If a GST officer has passed an order confirming a demand against you, the first appeal goes to the Appellate Authority in Form GST APL-01, filed online within three months of the date the order was communicated. Before the appeal is accepted you must pay two things: the whole of whatever part of the demand you accept, and a pre-deposit of 10% of the tax still in dispute, capped at ₹20 crore under each Act. Interest and penalty linked to the disputed tax do not go into that 10%. Once the pre-deposit is paid, recovery of the rest of the demand is stayed while the appeal is pending.
The rules sit in section 107 of the CGST Act, 2017 and rule 108 of the CGST Rules. Two later changes catch people out: the cap fell from ₹25 crore to ₹20 crore in August 2024, and from 1 October 2025 an order that imposes only a penalty also needs a 10% deposit. The position below is as it stood on 25 October 2026.
Three months from communication, and one more month only for sufficient cause
Section 107(1) gives a person aggrieved by a decision or order of an adjudicating authority three months from the date the order is communicated to file the appeal. Section 107(4) lets the Appellate Authority admit an appeal filed within a further one month if the appellant shows sufficient cause for the delay. Beyond that four-month outer limit the Appellate Authority has no power under the Act to condone delay, so a late appeal usually ends up as a writ petition before the High Court.
The department has a longer window. Under section 107(2), the Commissioner may review an order and direct an officer to appeal within six months of its communication. That appeal is heard by the same authority.
Count from the date of communication, not the date printed on the order. For an order uploaded on the GST portal, that is normally the date it appears in your case folder. For an order served by post or by hand, keep the envelope or the acknowledgement of receipt. That date decides whether you are in time.
Who hears the first appeal
Rule 109A of the CGST Rules decides the forum by the rank of the officer who passed the order:
- An order of an Additional Commissioner or Joint Commissioner goes to the Commissioner (Appeals).
- An order of a Deputy Commissioner, Assistant Commissioner or Superintendent goes to an officer not below the rank of Joint Commissioner (Appeals).
For orders passed by State GST officers, the State GST Act and the State's own notifications name the appellate officer. The portal routes the APL-01 to the right authority once you pick the order, so the rank matters mainly when you are drafting the address and checking whether the officer who passed the order had the power to do so.
Working out the pre-deposit under section 107(6)
No appeal can be filed until the appellant has paid:
- in full, the amount of tax, interest, fine, fee and penalty arising from the order that the appellant admits; and
- a sum equal to 10% of "the remaining amount of tax in dispute arising from the said order", subject to a maximum of ₹20 crore.
Three points follow from that wording. The 10% is calculated on tax only, so a large interest or penalty figure in the order does not raise the deposit. The base is the tax you still dispute after taking out the admitted part, so splitting the order honestly into admitted and disputed portions lowers the deposit. And the ₹20 crore ceiling applies separately under the CGST Act and the State GST Act. The GST Council's recommendation that led to the cut, in the press release on the 53rd GST Council meeting of 22 June 2024, describes it as ₹20 crore CGST and ₹20 crore SGST. In practice the cap only bites where the disputed tax under one Act exceeds ₹200 crore.
Section 107(7) then gives the deemed stay: once the pre-deposit is paid, recovery proceedings for the balance are treated as stayed. If the officer still issues a recovery notice after you have filed APL-01 with the deposit, the appeal acknowledgement and the payment entries are your answer.
Illustration: a section 73 demand split into admitted and disputed parts
Take a trader in Pune whose section 73 order for FY 2022-23 is uploaded on the portal on 18 August 2026. The order confirms tax of ₹7,40,000 CGST and ₹7,40,000 SGST on ITC disallowances, with interest and a penalty of ₹74,000 under each Act. On review, the trader accepts that ₹90,000 CGST and ₹90,000 SGST of the disallowed credit relates to invoices the supplier never reported, and decides to fight the rest.
| Item | CGST | SGST | Total |
|---|---|---|---|
| Tax confirmed in the order | ₹7,40,000 | ₹7,40,000 | ₹14,80,000 |
| Tax admitted, paid in full | ₹90,000 | ₹90,000 | ₹1,80,000 |
| Tax still in dispute | ₹6,50,000 | ₹6,50,000 | ₹13,00,000 |
| Pre-deposit at 10% of disputed tax | ₹65,000 | ₹65,000 | ₹1,30,000 |
The trader also pays the interest and penalty that go with the admitted ₹1,80,000 (say ₹62,000 of interest and ₹18,000 of penalty), because section 107(6)(a) covers every admitted component, not only tax. The cash needed before filing is therefore ₹1,80,000 + ₹62,000 + ₹18,000 + ₹1,30,000, which is ₹3,90,000. The disputed interest and the penalty of ₹1,30,000 on the disputed tax add nothing to the deposit. Three months from 18 August 2026 runs to the middle of November 2026; the extra month under section 107(4) is a fallback that depends on the Appellate Authority accepting the reason for delay.
Orders that impose only a penalty
Until 30 September 2025, section 107(6) had no percentage deposit for a penalty-only order, except for detention and seizure orders under section 129(3), which needed 25% of the penalty. The Finance Act, 2025 replaced that proviso. The substituted proviso says that where an order demands penalty without involving any demand of tax, no appeal can be filed unless 10% of that penalty has been paid. The amendment took effect on 1 October 2025 under Notification No. 16/2025-Central Tax dated 17 September 2025.
So a penalty of ₹2,50,000 under section 122 with no tax demand needs ₹25,000 before APL-01 can be filed, and a section 129(3) detention penalty now needs 10% instead of 25%.
