The First Appeal Hearing and Order: APL-04

Once the final acknowledgement issues, the appeal waits in the Appellate Authority’s queue. What follows is governed by a few sub-sections that are easy to misread. The appellant has a right to be heard, but only three adjournments. New evidence is admitted only on conditions. The Appellate Authority must decide the case itself rather than send it back. It may make the appellant’s position worse, but only after notice. And it is to decide within a year, “where it is possible to do so”. The order ends with a one-page summary, FORM GST APL-04, and the demand in the electronic liability register moves to match it.

This guide covers section 107(8) to (16), rules 112 and 113 of the CGST Rules, and the portal’s case folder for first appeals. Filing is covered in Filing a First Appeal: APL-01, and the payment and stay in Pre-Deposit, and the Stay of Recovery.

The right to be heard

Section 107(8): “The Appellate Authority shall give an opportunity to the appellant of being heard.” APL-01 asks at item 10 whether the appellant wishes to be heard in person. The portal’s FAQ describes the sequence. The Appellate Authority verifies the appeal and admits or rejects it, then “will issue a date of hearing”, and after “such inquiry as may be necessary” passes the order.

Notices from the Appellate Authority appear in the case folder on the portal. The portal’s manual on “Filing Reply and Rectification Request During First Appeal Proceeding” describes the route: Services > User Services > View Additional Notices/Orders, then the case’s Case Details screen, which has six tabs:

• APPLICATIONS: the appeal as filed, the order appealed and the supporting documents
• NOTICES: show cause, personal hearing and adjournment notices, each with a Reply link
• REPLIES: replies filed by the appellant and by tax officials; a counter-reply is filed from here
• ORDERS: admission or rejection, the appeal order and any rectification order
• RECTIFICATION: rectification requests and their outcome
• ADDITIONAL DOCUMENT: documents handed in at the hearing and uploaded by the officer

A reply is prepared offline and uploaded, with any supporting documents, then verified and filed with DSC or EVC. The portal issues a reply reference number by email and SMS. The status changes to “Reply Submitted”.

Adjournments: three per party

Section 107(9) allows the Appellate Authority, “if sufficient cause is shown at any stage of hearing of an appeal”, to adjourn “for reasons to be recorded in writing”. The proviso limits it: “no such adjournment shall be granted more than three times to a party during hearing of the appeal”. The limit applies to each party, the department included. The portal’s FAQ adds that “Adjournment on account of administrative grounds cannot be counted”, meaning adjournments the authority itself needs.

New grounds and new evidence

New grounds. Under section 107(10), the Appellate Authority “may … allow an appellant to add any ground of appeal not specified in the grounds of appeal, if it is satisfied that the omission of that ground from the grounds of appeal was not wilful or unreasonable”.

New evidence. Rule 112(1) is the restriction. The appellant may not produce “any evidence, whether oral or documentary, other than the evidence produced by him during the course of the proceedings before the adjudicating authority”, except where:

• (a) the adjudicating authority “refused to admit evidence which ought to have been admitted”
• (b) the appellant “was prevented by sufficient cause from producing the evidence which he was called upon to produce”
• © the appellant “was prevented by sufficient cause from producing … any evidence which is relevant to any ground of appeal”
• (d) the order was made “without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal”

Two safeguards follow. No evidence is admitted unless the Appellate Authority “records in writing the reasons for its admission” (rule 112(2)). And it may not take the evidence unless the adjudicating authority has had “a reasonable opportunity” to examine it, cross-examine any witness or produce rebuttal evidence (rule 112(3)). Rule 112(4) preserves the Appellate Authority’s own power to call for documents or witnesses “to enable it to dispose of the appeal”.

The four exceptions cover the common cases: an ex parte order, a hearing that was never given, or documents that were tendered and refused. An appeal that relies on new documents is easier to follow if it says which exception applies and why.

No remand

Section 107(11) sets the Appellate Authority’s powers:

The Appellate Authority shall, after making such further inquiry as may be necessary, pass such order, as it thinks just and proper, confirming, modifying or annulling the decision or order appealed against but shall not refer the case back to the adjudicating authority that passed the said decision or order.

