IBC Section 243: Repeal of certain enactments and savings

Section 243 of Insolvency and Bankruptcy Code, 2016: Repeal of certain enactments and savings

Official Bare Act Text

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

(1) The Presidency Towns Insolvency Act, 1909 (3 of 1909) and the Provincial Insolvency Act, 1920 (5 of 1920) are hereby repealed.

(2) Notwithstanding the repeal under sub-section (1),-

(i) all proceedings pending under and relating to the Presidency Towns Insolvency Act, 1909 (3 of 1909), and the Provincial Insolvency Act 1920 (5 of 1920) immediately before the commencement of this Code shall continue to be governed under the aforementioned Acts and be heard and disposed of by the concerned courts or tribunals, as if the aforementioned Acts have not been repealed;

(ii) any order, rule, notification, regulation, appointment, conveyance, mortgage, deed, document or agreement made, fee directed, resolution passed, direction given, proceeding taken, instrument executed or issued, or thing done under or in pursuance of any repealed enactment shall, if in force at the commencement of this Code, continue to be in force, and shall have effect as if the aforementioned Acts have not been repealed;

(iii) anything done or any action taken or purported to have been done or taken, including any rule, notification, inspection, order or notice made or issued or any appointment or declaration made or any operation undertaken or any direction given or any proceeding taken or any penalty, punishment, forfeiture or fine imposed under the repealed enactments shall be deemed valid;

(iv) any principle or rule of law, or established jurisdiction, form or course of pleading, practice or procedure or existing usage, custom, privilege, restriction or exemption shall not be affected, notwithstanding that the same respectively may have been in any manner affirmed or recognised or derived by, in, or from, the repealed enactments;

(v) any prosecution instituted under the repealed enactments and pending immediately before the commencement of this Code before any court or tribunal shall, subject to the provisions of this Code, continue to be heard and disposed of by the concerned court or tribunal;

(vi) any person appointed to any office under or by virtue of any repealed enactment shall continue to hold such office until such time as may be prescribed; and

(vii) any jurisdiction, custom, liability, right, title, privilege, restriction, exemption, usage, practice, procedure or other matter or thing not in existence or in force shall not be revised or restored.

(3) The mention of particular matters in sub-section (2) shall not be held to prejudice the general application of section 6 of the General Clauses Act, 1897 (10 of 1897) with regard to the effect of repeal of the repealed enactments or provisions of the enactments mentioned in the Schedule.

Legal Commentary & Landmark Judgments: Section 243

Section 243 repeals archaic insolvency statutes (Presidency Towns Insolvency Act, 1909 and Provincial Insolvency Act, 1920) while preserving ongoing proceedings.

Repeal of Colonial Insolvency Enactments: Repeals the Presidency Towns Insolvency Act, 1909 and the Provincial Insolvency Act, 1920 in their entirety.
Statutory Savings Clause: Explicitly saves pending insolvency proceedings instituted under the repealed statutes prior to the commencement of Part III of the Code.
Harmonious Transition: Ensures that older individual insolvencies continue to be administered under repealed regimes until formally concluded or transferred.

Key Landmark Precedents:

State Bank of India v. V. Ramakrishnan (2018) 17 SCC 394: The Supreme Court analyzed Section 243, noting that the Code completely modernizes individual insolvency by repealing century-old, fragmented colonial statutes.
Swiss Ribbons Pvt. Ltd. v. Union of India (2019) 4 SCC 17: Highlighted that repealing archaic laws under Section 243 created a unified, modern insolvency code across the whole of India.

Courtroom Practice & Strategic Litigation Guidance:

Litigants with insolvency matters initiated under the 1909 or 1920 Acts must continue before the civil court or High Court under the savings provisions of Section 243(2) unless specifically notified for transfer.