Section 124 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 124 is the fair-hearing rule for confiscation and penalty cases in Chapter XIV. No order confiscating goods or imposing a penalty may be made unless the owner of the goods or the person concerned has been given a written notice stating the grounds, a chance to reply in writing, and a reasonable opportunity of being heard. This article follows the text on the CBIC portal updated to 30 March 2022.
Before an order of confiscation of goods or a penalty is made under this Chapter, the person must receive (a) a notice in writing, with the prior approval of an officer not below the rank of Assistant Commissioner of Customs, informing him of the grounds; (b) an opportunity to make a written representation within the reasonable time specified in the notice; and (c) a reasonable opportunity of being heard. The notice and representation may be oral on the person's request, and a supplementary notice may be issued as prescribed.
The text consulted is the CBIC copy last updated on 30 March 2022 (the Act as amended up to the Finance Act, 2022). Later Finance Acts are not in that copy; check any later change to section 124 before acting.
What section 124 protects
The section opens with a bar: "No order confiscating any goods or imposing any penalty on any person shall be made under this Chapter unless" three steps are taken. It protects "the owner of the goods or such person". The Chapter is Chapter XIV, which includes section 111 on confiscation of goods, discussed in our article on confiscation of goods under section 111, and the penalty sections, summarised in Penalties under the Customs Act, sections 112 to 117.
If you have received a notice and are unsure how to answer it, our legal dispute resolution team can help you read the grounds and prepare a reply.
The three steps
| Clause | Requirement | Key words |
|---|---|---|
| (a) | A notice in writing | With the prior approval of an officer of Customs not below the rank of an Assistant Commissioner of Customs; informing the person of the grounds on which it is proposed to confiscate the goods or impose a penalty |
| (b) | An opportunity to represent in writing | Within such reasonable time as may be specified in the notice, against the grounds mentioned in it |
| (c) | A reasonable opportunity of being heard | In the matter |
Clause (a), the notice. The footnotes print the history of the words. The phrase "writing with the prior approval of the officer of Customs not below the rank of an Assistant Commissioner of Customs, informing" was substituted for "writing informing" by the Taxation Laws (Amendment) Act, 2006 (29 of 2006), with effect from 13.07.2006, and "an Assistant Commissioner of Customs" replaced "a Deputy Commissioner of Customs" by the Finance Act, 2011 (8 of 2011), with effect from 08.04.2011. Two features follow from the text. The notice has to be in writing, and it has to carry the prior approval of an officer of the stated rank. It must also inform the person of "the grounds", for confiscation or for penalty. A notice that lists no grounds does not meet the words of the clause.
Clause (b), the written representation. The person is given an opportunity to make a representation in writing "within such reasonable time as may be specified in the notice". The time is therefore stated in the notice itself, and the Act does not print a number of days. Read the notice for its date. The representation is "against the grounds of confiscation or imposition of penalty mentioned therein", so the reply should address each ground stated.
Clause (c), the hearing. A "reasonable opportunity of being heard in the matter" is separate from the written representation. Section 122A, discussed in our article on adjudication, the hearing and burden of proof, adds that the hearing is given if the party so desires and that adjournments are limited to three for a party.
Oral notice and representation
The first proviso says that "the notice referred to in clause (a) and the representation referred to in clause (b) may, at the request of the person concerned be oral." The words "at the request of the person concerned" matter: the choice lies with the person, not with the officer. A person who prefers a written record should keep to writing. A person who requests oral process may wish to ask for the oral exchange to be recorded in writing for the file; the section does not say how the oral process is recorded and this article states no procedure.
Supplementary notice
The second proviso (inserted by section 94 of the Finance Act, 2018 (13 of 2018), with effect from 29-3-2018, per the footnote) says that "notwithstanding issue of notice under this section, the proper officer may issue a supplementary notice under such circumstances and in such manner as may be prescribed." The circumstances and manner are left to be prescribed, so the section itself gives neither. Read the instrument that prescribes them for the case. The proviso also does not say that a supplementary notice replaces the first notice; it says the first notice does not prevent it.
Notice and the six-month rule for seizure
Where goods are seized under section 110, sub-section (2) of that section carries a six-month notice rule, as printed with its provisos. Our article on section 110 and the six-month notice rule covers it. Section 124 is a different requirement: it governs the notice that must precede an order of confiscation or penalty. Both can arise in the same case, and each has its own conditions.
An example
Nirmal Exports Pvt Ltd is served with a notice proposing confiscation of a consignment and a penalty on its director. The notice is signed by the issuing officer and records the grounds in two paragraphs, and it gives the company a stated time to reply. The company can check the following:
- Is the notice in writing, with the prior approval of an officer not below the rank of Assistant Commissioner of Customs?
- Does it state the grounds for confiscation and for the penalty?
- Does it give a reasonable time for a written representation?
- Has the company been given an opportunity of a hearing before any order?
If a later supplementary notice arrives, the company reads it for the circumstances and manner under which it was issued.
Practical points
- Note the date of the notice and the reply time stated in it; the Act itself prints no number of days for the representation.
- Reply to each ground separately and ask for a hearing if you want one.
- Keep a written record of any oral submission.
- Treat a supplementary notice as a fresh document that needs its own reply.
- For the stage after an order, see our articles on redemption fine and vesting and on how to file a customs appeal before CESTAT.
Need help replying to a show cause notice?
A good reply answers each stated ground, attaches the documents and asks for a hearing in time. Our team can help you review the notice and prepare the reply; see our legal dispute resolution service for customs matters, and contact us well before the reply date.
Key takeaways
- Section 124 bars an order of confiscation or penalty under Chapter XIV unless notice, a written representation opportunity and a hearing have been given.
- The notice must be in writing with the prior approval of an officer not below the rank of Assistant Commissioner of Customs, and must inform the person of the grounds.
- The time for the written representation is the reasonable time specified in the notice.
- The notice and representation may be oral at the person's request.
- A supplementary notice may be issued under circumstances and in a manner as prescribed.
Read next
- Sections 122 and 123: adjudication and burden of proof
- Sections 125 to 127: redemption fine and vesting of goods
- Section 110: seizure of goods and the six-month notice rule
- Customs appeal process: Commissioner (Appeals), CESTAT and the High Court
Disclaimer: Based on the Customs Act, 1962 as published on the CBIC Tax Information Portal, updated to 30 March 2022 (amended up to the Finance Act, 2022), as consulted on 2 October 2026. Finance Acts of 2023 and later, and the current rules, regulations and notifications, should be checked. This article is general information, not legal advice; check the official text before acting.