The Central Government has notified August 1, 2025 as the effective date for cessation of office of the Chairman, Vice-Chairman, and Members of the Customs and Central Excise Settlement Commission, under Rule 7 of the Settlement Commission Rules, 2015.
This marks a key administrative transition in line with the Finance Act, 2021, which had earlier paved the way for phasing out the Commission.
What is the Customs and Excise Settlement Commission?
- It allowed taxpayers to settle past disputes by making full and true disclosure
- Provided immunity from prosecution and penalties, subject to conditions
- Was particularly helpful for businesses wanting to resolve litigation without prolonged proceedings
The Finance Act, 2021 inserted Section 127B(5) and Section 32P(5) to close doors to new settlement applications. Here’s what changed:
| Provision | Customs Act | Excise Act |
|---|---|---|
| No new applications allowed from | 01.02.2021 | 01.02.2021 |
| Pending cases to be handled by | Interim Board (CBIC appointed) | Interim Board (CBIC appointed) |
| Official cessation date notified | 01.08.2025 | 01.08.2025 |
Legal Basis: Rule 7 of Settlement Commission Rules, 2015
Rule 7 deals with “Cessation of office” of the Commission’s members.
This Rule empowers the Central Government to notify a specific date on which the tenure of the Chairman, Vice-Chairman, and Members shall end.
👉 Official Source: cbic.gov.in – Notification No. 47/2025-Customs (N.T.)
What Happens to Pending Cases?
- Immunity, if granted earlier, remains valid
Expert View
Many tax experts view this transition as the Centre’s effort to centralise adjudication and tighten compliance. But this also reduces voluntary dispute resolution windows for assessees.
Tip: Taxpayers with older disputes should now focus on representations before Adjudicating Authorities or explore compounding options if applicable.
FAQs on Customs Settlement Commission Cessation
Q1. Can I still apply to the Customs Settlement Commission?
No. New applications have not been accepted since 1st Feb 2021.
Q2. What if I have a pending case before the Commission?
It will be handled by the Interim Settlement Board, constituted by CBIC.
Summary
Central Government has officially notified 01.08.2025 as the cessation date for the Chairman and Members of the Customs and Central Excise Settlement Commission, under Rule 7 of the 2015 Rules. Pending cases shift to CBIC’s Interim Board.