Section238
The Insolvency and Bankruptcy Code, 2016
Provisions of this Code to override other laws
In force
Act 31 of 2016
As on 15 Oct 2026
Section 238 of the Insolvency and Bankruptcy Code, 2016 deals with provisions of this Code to override other laws. 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. The Act was enacted on 28 May 2016.
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.
Section 238, The Insolvency and Bankruptcy Code, 2016 (Act 31 of 2016).
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Innoventive Industries Ltd. v. ICICI Bank
Court's Decision & Legal Precedent
Once a financial creditor shows a debt and default under IBC s.7, the Adjudicating Authority must admit the application if complete; there is no discretion to go into the merits of a pending state-relief statute. IBC s.238 overrides inconsistent Maharashtra Relief Undertaking law. Use Judgement order-7.pdf, not same-date order-6.pdf ROP.
On this section: IBC overrides inconsistent Maharashtra Relief Undertaking legislation.
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Sundaresh Bhatt vs Central Board of Indirect Taxes and Customs
Court's Decision & Legal Precedent
Once moratorium is imposed under Sections 14 or 33(5) of the Insolvency and Bankruptcy Code, 2016, the Customs authority has only limited jurisdiction to assess and determine the quantum of customs duty and other levies. The Customs authority does not have the power to initiate recovery of dues by means of sale or confiscation as provided under the Customs Act. After such assessment, the Customs authority must submit its claims in accordance with the procedure laid down in the IBC and in strict compliance with prescribed time periods before the adjudicating authority. The Insolvency and Bankruptcy Code overrides the Customs Act to this extent, and the Liquidator can immediately secure goods from the Customs authority to be dealt with appropriately under the IBC. Additionally, the Liquidator has discretion in choosing the mode of sale of corporate assets (auction or private contract), and no vested right accrues to any bidder merely by participation in a bidding process; the Liquidator's commercial decisions regarding asset sales are not subject to judicial review.
On this section: IBC provisions override any inconsistent provision in any other law; establishes supremacy of IBC over Customs Act
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Mahendra Kumar Rajpal vs Ministry of Corporate Affairs
Court's Decision & Legal Precedent
The Central Government, acting under Section 1(3) of the Insolvency and Bankruptcy Code, 2016, has the power to bring into force different provisions of the Code at different times for different categories of persons. The 2018 Amendment Act, by creating personal guarantors as a distinct category in Section 2(e) and mandating the NCLT as the adjudicating authority in Section 60, provided sufficient legislative guidance for the Central Government to selectively apply the Code to personal guarantors to corporate debtors. The notification dated 15.11.2019 is a valid exercise of conditional legislation, not an instance of excessive delegation or impermissible legislative exercise. Personal guarantors, though individuals, are intrinsically connected to corporate debtors and warrant unified adjudication before the NCLT. The approval of a corporate resolution plan does not discharge the personal guarantor's liability, which remains enforceable as an independent contractual obligation under the Indian Contract Act, 1872.
On this section: Overriding effect of Code over other laws
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Raman Prakash Mangla vs Anuj Jain
Court's Decision & Legal Precedent
The Adjudicating Authority has limited jurisdiction in approving a resolution plan, circumscribed by Sections 30(2) and 31 of the Insolvency and Bankruptcy Code, 2016. The Authority cannot interfere with the commercial aspects of the decision taken by the Committee of Creditors. If the Adjudicating Authority finds shortcomings in the resolution plan vis-à-vis the specified parameters of keeping the corporate debtor as a going concern, maximizing the value of its assets, and taking care of interests of all stakeholders, it must send the plan back to the Committee of Creditors for reconsideration, not modify the plan itself. Payment to dissenting financial creditors must be in monetary terms, not in kind or through transfer of equity or land. Once homebuyers as a class vote in favor of a resolution plan through their authorized representative, individual homebuyers cannot challenge the plan as dissenting creditors or aggrieved persons. The INR 750 crores deposited by the holding company pursuant to Supreme Court orders in Chitra Sharma is the property of the holding company, not the corporate debtor, and cannot be appropriated by the corporate debtor or the resolution applicant.
