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Do not treat a GST notice and a GST demand order as the same document. A notice gives the business an opportunity to answer a proposed liability; an adverse adjudication or demand order starts a time-sensitive decision about appeal, pre-deposit and recovery. First download the complete record from the GST Portal, identify the issuing authority, tax period, statutory provision, amounts and communication date, then reconcile every allegation with the business’s own records. Reply through the applicable procedure, preserve the acknowledgment, and obtain qualified Indian GST advice promptly where the amount or legal issues are material.
Start by identifying the procedural stage
The document’s stage determines what the business must do next. Read the heading, reference number and cited provision on the notice or order, and compare it with the live entry under the GST Portal’s notices and orders. Save the original PDF, every annexure and the portal communication showing when and how it was served.
| Stage | What it means | Immediate action | Deadline source and risk |
|---|---|---|---|
| Notice or show-cause communication | The department proposes tax, interest or penalty and invites a response. A DRC-01 summary may accompany a notice. | Reconcile the allegations, prepare a point-by-point reply, attach records and submit through the specified process. For notices whose summary is uploaded in DRC-01, the CGST Rules identify DRC-06 as the reply form. | Follow the date and instructions in the notice and the governing provision. There is no single response period that applies to every proceeding. |
| Adjudication or demand order | An adjudicating authority has made a decision. A DRC-07 summary is used for covered orders and is treated under the rules as a notice for recovery. | Calculate the limitation period from communication, assess first-appeal rights and pre-deposit, and monitor recovery status while preparing the appeal. | The GST Portal appeal guidance states three months from communication, with up to one additional month for condonation on sufficient cause, and a minimum 10% pre-deposit of disputed tax for the appeal described. Verify the current law and order-specific requirements. |
Do not infer the stage from an email subject alone. An order may be uploaded separately from its summary, and a portal status can change after the first download. The tax period, the State or Union Territory enactment involved, amendments and notifications can also affect the applicable law.
Secure and classify the record before responding
Download a complete evidence set
Create a case folder with read-only copies of the notice or order, annexures, relied-on statements, portal screenshots or downloaded acknowledgments, earlier correspondence and proof of service. Record the date shown as communication, the date the business actually accessed the document, the officer and office, the reference number, and the exact reply or appeal deadline. If more than one tax period or registration is involved, make a separate index for each.
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Read the legal provision and allegation together
The CGST Act distinguishes demand proceedings under sections 73 and 74. Do not assume that a defence, limitation argument or penalty position applicable to one provision automatically applies to another. Identify whether the department alleges a simple tax shortfall, an ineligible credit, a mismatch, erroneous refund, fraud, wilful misstatement or suppression, and which facts it says support that allegation. The order’s reasoning, not a generic online explanation, controls the response you need to prepare.
Build a deadline log
- Notice or order communication date and method of service.
- Reply date stated in the notice, including any hearing date.
- For an order, the last ordinary appeal date calculated from communication.
- Internal dates for collecting records, management approval, professional review and final upload.
- Proof that each submission was accepted, including ARN, acknowledgment number, downloaded form and portal status.
Set an internal deadline several working days before the external one. Portal outages, file-size limits, unavailable annexures or an incorrect authorized signatory can otherwise consume the final day.
Reconcile the proposed liability before drafting
Prepare a working schedule that ties every allegation and amount to the business’s books and source records. This schedule is for accuracy and should not be sent unedited if it contains internal notes or privileged advice.
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| Issue to test | Records to compare | Questions to answer |
|---|---|---|
| Taxable turnover or value | Returns, sales register, invoices, contracts, credit notes and payment ledger | Which transaction, period, customer or rate has the department included or omitted? Is the same turnover counted twice? |
| Input tax credit or eligibility | Purchase invoices, contracts, receipt or payment evidence, accounting entries and relevant reconciliations | Does each disputed credit map to a real supply and the period claimed? Is the department relying on a mismatch, missing document or eligibility condition? |
| Tax, interest and penalty computation | Return data, challans, electronic liability and cash ledgers, department worksheets and prior payments | Is the principal tax correct? Are payments allocated to the right period and head? Does the interest or penalty calculation use the right base and dates? |
| Factual assertions | Delivery records, correspondence, board or management approvals, contracts and earlier replies | Can each statement in the proposed reply be proved by a dated record, and does the record cover the entire period alleged? |
Mark each allegation as admitted, partly disputed or fully disputed. For a partly disputed item, show the department’s figure, the business’s figure and the mathematical difference. Identify missing departmental workings instead of guessing how an unexplained total was derived. A concise reconciliation often exposes a duplicate invoice, wrong tax period, payment not credited or arithmetic error before the response is filed.
Reply to a notice with a point-by-point submission
Use the applicable form and procedure
Where a notice summary is uploaded in DRC-01, the CGST Rules identify DRC-06 for the reply. The notice may also prescribe a hearing, a particular portal route or additional documents. Follow those instructions and the governing provision; do not substitute an email or informal letter unless the authority expressly permits it. If the portal does not show the expected notice, preserve evidence of the search and seek clarification through the official channel without allowing the stated deadline to expire.
Organize the written response
- Identify the proceeding. State the registration, tax period, notice number, date and the amount proposed under each head.
- Give a short position statement. Say which parts are accepted, disputed or impossible to verify because the department has not supplied a calculation.
- Answer each allegation in the notice’s order. Use numbered headings that match the notice so the officer can locate the response.
- Set out facts first. Explain the transaction, accounting treatment, tax return entry and payment history with dates and amounts.
- Apply the relevant law carefully. Cite the provision relied on, but avoid claiming that an argument necessarily succeeds without checking the current statute, notifications and the complete record.
