GST Appeal Against NIL Demand Order: What the New APL-01 Update Means (2026)

You disagree with a GST demand order, so you decide to challenge it. You log in to the portal, open the appeal form, and the system refuses to let you go ahead. For many taxpayers this was exactly the situation: the order showed the demand as NIL or Zero, and the portal treated that as “nothing to appeal against”.

On 7 September 2026, GSTN removed this block. This blog explains what a NIL demand order is, why the problem existed, what the new advisory says, who can use it, and what it does not change.

Quick summary before we start:

GSTN has removed the portal validation that stopped appeals against NIL or Zero demand orders.
You can now file Form GST APL-01 against such an order, if a dispute about your liability still exists.
This applies where you had already paid the amount before the order was issued.
It is a portal fix. It is not a new right, and it does not decide the appeal for you.
The advisory says nothing about time limits or pre-deposit, so check those separately.

What Is a NIL or Zero Demand Order in GST?

The short answer

A NIL or Zero demand order is a GST order where the “demand amount” shown is zero, even though the officer has decided that you owed tax.

The order may still say that your liability was correctly determined. It just shows nothing as pending, because you have already paid.

How a demand order becomes “NIL” (payment before the order)

During a GST notice or proceeding, many taxpayers pay the disputed tax before the final order comes. They do this to stop interest from growing, or to reduce stress, while still believing the demand is wrong. This payment is usually made through Form DRC-03, which is the form for voluntary payment.

When the officer later passes the final order (the summary is issued in Form DRC-07), the system adjusts that payment. The outstanding demand then becomes zero, so the order shows NIL.

A simple example

Ramesh runs a trading business. An officer says he claimed ₹2 lakh of input tax credit wrongly. Ramesh thinks the officer is wrong, but he pays ₹2 lakh through DRC-03 so that interest stops running.

Later the order arrives. The officer holds that the ITC was wrongly claimed. Because Ramesh has already paid, the “demand outstanding” shows zero.

Ramesh still believes the order is wrong. He wants to appeal. This is exactly the person this update is meant for.

What Was the Problem Before This Update?

The portal error taxpayers were seeing

When taxpayers tried to file Form GST APL-01 against such an order, the portal showed an error saying the disputed amount cannot be more than the demand amount itself.

Why the portal blocked the appeal

The reason was simple. In APL-01 you enter the amount you are disputing. The portal compared it with the demand amount recorded for the order. When the order showed zero demand, any disputed amount you entered looked “more than the demand”, and the portal stopped you.

NIL-demand orders also created zero-value entries in the taxpayer’s demand and collection register, so the system saw no demand to appeal against.

The law gives you a right to appeal. The portal had quietly made it hard to use that right.

What taxpayers had to do earlier (rectification order)

Many taxpayers had to first ask the officer for a rectification order that showed the correct demand amount. Only after that could they file the appeal. It cost time, and the appeal period was running while they waited.

What Is the New GSTN Advisory (No. 671)?

What the advisory says

GSTN issued an advisory titled “Enabling Filing of Appeals in Cases Involving NIL or Zero Demand Amount”. In simple words it says:

If a dispute about liability exists,
and the demand amount in the order is shown as NIL or Zero,
and you paid the amount before the order was issued,
then the earlier validation that stopped the appeal has been removed from the GST portal.

So taxpayers can now file an appeal in Form GST APL-01 against such orders.

What changed on the portal

Only one thing changed: the block is gone. The portal no longer refuses an APL-01 just because the order shows a NIL or Zero demand.

When was it issued?

The advisory is dated 7 September 2026. If you face any difficulty while filing, the advisory suggests raising a ticket with the GST Helpdesk.

Who Can File an Appeal Against a NIL Demand Order?

Situations that are covered

The advisory talks about a specific case. All three of these should be true:

A dispute regarding your liability still exists. You do not agree with what the order has decided.
The demand amount in the order shows NIL or Zero.
You paid before the order was issued.

Situations the advisory does not talk about

Payment made after the order. The advisory speaks only about payment before the order. Do not assume it covers this case.
Orders where a demand is still outstanding. These were never blocked by this issue, and you can appeal in the normal way.
Whether your voluntary payment affects your case on merits. The advisory does not discuss this. If you are unsure how your payment was recorded, take advice from a GST professional before you file.

Read More:- GST Notices A-Z Guide

What Is Form GST APL-01?

Where an appeal is filed

GST APL-01 is the form used to file an appeal before the First Appellate Authority. It is filed on the GST portal by the taxpayer who is not happy with an order passed by an officer.

Appeal under Section 107 in simple words

Section 107 of the CGST Act gives a taxpayer the right to appeal against an order passed by an adjudicating officer. It also sets the rules for the time limit and for the amount that has to be deposited when you appeal.

The new update does not add anything to this section. It only makes sure the portal does not stop a valid appeal.

Step-by-Step: How to File APL-01 Against a NIL Demand Order

The advisory does not give a menu path, so these steps follow the usual appeal flow. The exact screens on the portal may look a little different.

Step 1: Keep the demand order and payment proof ready

Download the order in which the demand shows NIL or Zero. Keep the proof of your earlier payment, which means the DRC-03 acknowledgement and the challan details.

