I know there is a "gun" of sorts divers use to fend off sharks. It fires a 12 gauge shotgun shell when the head hits something relatively hard. I would worry about the barrel splitting due to the build up of water pressure as it (the bullet) makes its way up the barrel.. not something I would want to test myself.
I believe you are thinking of a bang stick. If so, there really is no "barrel" to speak of. For more info, try:
http://en.wikipedia.org/wiki/Powerhead