Which orders the new proviso reaches is being litigated. On 13 October 2026, in Hans Raj Kaushik v. Union of India, the Delhi High Court extended the benefit of its earlier Gaurav Jain ruling to a penalty-only order arising from a show cause notice issued before the amendment. The reasoning is set out in the report on the Delhi High Court ruling on penalty-only pre-deposits. Other High Courts have not all ruled on the point, so for a notice dated before 1 October 2025 outside Delhi, check the position in your own High Court before deciding not to pay.
Filing Form APL-01 on the GST portal
Rule 108 of the CGST Rules requires the appeal to be filed electronically in APL-01, with the grounds of appeal and supporting documents. Manual filing is allowed only where the Commissioner has notified it or the order is not available on the portal. The sequence on the portal:
- Log in and go to Services, then User Services, then My Applications, and choose the appeal application type. Select the order you are appealing; the order number and demand are picked up from the case.
- Split the demand into admitted and disputed amounts for each head (tax, interest, penalty, fee, others) under each Act. These figures drive the pre-deposit.
- Pay the admitted amount and the pre-deposit. The portal debits your ledgers at filing; the difference between the cash ledger, credit ledger and liability register matters here because the debit entries are your proof of payment.
- Upload the grounds of appeal, the statement of facts and the supporting documents. GSTN's APL-01 FAQ on the GST portal allows PDF or JPEG files of up to 5 MB each, and says a digital signature is mandatory for companies and LLPs; others may verify with EVC.
- Submit. A provisional acknowledgement is generated at once. Where the order is on the portal, the Appellate Authority later issues the final acknowledgement in APL-02 with an appeal number, and the date of the provisional acknowledgement counts as the filing date.
Where the order is not on the portal, rule 108(3) requires a self-certified copy of it within seven days of filing APL-01. If you miss the seven days, the appeal is treated as filed on the date the copy is submitted, which can push it outside the limitation period.
Two portal problems seen in 2026
The ICSI GST newsletter for April 2026 reports two GSTN advisories. From 6 April 2026 the pre-deposit percentage in APL-01, earlier fixed at 10%, can be edited, so that amounts already paid can be adjusted; the Appellate Authority then verifies the payment. A taxpayer who paid at the notice stage may also find APL-01 blocked because the order shows a nil demand. The fix suggested is a rectification request to the officer who passed the order so that the disputed amount appears correctly, and then the appeal.
If you paid some or all of the disputed amount earlier through DRC-03, link that payment to the demand through DRC-03A before claiming it against the pre-deposit; how DRC-03 payments are made and mapped explains the steps.
Hearing, decision and the Appellate Authority's limits
Section 107(8) entitles the appellant to be heard. Adjournments are possible for sufficient cause, but section 107(9) allows no more than three to a party. Under section 107(10) you may raise a ground not taken in the APL-01 if the authority is satisfied that leaving it out was not wilful or unreasonable, but drafting the grounds fully at the start is safer.
The Appellate Authority can confirm, modify or annul the order but cannot send it back to the adjudicating officer (section 107(11)). It can also make things worse for you. Before increasing a penalty or fee, or reducing a refund or credit, it must give you a chance to show cause. Before raising tax not demanded in the order, it must issue a notice within the time limits of sections 73, 74 or 74A. Section 107(13) asks it to decide each appeal within one year where possible.
If the order goes in your favour, the pre-deposit linked to the amount dropped becomes refundable. The Bombay High Court's IBM India ruling on refund of pre-deposit after part of a demand was set aside held that the department cannot hold back that part only because the rest is still being contested.
Second appeal to the GST Appellate Tribunal
If the first appeal fails, section 112 of the CGST Act provides the next step to the GST Appellate Tribunal (GSTAT). The appeal lies within three months of communication of the appellate order, and the Tribunal may admit it within a further three months for sufficient cause. It may also decline to admit an appeal where the tax, fine, fee or penalty involved does not exceed ₹50,000.
| Stage | Time limit | Pre-deposit on disputed tax | Penalty-only order |
|---|---|---|---|
| First appeal, section 107 | 3 months, plus 1 month for sufficient cause | 10%, maximum ₹20 crore under each Act | 10% of the penalty |
| Second appeal to GSTAT, section 112 | 3 months, plus 3 months for sufficient cause | A further 10%, maximum ₹20 crore | A further 10% of the penalty |
In the Pune illustration, a tribunal appeal on the full ₹13,00,000 of disputed tax would need another ₹1,30,000, taking the total pre-deposit to ₹2,60,000, or 20% of the disputed tax across both stages.
When APL-01 is the wrong remedy
An appeal under section 107 is meant for orders on merits. Some situations have a different first step:
- A registration cancelled for non-filing of returns can often be restored through a revocation application in REG-21 rather than an appeal; how suspension, cancellation and revocation work covers when each route applies. An order rejecting revocation can then be appealed in APL-01.
- An error apparent on the face of the order, such as a wrong figure carried from the notice, is usually fixed faster through a rectification request to the officer who passed it. That is also the route GSTN suggests where a nil demand blocks APL-01.
- An order passed without a hearing, beyond the time limit or by an officer without jurisdiction may still be appealed. These defects are also the grounds on which High Courts entertain writ petitions, and the deadline for APL-01 keeps running while you decide.
Whichever route you choose, diarise the three-month date from the day the order reached you. Keep the ledger debit entries for the admitted amount and the pre-deposit with the appeal file, because the Appellate Authority verifies those payments before it takes up the appeal.
