IBC Section 238: Provisions of this Code to override other laws

Section 238 of Insolvency and Bankruptcy Code, 2016: Provisions of this Code to override other laws

Official Bare Act Text

Override / Mandate Mens Rea (Intent) Actus Reus (Conduct) Punishment Limitation Monetary

The provisions of this Code shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law.

238A. Limitation.-

The provisions of the Limitation Act, 1963 (36 of 1963) shall, as far as may be, apply to the proceedings or appeals before the Adjudicating Authority, the National Company Law Appellate Tribunal, the Debt Recovery Tribunal or the Debt Recovery Appellate Tribunal, as the case may be.

Legal Commentary & Landmark Judgments: Section 238

Section 238 establishes the complete statutory supremacy of the Insolvency and Bankruptcy Code, decreeing that its provisions override any inconsistent provisions in any other central or state law.

Core Legal Standard: Section 238 contains an expansive non-obstante clause ensuring that the IBC prevails over earlier and contemporaneous central or state enactments, including Companies Act, SARFAESI Act, RDDBFI, Indian Stamp Act, Electricity Act, and tax statutes.
Operational Mechanism: In any conflict between corporate insolvency resolution and competing statutory claims, the IBC reigns supreme.

Key Landmark Precedents:

Innoventive Industries Ltd. v. ICICI Bank (2018) 1 SCC 407: The Supreme Court established that Section 238 overrides state debt-relief statutes (such as the Maharashtra Relief Undertaking Act), ensuring national uniformity in corporate debt resolution.
Sundaresh Bhatt v. Central Board of Indirect Taxes and Customs (2023) 1 SCC 472: Held that Section 238 overrides the Customs Act, preventing tax authorities from taking coercive recovery action against corporate assets during CIRP.
Paschimanchal Vidyut Vitran Nigam Ltd. v. Raman Ispat Pvt. Ltd. (2023) 10 SCC 60: Affirmed that Section 238 overrides state electricity statutes and government priority provisions in favour of Section 53 waterfall distribution.

Legal Commentary:

Section 238 is the constitutional engine of the IBC. Without its non-obstante supremacy, the insolvency process would be paralyzed by competing claims from diverse regulatory, municipal, and revenue bodies.