Step 2: Log in and open the appeal option

Log in to the GST portal and go to the section for appeals under your applications. Choose the option to file an appeal before the First Appellate Authority.

Step 3: Fill the APL-01 details

Enter the order details, such as the order number and date. Fill the disputed amounts for tax, interest, penalty and other items, as per what you are challenging.

Earlier, this was the step where the portal gave the error. Now the portal should accept the disputed amount even if the order shows zero demand.

Step 4: Upload documents and the grounds of appeal

Write the grounds of appeal clearly, which means the reasons why you think the order is wrong. Attach the order, the notice, your reply and the payment proof.

A tip on grounds

Keep each ground short and separate. Mention the specific part of the order you disagree with, and why. It helps the Appellate Authority follow your case.

Step 5: Verify and submit

Verify the form using your DSC or EVC, as the portal asks, and submit it.

Step 6: Save the acknowledgement

Download and save the acknowledgement and the reference number. You will need them to track the appeal.

If the portal still shows an error

Raise a ticket with the GST Helpdesk, as the advisory suggests. Keep screenshots of the error, so that the helpdesk can see what you saw.

Documents to Keep Ready

Document	Why you need it
Demand order (and DRC-07 summary)	It is the order you are appealing against
Show cause notice and your reply	They show what was alleged and what you answered
DRC-03 acknowledgement and challan	Proof that you paid before the order
Grounds of appeal	Your reasons for challenging the order
Supporting documents (invoices, returns, reconciliation)	They back up your side of the dispute
Authorisation letter (if a professional files for you)	Allows your representative to act

A tip for ITC disputes: if your dispute is about a mismatch, keep your reconciliation statement ready, since it shows how your books match your returns. Our GST reconciliation guide explains how to prepare it. Also check the status of your supplier’s GSTIN and keep a record of it. Here is how to check whether a GST number is active or not.

Time Limit, Pre-Deposit and Other Points to Check

What the advisory does not cover

The advisory is short and only about the portal. It does not say anything about the time limit for filing, the pre-deposit, or whether your earlier payment counts toward it.

General appeal rules to verify

These points come from the general appeal provisions and not from the advisory, so please confirm them from the law or with a professional for your own case:

Time limit. An appeal under Section 107 has to be filed within a fixed period from the date the order is communicated to you. The Appellate Authority can allow some extra time in certain cases. Do not wait. The appeal period was already running before this update.
Pre-deposit. Normally you have to deposit the admitted amount along with a part of the disputed tax when you appeal. How your earlier voluntary payment is treated here is something to confirm for your case.
Rule changes. GST rules and limits change from time to time, so check the latest notifications before you file. The GST Council has also recommended changes on notices, penalties and pre-deposit, as covered in our 57th GST Council meeting recommendations post. These are only recommendations and not law yet.

What This Update Does NOT Do

It does not cancel the order

The order stays in force. The update only lets you challenge it.

It does not decide the appeal in your favour

Filing an appeal does not mean you will win. The Appellate Authority will look at the facts and the law, and then decide.

It does not change the time limit

The time limit for filing the appeal stays as it was. If you are late, the portal change will not give you extra days.

Common Mistakes to Avoid

Waiting for a rectification order when the only problem was the portal block. If the order has an actual mistake, that is a separate matter.
Missing the appeal deadline because you were waiting for the portal to be fixed.
Entering a wrong disputed amount. Check the tax, interest and penalty figures against the order.
Weak grounds of appeal. A vague appeal is easy to reject. Be specific.
Not saving the payment proof. Your DRC-03 acknowledgement is an important document.
Assuming payment after the order is covered. The advisory talks about payment before the order.

If you are not sure whether your order qualifies for an appeal, it helps to have a GST professional read the order, the notice and your payment proof before you file. Paytaxs supports businesses with notices and compliance through its GST services.

Frequently Asked Questions

Can I file a GST appeal if the demand shows zero?

Yes, in the situation covered by the advisory. That means a dispute about liability exists, the demand shows NIL or Zero, and you paid before the order was issued.

Is this a new right?

No. The right to appeal under Section 107 already existed. The update removes the portal restriction that was making it hard to use.

What if I still get a portal error?

Raise a ticket with the GST Helpdesk and keep screenshots. The advisory itself suggests this.

Do I need a rectification order first?

Not just to get past the portal block, because that block has been removed. If the order has an actual mistake in its figures, a rectification request is a separate matter and you can discuss it with a professional.

Does paying the tax earlier mean I cannot appeal?

The advisory says you can file an appeal even where you paid before the order. It does not discuss how the payment may affect your case on merits, so get advice on that point for your own facts.

Read more GST updates on the Paytaxs blog.

Final Words

This update is a small portal fix with a real effect. For taxpayers who paid early to avoid interest but still disagreed with the order, the system had no way to take their appeal. Now it does.

But a few things stay the same. The order stays in force until the appeal is decided, the time limit still applies, and the pre-deposit rules are separate. Keep your order, payment proof and grounds ready, check your deadline, and file on time.

Another recent GSTN update: GST registration in several states can now be started together using a Master TRN. Read Multistate GST Registration: How the New Master TRN Facility Works (2026).