The Appellate Authority must decide. It cannot fault the adjudicating authority for not examining something and stop there.

Kunal Autotech Pvt Ltd v Union of India (Delhi High Court, W.P.© 9760/2024, 19 September 2024) shows the point. The adjudicating authority had allowed most of an export refund, relying on the company’s reconciliation of GSTR-2B and GSTR-3B. On the department’s appeal, the Appellate Authority held that the adjudicating authority had placed reliance on the reconciliation “without sufficient discussion”, and disallowed Rs 12,04,443. It did not itself examine the reconciliation. The High Court held that “in terms of Section 107(11) of the CGST Act, the appellate authority is required to decide the question in issue and cannot remand the matter”. Having faulted the adjudicating authority for not addressing the reconciliation, the Appellate Authority “has also not addressed the same”. The order was set aside and the appeal sent back to the Appellate Authority.

The bar binds the Appellate Authority, not a court. In M/s Hirepro Consulting Pvt Ltd v Assistant Commissioner (Karnataka High Court, W.P. No. 4357 of 2022, 27 November 2025), the company had asked the Appellate Authority to remand twelve partly rejected refund claims so that it could produce SEZ-endorsed invoices. The Appellate Authority dismissed the appeal, holding that section 107(11) gave it no power to remand. The High Court noted that “the Appellate Authority is not entitled/empowered to remand the matter back to the Adjudicating Authority”. It exercised its own writ jurisdiction to set aside both orders and remit the claims to the adjudicating authority, with liberty to produce the documents.

Read together, the two cases mean that an appellant seeking reconsideration of evidence asks the Appellate Authority to admit and decide it under rule 112, not to remand. A request for remand alone invites dismissal.

Orders that make things worse

The Appellate Authority can enhance as well as reduce, but the first and second provisos to section 107(11) attach conditions.

• An order “enhancing any fee or penalty or fine in lieu of confiscation or confiscating goods of greater value or reducing the amount of refund or input tax credit” needs “a reasonable opportunity of showing cause against the proposed order”.
• Where the Appellate Authority finds tax unpaid, short-paid or erroneously refunded, or credit wrongly availed or utilised, no order to pay it may be passed unless the appellant “is given notice to show cause against the proposed order and the order is passed within the time limit specified under section 73 or section 74 or section 74A”.

A show cause notice from the Appellate Authority therefore signals a possible enhancement. The portal shows it in the NOTICES tab with the status “Show Cause Notice Issued”. It also ends the appellant’s right to withdraw. Under rule 109C, withdrawal is available only “before issuance of show cause notice under sub-section (11) of section 107 or before issuance of the order”, whichever is earlier.

The one-year time limit

Section 107(13): “The Appellate Authority shall, where it is possible to do so, hear and decide every appeal within a period of one year from the date on which it is filed.” A proviso excludes any period during which “the issuance of order is stayed by an order of a court or Tribunal”.

The words “where it is possible to do so” make this a direction to the Appellate Authority, not a time bar. An appeal does not lapse, and is not deemed allowed, when the year passes. Meanwhile the stay of recovery under section 107(7) continues while the appeal is pending. The year runs from filing, which under rule 108 means the date fixed by the final acknowledgement in APL-02.

The order and its summary

Section 107(12) requires the order to be “in writing” and to “state the points for determination, the decision thereon and the reasons for such decision”. Under section 107(14) and (15), it is communicated to the appellant, the respondent, the adjudicating authority and the jurisdictional central and State Commissioners.

Rule 113(1) requires the Appellate Authority to issue, with the order, “a summary of the order in FORM GST APL-04 clearly indicating the final amount of demand confirmed”. APL-04 records:

• the order appealed against and the appeal number
• the personal hearing and the “Order in brief”
• the status: “Confirmed / Modified / Rejected”
• for each of central, State or UT, and integrated tax and cess, the “Amount in dispute / earlier order” against the “Determined Amount”, for tax, interest, penalty, fees, others and refund
• a place-of-supply break-up for any IGST demand

The same form is used for revision orders (rule 109B), and by the jurisdictional officer for a demand confirmed by the High Court or the Supreme Court (rule 115). The Tribunal uses its own summary, FORM GST APL-04A, from 22 September 2025.