On this section: Provisions of Code override other laws
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Action Ispat and Power Pvt. LTD vs Shyam Metalics and Energy Limited
Court's Decision & Legal Precedent
Even post-admission of a winding up petition and after appointment of a Company Liquidator to take over assets of a company sought to be wound up, discretion is vested in the Company Court to transfer such petition to the NCLT. Such discretion should be exercised based on whether irreversible steps have been taken in the winding up proceedings. If no actual sales of immovable or movable properties have taken place and the proceedings have not reached a stage making it impossible to set the clock back, the Company Court should transfer the proceedings to NCLT to be dealt with as an application for initiation of corporate insolvency resolution process under the Insolvency and Bankruptcy Code 2016, in accordance with the legislative intent to prioritize corporate revival over liquidation.
On this section: Provisions of IBC override other laws; used to justify that IBC proceedings take precedence over Companies Act winding up proceedings
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Landmark Apartments Pvt. LTD vs Union of India
Court's Decision & Legal Precedent
The Insolvency and Bankruptcy Code (Second Amendment) Act, 2018, which deems allottees of real estate projects as financial creditors under Section 5(8)(f) and provides for their representation on Committee of Creditors through authorized representatives under Sections 21(6A) and 25A, is constitutionally valid under Articles 14, 19(1)(g), and 300-A of the Constitution of India. The amendment does not violate Article 14 as allottees, who finance their own apartment projects and provide consideration for time value of money through installment-based advance payments, constitute a rationally distinct class of financial creditors similar to debenture holders and fixed deposit holders, with intelligible differentia bearing nexus to the Code's object of maximizing creditor recovery and protecting stakeholders in corporate rehabilitation. The amendment does not infringe Article 19(1)(g) as it is a reasonable restriction in public interest for protecting millions of home buyers with substantial invested amounts. The amendment does not deprive developers of property without constitutional authority as it operates through valid legal process respecting due process and defenses. The explanation to Section 5(8)(f) merely clarifies that allottees already fell within the definition's ambit and is not substantively enlarging the scope. The classification does not offend the UNCITRAL Legislative Guide as allottees are recognized as financial creditors based on genuine financing characteristics. The Code and RERA can harmoniously coexist as parallel remedies serving different purposes, with Code taking primacy due to its later non-obstante clause. Parliament's legislative judgment in treating allottees as financial creditors is entitled to judicial deference as an economic experiment within free play in joints doctrine.
On this section: Non-obstante clause giving Code overriding effect notwithstanding anything inconsistent in any other law; provides Code with primacy
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Uppal Chadha Hi Tech Developers Pvt. LTD vs Union of India
Court's Decision & Legal Precedent
Real estate allottees are 'financial creditors' within the meaning of Section 5(8) of the Insolvency and Bankruptcy Code, 2016, as they advance money against consideration for the time value of money to finance real estate construction projects. The Explanation to Section 5(8)(f) inserted by the Insolvency and Bankruptcy Code (Second Amendment) Act, 2018, is constitutionally valid as it is clarificatory of the original provision's language and does not infringe Articles 14, 19(1)(g), or 300-A of the Constitution. Allottees are entitled to trigger insolvency proceedings under Section 7 of the Code against real estate developers, and their inclusion as financial creditors does not violate principles of reasonable classification or legislative objects. The Code and RERA operate harmoniously in different spheres providing concurrent remedies to home buyers.
On this section: The Code's non-obstante clause is compared with RERA's Section 88. Unlike RERA's clause which explicitly reserves certain laws, the Code does not reserve RERA. Combined with the temporal sequence and the Code's later date, this suggests the Code prevails in case of conflict, though the two statutes are to be harmoniously construed.
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Sds Infracon PVT LTD vs Union of India
Court's Decision & Legal Precedent
Amendments to the Insolvency and Bankruptcy Code 2016 treating real estate project allottees as financial creditors are constitutionally valid under Articles 14 19 1 g and 300 A of the Constitution. Real estate allottees genuinely finance projects by advancing payments for future delivery of apartments and constitute financial creditors under Section 5 8 f as amounts raised have commercial effect of borrowing considering time value of money. The explanation to Section 5 8 f is clarificatory in nature and allottees would fall within this provision even without it. Allottees have right to trigger insolvency proceedings under Section 7 by filing applications before NCLT. Code and RERA provide concurrent and complementary remedies not conflicting jurisdictions. There is no violation of Article 14 as legitimate intelligible differentia exists between allottees and other operational creditors. There is no violation of Article 19 1 g as restriction on right to business is reasonable being in public interest of protecting allottee investments.