- Show calculations. Attach a reconciliation for principal tax, interest and penalty, identifying any amount already paid.
- Index the evidence. Use an attachment list, consistent file names and page numbers; redact unrelated personal or commercial data where appropriate.
- State the relief requested. Ask for withdrawal or reduction of the proposed demand, correction of computation, credit for payments and a personal hearing where the law or notice provides for one.
Submit and preserve proof
Before uploading, confirm that the authorized signatory, digital signature or electronic verification, file format and size meet the portal requirements. Download the submitted DRC-06 or equivalent response, every attachment, the ARN or acknowledgment and the final status screen. Keep the exact files that were submitted, not only a later edited draft. Filing evidence is essential if the department later says no reply was received.
If the department has issued a demand order
Calculate the first-appeal period immediately
Section 107(1) of the CGST Act states: “Any person aggrieved by any decision or order passed under this Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act by an adjudicating authority may appeal to such Appellate Authority as may be prescribed within three months from the date on which the said decision or order is communicated to such person.” The GST Portal’s demand-order FAQ, accessed on 13 October 2026, describes the same three-month period and says a delay may be condoned for up to one additional month where sufficient cause is shown.
Use the communication date shown in the service record and retain proof of it. Do not wait for a recovery message, a bank action or a reminder to start the limitation calculation. A condonation request is not a routine extension; prepare evidence explaining the delay and verify the current statutory wording before relying on it.
Budget for the stated pre-deposit
The cited GST Portal guidance describes a minimum pre-deposit of 10% of the disputed tax before filing the first appeal against the demand order. Treat this as a procedural requirement for the appeal described, not as 10% of interest, penalty or the entire demand unless the applicable law says otherwise. Use the order’s disputed-tax figure, check any amount already paid and verify the current Act, notifications and order-specific calculation with a GST professional. An illustrative calculation only: if the disputed tax is ₹8,00,000, 10% is ₹80,000; the actual amount and heads to be deposited must be confirmed for that proceeding.
File through the portal and obtain the final acknowledgment
The GST Portal FAQ describes this route for a demand-order appeal:
- Sign in to the GST Portal.
- Open Services > User Services > My Applications.
- Select Appeal to Appellate Authority and choose Demand Order.
- Complete the appeal in form APL-01, upload the order and supporting documents, and make the required pre-deposit.
- If the order is not uploaded on the portal, submit a self-certified copy within seven days as instructed by the FAQ.
- Track the application until the final APL-02 acknowledgment with an appeal number is issued.
The FAQ says the appeal is treated as filed only when that final APL-02 acknowledgment is issued. A draft, payment receipt, ARN or initial upload screen is not a substitute for checking the final acknowledgment and status. Save the APL-01, APL-02, payment proof, uploaded order, attachments and all subsequent communications together.
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The GST Portal guidance says that, when the appeal is admitted, the balance disputed amount is flagged as non-recoverable on the Portal. That is a status to verify, not an automatic stay created merely by uploading an appeal. Confirm that the appeal has been admitted, inspect the recorded recovery status and respond promptly if the portal still shows the amount as recoverable.
Because a DRC-07 order summary is treated under the CGST Rules as a notice for recovery, do not ignore a recovery communication while preparing an appeal. Keep proof of the pre-deposit, acknowledgment and admission status available for any interaction with the department, bank or other recovery authority. The exact effect of an appeal can depend on the order, statutory provision and current procedural rules.
Common mistakes and how to avoid them
- Calling every document a “notice.” An order requires limitation and appeal analysis, not merely a reply.
- Using one generic deadline. Notice reply periods are proceeding-specific; the three-month figure concerns the first appeal described in the GST Portal guidance.
- Submitting a narrative without a reconciliation. Officers need a transaction-level bridge from allegation to return, invoice, ledger and payment.
- Uploading without proof. Retain the exact files, ARN, acknowledgment, APL-02 and portal status.
- Assuming an appeal stops recovery immediately. Check admission and the recorded non-recoverable status.
- Relying on an old form or rule compilation. The available CGST Rules PDF is a 2020 compilation; later amendments may apply.
- Ignoring tax-period and jurisdiction differences. The applicable Central, State or Union Territory law, notifications and amendments can change the analysis.
- Waiting until the last day. Technical failure, missing records or an unavailable signatory can make a timely filing impossible.
When professional help is warranted
Engage a qualified GST practitioner or Indian tax lawyer early when the demand is substantial, spans several tax periods or registrations, alleges fraud, wilful misstatement or suppression, raises limitation questions, involves complex input-tax-credit or valuation issues, or is close to the reply or appeal deadline. A professional can test the statutory provision, calculate the disputed tax and pre-deposit, frame a condonation request if needed, and coordinate the portal filing with the accounting records. Management should still retain an internal chronology and evidence index so the adviser receives a complete factual record.
A case-file checklist
- Complete notice or order, annexures and DRC-01 or DRC-07 summary where applicable.
- Proof and date of communication.
- Returns, reconciliations, invoices, contracts, ledgers and payment records relevant to each allegation.
- Earlier replies, hearing notices, departmental correspondence and payment challans.
- Point-by-point response or draft appeal with a calculation schedule.
- DRC-06 submission proof for a notice reply, or APL-01, pre-deposit proof and APL-02 for an appeal.
- Portal status showing admission and recovery treatment, checked after filing.
- Internal deadline log and a record of who approved the final submission.
The safest approach is procedural: classify the document, prove the communication date, reconcile the amounts, answer the actual allegations, file through the correct channel and verify the final acknowledgment. For an adverse order, treat the three-month appeal period, possible one-month condonation limit and stated 10% pre-deposit as urgent checkpoints, then confirm them against the law and the particular order before acting.
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