Form 127 Filing Due Date for August 2026: Seller Compliance by 7 September

Form No. 127 is the declaration used by an eligible resident buyer to obtain specified goods without Tax Collected at Source (TCS), where the goods are intended for manufacturing, processing, production or generation of power and not for trading.

What is Form No. 127?

Form No. 127, prescribed under Rule 212 of the Income-tax Rules, 2026, replaces the earlier Form No. 27C under the Income-tax Rules, 1962. It is linked to Section 394(2) of the Income-tax Act, 2025.

Under Section 394(2), a resident buyer can furnish a declaration to the seller stating that the specified goods purchased will be used:

• For manufacturing, processing or producing articles or things; or
• For generating power; and
• Not for trading purposes.

When a valid declaration is furnished, the seller is not required to collect TCS on the relevant transaction covered by Section 394(1), Table Sl. Nos. 1 to 5. These categories include alcoholic liquor for human consumption, tendu leaves, timber and certain forest produce, scrap, and minerals such as coal, lignite and iron ore.

Due Date for Declarations Received in August 2026

For declarations received from buyers during August 2026, the seller is required to upload the relevant particulars on the Income-tax Department's e-filing portal by:

7 September 2026

Rule 212(3) requires the person responsible for collecting tax to deliver one copy of the declaration to the jurisdictional Principal Chief Commissioner, Chief Commissioner, Principal Commissioner or Commissioner of Income-tax by the seventh day of the month following the month in which the declaration is furnished. The Income Tax Department's Form 127 guidance also confirms the monthly upload requirement by the 7th of the following month.

Responsibilities of the Buyer and Seller

Buyer

The buyer should:

• Be a resident buyer eligible under Section 394(2).
• Furnish Form No. 127 to the seller on or before the date of the transaction.
• Clearly state the intended use of the goods.
• Confirm that the goods will not be used for trading.
• Provide the required PAN and other particulars accurately.

The CBDT's FAQ states that PAN is mandatory for Part A of Form No. 127. If PAN is not provided, the declaration is invalid and the seller is required to collect TCS at the applicable rate.

Seller

The seller should:

• Receive the declaration in the prescribed form and verify its particulars.
• Maintain appropriate records of declarations received.
• Upload the particulars through the Income-tax e-filing portal by 7 September 2026 for declarations received during August.
• Report transactions where TCS was not collected because of the declaration in the applicable quarterly TCS statement, Form No. 143.

Important Compliance Point

Form No. 127 is optional for the buyer and is required where the buyer seeks the benefit of non-collection of TCS. The Income Tax Department also states that a declaration, once filed, cannot be amended or withdrawn under the Income-tax Act, 2025. Accordingly, buyers and sellers should exercise care while preparing and verifying the declaration.

The relevant provision, Rule 212 of the Income-tax Rules, 2026, was notified as part of the new rules through Notification No. 22/2026, G.S.R. 198(E), dated 20 March 2026, with the new framework effective from 1 April 2026.

Conclusion

Businesses that received Form No. 127 declarations during August 2026 should complete the required upload and related records by 7 September 2026. Timely and accurate compliance is particularly important because the declaration directly affects the seller's TCS collection obligations.

For expert guidance on this topic, contact your tax professional today.

Form 127 declarations received in August 2026 are due for upload by 7 September 2026. Review the requirements and stay compliant.