Sections 127D-127G 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.
Sections 127D, 127F and 127G describe what the Settlement Commission can do while a case is before it: attach property provisionally to protect revenue, exercise the powers of a customs officer with exclusive jurisdiction in the case, regulate its own procedure, and control access to reports made to it by customs officers. The copy consulted prints no section 127E; the numbers go from 127D to 127F. This article follows the text on the CBIC portal updated to 30 March 2022 and adds the provisions inserted by the Finance Act, 2025, under which, on and from 1 April 2025, these powers and functions are exercised by the Interim Board.
The Settlement Commission may attach provisionally any property of the applicant if it considers this necessary to protect revenue, and the attachment ceases when the sums due are discharged and evidence is submitted. Once an application is allowed to proceed it has exclusive jurisdiction over the case until its order under section 127C(5). It can regulate its own procedure. No person may inspect or copy an officer's report to the Commission, except as the Commission allows, and a person whose case is under consideration is entitled to a certified copy to rebut evidence against him. On and from 1 April 2025 the power of attachment (127D), the powers and functions in section 127F and the functions under section 127G are exercised or performed by the Interim Board, with the provisions applying to it as they applied to the Settlement Commission.
The text consulted is the CBIC copy last updated on 30 March 2022 (the Act as amended up to the Finance Act, 2022), with the Finance Act, 2025 additions. The Finance Act, 2023 could not be checked in full; see the section on later Finance Acts below.
A note on the numbering
The copy consulted prints sections 127D, 127F and 127G in sequence and prints no section 127E. This article describes only what is printed.
For the earlier steps of the chapter, see our articles on the application under section 127B and the procedure under section 127C. If your matter is before the Commission and you want help understanding these powers, our legal dispute resolution team can assist.
Section 127D: provisional attachment
Sub-section (1). "Where, during the pendency of any proceeding before it, the Settlement Commission is of the opinion that for the purpose of protecting the interests of the revenue it is necessary so to do, it may, by order, attach provisionally any property belonging to the applicant in such manner as may be specified by rules."
Four things stand out:
- The power operates "during the pendency of any proceeding before it".
- The test is the Commission's "opinion" that it is "necessary" to protect "the interests of the revenue".
- The property attached is "any property belonging to the applicant".
- The manner of attachment is "as may be specified by rules", not in the Act.
Sub-section (2). Every provisional attachment "shall cease to have effect from the date the sums due to the Central Government for which such attachment is made are discharged by the applicant and evidence to that effect is submitted to the Settlement Commission". Two things must happen: discharge of the sums, and submission of evidence of discharge. The attachment ends from the date on which both are in place.
Sub-section (3) (Finance Act, 2025). "On and from the 1st day of April, 2025, the power of the Settlement Commission under this section shall be exercised by the Interim Board and the provisions of this section shall mutatis mutandis apply to the Interim Board as they apply to the Settlement Commission." So for pending applications the attachment power is now the Interim Board's.
Example with invented names (the example describes the position before the Interim Board arrangement): Ishaan Trading Co applies for settlement, and the Commission, concerned that the sums due might not be recoverable, passes an order attaching a warehouse of the company provisionally. When Ishaan pays the sums due and files proof of payment with the Commission, the attachment ceases to have effect from that date.
Section 127F: power and procedure
Sub-section (1): powers. "In addition to the powers conferred on the Settlement Commission under Chapter V of the Central Excise Act, 1944 (1 of 1944), it shall have all the powers which are vested in an officer of the customs under this Act or the rules made thereunder." The reference to the Central Excise Act, 1944 is quoted as printed.
Sub-section (2): exclusive jurisdiction. Where an application under section 127B has been allowed to proceed under section 127C, the Commission has, until an order is passed under section 127C(5) and subject to section 127C(4), "exclusive jurisdiction to exercise the powers and perform the functions of any officer of customs or Central Excise Officer as the case may be, under this Act or in the Central Excise Act, 1944 (1 of 1944), as the case may be, in relation to the case." The footnotes record that the numbers "(5)" and "(4)" in this sub-section replaced "(7)" and "(6)" by the Finance Act, 2007 (22 of 2007), with effect from 01.06.2007. The result is that, for that case, the Commission steps into the officer's position while the case is before it.
Sub-section (3): other matters unaffected. "In the absence of any express direction by the Settlement Commission to the contrary, nothing in this Chapter shall affect the operation of the provisions of this Act in so far as they relate to any matter other than those before the Settlement Commission." So the chapter does not suspend the Act for matters not before the Commission.
Sub-section (4): own procedure. The Commission, "subject to the provisions of Chapter V of the Central Excise Act, 1944 (1 of 1944) and this Chapter", has power to regulate its own procedure and that of its Benches in all matters arising out of the exercise of its powers or discharge of its functions, "including the places at which the Benches shall hold their sittings".
