16-year-old midfielder Benjamin Garre joined City from Velez Sarsfield last year, and the Argentine club claimed that the move breached FIFA's ruling regarding the signing of non-EU minors.
However, back in September, FIFA backed Manchester City's claim that Garre holds an Italian passport, allowing him to join the Premier League club after his sixteenth birthday.
Velez have now appealed to CAS, who will hear the case on Monday. Manchester City could be handed a two-year transfer ban, similar to those served by Barcelona, Real Madrid or Atletico Madrid for breaching similar rules.