Archaeological survey of India started excavation in the year 1971 at Piprahwa under direction of Shri K. M. Srivastava. The primary objective of the excavation was to locate the lost town of ancient Kapilavastu and thereby settle the long standing controversy. The excavation at Piprahwa led to an epoch-making discovery by settling the location of ancient Kapilavastu, which had been eluding the archaeologists for more than hundred years. This excavation revealed a large number of terracotta sealings with the legend Kapilavastu which ultimately clinched the identification of the ancient settlement of Kapilavastu. The inscriptions on the sealings are Om Devaputra Vihare Kapilavastu Bhikhu Sanghas and Maha Kapila vastu Bhikhshu Sanghas.
Though the inscription on the casket found by W.C. Peppe in 1898 in the stupa at Piprahwa was evident enough to indicate that the stupa enshrined the relics of Lord Buddha, it could not carry conviction amongst the scholars, particularly because of the difference in the date of the inscription and that of the death of Buddha. The relic caskets found in the burnt-brick chambers much below the level of the massive stone box, which contained the inscribed casket, and also distinguished stratigraphically, have now completely dispelled the doubts. That the casket contained the relics of Buddha is further corroborated by the earlier stupa and the terracotta sealing with the legend Kapilavastu. According to Buddhist text Mahaparinibbanasutta, the corporeal relics of Lord Buddha were shared by eight republics immediately after his cremation at Kusinara. The Sakyas of Kapilavastu received share over which they erected a stupa. The words iyam salila nidhane budhasa bhagavate Sakiyanam on the casket found by Peppe , fresh relic caskets found in the same stupa and the terracotta sealings lead to one and the same conclusion that the stupa at Piprahwa was first solemnised by the Sakya over one-eighth share of the relics received by them.
The third important result of the excavation rests in establishing that the Kushan kings were closely attached with the sacred site. It was only under their patronage that the stupa and the eastern monastery were embellished in their third stage of construction. So far as the eastern monastery is concerned, the evidence is offered by the word Devaputra on the terracotta sealings, whereas the reconstruction the stupa is confirmed by the square base with niches at regular intervals.