Sub-section (5) (Finance Act, 2025). "On and from the 1st day of April, 2025, the powers and functions of the Settlement Commission under this section shall be exercised by the Interim Board and the provisions of this section shall mutatis mutandis apply to the Interim Board as they apply to the Settlement Commission."
| Sub-section | Subject | Core words |
|---|---|---|
| (1) | Powers | All powers of an officer of the customs under the Act or rules, in addition to those under Chapter V of the Central Excise Act, 1944 |
| (2) | Jurisdiction | Exclusive, from allowance of the application until the order under section 127C(5), in relation to the case |
| (3) | Other matters | Not affected, unless the Commission expressly directs otherwise |
| (4) | Procedure | The Commission regulates its own and its Benches' procedure |
Section 127G: inspection of reports
The rule is stated first: "No person shall be entitled to inspect, or obtain copies of, any report made by any officer of the Customs to the Settlement Commission". The exception: "the Settlement Commission may, in its discretion, furnish copies thereof to any such person on an application made to it in this behalf and on payment of such fee as may be specified by rules". The discretion rests with the Commission; the fee is set by rules and is not stated in the Act or in this article.
The proviso. "For the purpose of enabling any person whose case is under consideration to rebut any evidence brought on record against him in any such report, the Settlement Commission shall, on an application made in this behalf, and on payment by such person of such fee as may be specified by rules, furnish him with a certified copy of any such report or part thereof relevant for the purpose." The word is "shall": for the limited purpose of rebuttal, a person whose case is under consideration has a right to a certified copy of the report or the relevant part, on application and payment.
Second new proviso (Finance Act, 2025). "Provided further that on and from the 1st day of April, 2025, the functions of the Settlement Commission under this section shall be performed by the Interim Board and the provisions of this section shall mutatis mutandis apply to the Interim Board as they apply to the Settlement Commission." So a request for a copy of a report in a pending application is now made to the Interim Board.
Practical reading: if a report brings evidence against an applicant, the applicant should apply in writing for a certified copy of the report or the relevant part, stating that the purpose is to rebut that evidence. For other persons, the copy is a matter for the Commission's discretion.
The rules
The Customs (Settlement of Cases) Rules, 2007, made under section 156, contain, according to their table of contents, a rule on the manner of provisional attachment of property and a rule on the fee for copies of reports. The copy consulted is dated 12 April 2017, the date printed on that file and not of the Act text. This article takes no fee or procedure detail from it.
Practical points
- Treat an attachment order as live until you have paid the sums due and filed evidence of payment with the Commission.
- Remember that the Commission, once the application is allowed to proceed, stands in the place of the customs officer for the case until its order under section 127C(5).
- Apply for a certified copy of any adverse report promptly, with the rebuttal purpose stated.
- Take the fee and the attachment procedure from the rules in force.
Changes made by later Finance Acts
| Finance Act | What changed | What the gazette prints about commencement |
|---|---|---|
| Finance Act, 2025 (No. 7 of 2025), section 99 | Section 127D: new sub-section (3), the attachment power is exercised by the Interim Board | "On and from the 1st day of April, 2025" (in the sub-section). Assent on 29 March 2025 |
| Finance Act, 2025, section 100 | Section 127F: new sub-section (5), powers and functions are exercised by the Interim Board | "On and from the 1st day of April, 2025". Assent on 29 March 2025 |
| Finance Act, 2025, section 101 | Section 127G: new proviso, functions are performed by the Interim Board | "on and from the 1st day of April, 2025". Assent on 29 March 2025 |
The Interim Board is defined in section 127A; the gazette text does not give the date of its constitution. The Finance Act, 2023 amendments to the Customs Act could not be checked in full, because only an extract of that Act was available. Check the current text on the CBIC portal before relying on any clause of these sections.
Need help with a matter before the Settlement Commission?
An attachment order, a report with adverse evidence or a question of jurisdiction needs a quick, careful reading of the papers. Our team can help you plan your response through legal dispute resolution for customs matters, and prepare the application for a certified copy where one is needed.
Key takeaways
- Section 127D lets the Commission attach property provisionally during pendency; the attachment ceases when the sums due are discharged and evidence is submitted.
- Section 127F gives the Commission an officer's powers, exclusive jurisdiction in the case until its order under section 127C(5), and its own procedure.
- Section 127G bars inspection or copies of officers' reports, with discretion for the Commission and a certified copy for rebuttal on application and payment.
- On and from 1 April 2025 the Interim Board exercises the attachment power (127D(3)), the powers and functions in 127F(5) and the functions under 127G (second new proviso).
- Rules fix the manner of attachment and the fee; the copy consulted prints no section 127E.
Read next
- Section 127C: procedure on a settlement application
- Sections 127H and 127I: immunity from prosecution and penalty, and sending a case back
- Sections 127J to 127N: settlement order, recovery and bar on second application
- Section 127A: settlement of cases, definitions
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. The changes made by the Finance Act, 2025 are added from its gazette text; the Finance Act, 2023 could not be checked in full, and the current rules, regulations and notifications should be checked. This article is general information, not legal advice; check the official text before acting.