A merchant ship has gone to the aid of an asylum seeker boat in waters north-west of the Cocos Islands.

Authorities asked for the merchant ship Atlantic Hero's assistance after the asylum seeker boat, carrying 27 passengers, was spotted by an RAAF pilot.

All on board the boat have been transferred to the Atlantic Hero and will be taken to the Cocos Islands before being transferred to Christmas Island where they will undergo health and identity checks.

The news comes shortly after authorities in Sri Lanka said they had arrested 131 would-be asylum seekers heading to Australia.

Naval officials said they had seized the fishing trawler being used for the people-smuggling operation.

The navy detected the boat carrying 109 people off Sri Lanka's east coast and escorted it to the port of Trincomalee.

A police spokesman said they had arrested another 22 people suspected of preparing to leave the island illegally on a different trawler.

The number of Sri Lankans detained on charges of illegally trying to leave the country has reached more than 250 over the last week.