made under coercion or under duress - Whether the payments made by the petitioner during the inspection proceedings can be considered as voluntary payments under Section 74(5) of the CGST Act, 2017 - HELD - The Refund applications submitted by the petitioner seeking refund were in tune with what is necessary as all the documents are placed on record by the petitioner. Therefore, the applications ought to have merited appropriate consideration at the hands of the respondents – Further, in the light of the judgments rendered by the Apex Court and different High Courts, the payments made by the petitioner cannot be construed as voluntary under Section 74(5) of the CGST Act - The recovery of taxes during investigation without adjudication was contrary to law and in violation of the Constitution. The petitioner had claimed the payments were made under duress and threat of adverse consequences. The respondents have failed to establish that the payments were voluntary self-ascertainment by the petitioner - The petitioner is entitled to a refund of the payments made as they were not voluntary under Section 74(5) of the Act - The deficiency memos issued by the respondents are quashed and the Respondents are directed to process the petitioner's refund applications in accordance with law – The writ petition is allowed
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