What the order does to the demand

Rule 85(5): “Any amount of demand debited in the electronic liability register shall stand reduced to the extent of relief given by the appellate authority or Appellate Tribunal or court and the electronic tax liability register shall be credited accordingly.” The APL-04 figures replace the original demand in Part II of the liability register.

• Appeal allowed in full. The demand is reduced to nil. The pre-deposit becomes refundable with interest under section 115. See Getting the Pre-Deposit Back.
• Appeal allowed in part. The demand stands at the determined amount. Amounts already paid, including the pre-deposit, count against it.
• Appeal dismissed. The demand stands. Section 107(7) stayed recovery because an appeal was pending; with the appeal decided, nothing in it protects the confirmed balance. Recovery of the balance may proceed unless a further appeal is filed with the Tribunal pre-deposit, which brings a fresh stay under section 112(9). Under section 84, recovery continues “from the stage at which such proceedings stood” before the appeal. See Recovery, and Paying in Instalments.
• Fraud not established. Where the Appellate Authority holds that a section 74 charge of fraud or suppression is not made out, section 75(2) redetermines the demand under section 73. See The Order, Rectification, and the Clock for Appeal.

Correcting the appeal order

An error apparent on the face of the record in the appeal order can be rectified under section 161. The portal’s manual describes the route: ORDERS tab > “Initiate Rectification”, select a reason, attach documents, verify, and submit with DSC or EVC. A rectification reference number is issued.

The time limits differ by source. Section 161 allows the affected person to point out an error “within a period of three months from the date of issue”. No rectification may be made after six months, except for clerical or arithmetical slips. The portal’s FAQ says a request “can be submitted within 6 months from the date of order”. Section 161 is the governing text.

Rights and duties at each step

• At hearing. The appellant is entitled to be heard and to reply to every notice. Each party may have at most three adjournments.
• On evidence. New evidence comes in only under one of the four exceptions in rule 112(1), with recorded reasons, and after the department has had a chance to answer it.
• On enhancement. No enhancement of a penalty, reduction of refund or credit, or fresh tax demand without a show cause notice. A fresh tax demand must also fall within the section 73, 74 or 74A limits.
• On the order. A reasoned order, communicated to both sides, with an APL-04 summary. Under section 107(16), the order is “final and binding on the parties”, subject to revision, the Tribunal and the courts.

What can still be put right

• A ground omitted can be added if the omission was not wilful or unreasonable.
• Evidence the adjudicating authority refused, or had no fair chance to receive, can be admitted under rule 112.
• An error apparent on the face of the appeal order can be rectified under section 161.
• An adverse order can be taken to the Tribunal within three months of communication, with the further pre-deposit. See Appealing to the GST Appellate Tribunal.
• The department may revise the order only on points “not raised and decided” in the appeal, within one year of the appeal order or three years of the original order, whichever is later (proviso to section 108(2)). See Revision: Section 108.

The steps in order

1. After APL-02, watch the case folder under View Additional Notices/Orders for the hearing notice.
2. Reply to each notice through the NOTICES tab, with documents, signed with DSC or EVC.
3. Seek an adjournment only for sufficient cause. There are three per party.
4. For new evidence, state which rule 112(1) exception applies.
5. Ask the Appellate Authority to decide on the record, not to remand.
6. If a show cause notice proposes enhancement, answer it. Withdrawal is no longer available.
7. On the order, check the APL-04 figures against the liability register, and request rectification of any error apparent on the record.
8. If the order is adverse, calculate the Tribunal pre-deposit and the three-month limit. If it is favourable, claim the pre-deposit refund.

The next guide covers the department’s side: how a Commissioner reviews an order under section 107(2), and the application in FORM GST APL-03 that follows.