M/S Nector Foods Private Limited, Through Its Director Sh. Apoorv Agarwal vs. The Union Of INDIA, Through The Secretary, Department Of Revenue, Ministry Of Finance & Ors.
Original PDF →Facts
The Petitioner, M/s Nector Foods Private Limited, filed a writ petition before the Delhi High Court seeking a declaration that two GST DRC-03 debits totaling Rs. 28,34,294, made on July 30, 2025, were coerced and involuntary. The Petitioner sought quashing of the recovery and retention of interest and penalty, and a direction for refund of the amount to their bank account. The payments were made during a search of the Petitioner's premises. The Petitioner admitted that payments of Rs. 67,20,000 and Rs. 4,53,628 were voluntary, but claimed the remaining Rs. 26,55,050 was made under coercion. The Respondents contended that all payments were voluntary and no coercion was applied by the search team. The Respondents also stated that an investigation against the Petitioner was pending.
Held
The Court held that the question of whether the payment of Rs. 26,55,050/- was made voluntarily or under coercion involves a disputed question of fact. This was particularly noted because the Petitioner did not dispute the voluntary nature of the other two payments made during the same search proceedings. Given this disputed factual matrix, the Court was not inclined to issue a writ directing the refund of the amount claimed by the Petitioner. The Court observed that the Petitioner, if advised, could avail of alternative remedies available in law. The Writ Petition was disposed of with these observations. The Court did not address the Petitioner's prayer for CCTV installation.
Key Issues
1. Whether the payment of Rs. 26,55,050/- made by the Petitioner on July 30, 2025, was voluntary or made under coercion, in violation of Instruction No.01/2022-23 (GST-Investigation)? Petitioner's argument: The Petitioner argued that the payment of Rs. 26,55,050/- was coerced and involuntary, made during the search of their premises. They relied on the fact that the payments were made at odd hours (4:19 AM and 4:29 AM) and sought a refund. They also sought directions for CCTV installation in interrogation areas as per *Paramvir Singh Saini v Baljit Singh*. Respondents' argument: The Respondents contended that all payments, including the disputed amount, were made voluntarily and that there was no coercion by the search team. They also submitted that the investigation against the Petitioner was pending and likely to conclude shortly.
Sections Cited
Section 73, Section 74
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R %
2026
Through this Writ Petition, the Petitioner prays for the following reliefs: “(a) DECLARE that the two Form GST DRC-03 debits dated 30.07.2025 (ARN AD070725024398T and ARN AD070725024402C) were coerced and involuntary. Issue a Writ of Certiorari or any other appropriate writ, order or direction QUASHING the recovery and retention of the interest and penalty of Rs.28,34,294 effected thereby. (b) Issue a Writ of Mandamus or any other appropriate writ, order or direction DIRECTING Respondent Nos. 1 to 3 to refund Rs. 28,34,294 to the Petitioner's bank account (HDFC Bank, Account No. 50200077563997, IFSC HDFC0000090), and not by re-credit to any electronic ledger. The refund to be independent of, and not conditioned upon, any pending or future investigation or proceeding. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 22/08/2026 at 10:40:51
(c)DIRECT payment of interest on the said sum from 30.07.2025 till realisation, at not less than 6 percent per annum, rising to 12 percent per annum should payment not be made within the period this Hon'ble Court fixes. (d)DIRECT the installation of CCTV and audio-video recording in the interrogation areas of the Respondent Commissionerate, in terms of Paramvir Singh Saini v Baljit Singh, (2021) 1 SCC 184, with night vision and audio as well as video capability, and preservation of recordings as therein directed. DIRECT that copies of such recordings be furnished to the assessee upon request, for use in any proceeding before a court of competent juri iction. …”
In substance, the Petitioner claims that he was compelled to make payments amounting to Rs.28,34,294/- (together with interest) during the search of his premises and that such payments were made in violation of Instruction No.01/2022-23 (GST-Investigation) dated 25.05.2022 issued by the Commissioner (GST-Inv.), CBIC.
In Paragraph No.8 of the Writ Petition (Page No.21 of the paper book), the Petitioner has disclosed the following payments made during the search of his premises:
THE DAWN DEBITS. At 04:19 and 04:29 AM on 30.07.2025, while the officers remained present on the premises, two Forms GST DRC-03 were debited from the Petitioner's Electronic Cash Ledger (Annexure P-4). Their composition is as follows:
Form GST DRC-03 Tax Interest Penalty Amount claimed Section ARN AD07072502 42951 (29.07.2025, 6:29 PM) 67,20,000 (not claimed)
Nil
Nil
Nil
73(5) ARN AD07072502 4398T (30.07.2025, 4:19 AM)
Nil
16,47,050
10,08,000
26,55,050
74(5) ARN AD07072502 4402C
4,53,628 (not 1,11,200
68,044
1,79,244
74(5) This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 22/08/2026 at 10:40:51
(30.07.2025, 4:29 AM) claimed) Total
28,34,294
Learned counsel representing the Petitioner admits that the payments of Rs.67,20,000/- and Rs.4,53,628/- are not being claimed, as these payments were made voluntarily. However, it is submitted that the payment of Rs.26,55,050/- was made involuntarily.
Learned counsel representing the Respondents submits that all the payments were made voluntarily and that there was no coercion on the part of the members of the search team.
It is further contended that the investigation against the Petitioner is pending and the matter is likely to be concluded shortly.
In the facts of the present case, whether the payment of Rs.26,55,050/- was made voluntarily or under coercion involves a disputed question of fact. This is particularly so when the Petitioner does not dispute the voluntary nature of the other two payments made during the very same search proceedings.
In these circumstances, this Court is not inclined to issue a writ directing refund of the amount claimed by the Petitioner. The Petitioner, if so advised, may avail such alternative remedy as may be available to him in law.
With these observations, the present Writ Petition is disposed of.
All the pending applications are also closed.
ANIL KSHETARPAL, J.
SHAIL JAIN, J. AUGUST 20, 2026/sp/shah This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 22/08/2026 at 10:40:51
Reproduced from the public record of the Delhi High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.