On this section: Code has overriding effect over other laws including RERA
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Sanjay Singal vs Union of India
Court's Decision & Legal Precedent
The impugned notification dated 15.11.2019 bringing into force provisions of the Insolvency and Bankruptcy Code, 2016 only in so far as they relate to personal guarantors to corporate debtors is a valid exercise of power conferred by Section 1(3) of the Code. The Central Government acted within its constitutional powers in selectively applying Code provisions to personal guarantors as a distinct category of individuals, as this classification was created by Parliament through the 2018 Amendment Act which amended Section 2(e) and Section 60 to provide unified adjudication of corporate debtors and personal guarantors before the NCLT. The notification does not constitute impermissible delegation of legislative power or excessive modification of statutory provisions, but rather operationalizes the Parliamentary intent to treat personal guarantors differently from other individuals due to their intrinsic connection with corporate debtors. Approval of a resolution plan relating to a corporate debtor does not operate to discharge the liabilities of personal guarantors to such corporate debtors, as the guarantor's liability is co-extensive with the principal debtor and continues notwithstanding involuntary discharge of the principal debtor by operation of law.
On this section: Code has overriding effect over other enactments
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Lalit Kumar Jain vs Union of India
Court's Decision & Legal Precedent
The Central Government, in exercise of powers conferred by Section 1(3) of the Insolvency and Bankruptcy Code, 2016, has authority to bring into force different provisions of the Code at different times for different categories of persons, including personal guarantors to corporate debtors. The 2018 Amendment Act, by creating distinct classification of personal guarantors under Section 2(e) and amending Section 60, provided sufficient parliamentary guidance for such selective application. The impugned notification, which brings into force provisions of Part III of the Code only in relation to personal guarantors to corporate debtors, is valid exercise of power conferred by Section 1(3) and does not amount to excessive delegation or modification of Code provisions. Furthermore, approval of a resolution plan for a corporate debtor does not discharge the personal guarantee liabilities of guarantors, as such liabilities arise from independent contracts of guarantee and are not discharged by involuntary discharge of principal debtor by operation of law.
On this section: Non-obstante clause giving Code overriding effect over other prevailing enactments
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Rajesh Gupta vs Nbcc (india) LTD
Court's Decision & Legal Precedent
The Adjudicating Authority's jurisdiction in approving a resolution plan is limited to verifying compliance with the mandatory requirements specified in Section 30(2) of the Insolvency and Bankruptcy Code, 2016. The Authority cannot modify the commercial terms of a resolution plan approved by the Committee of Creditors by the requisite majority (66% or more of voting share). If the Authority finds that the resolution plan does not meet the specified parameters (keeping corporate debtor as going concern, maximizing asset value, protecting stakeholder interests), it must remit the plan back to the Committee of Creditors for reconsideration rather than modifying it itself. The commercial wisdom of the Committee of Creditors is non-justiciable and cannot be interfered with by the Adjudicating Authority or Appellate Authority on equitable or quantitative grounds. Dissenting financial creditors must receive payment in monetary terms (cash) equivalent to their liquidation value, not in kind through equity or land transfers. The INR 750 crores deposited by the holding company JAL pursuant to Supreme Court orders in the Chitra Sharma case remains the property of JAL and cannot be treated as an asset of the corporate debtor JIL for purposes of the resolution plan. Homebuyers as a class are bound by the decision of their authorized representative in the Committee of Creditors under Section 25A(3A), and individual homebuyers cannot maintain separate challenges to the resolution plan. The Insolvency and Bankruptcy Code prevails over the Real Estate (Regulation and Development) Act, 2016 in case of conflict, though both statutes must be interpreted harmoniously. Concession Agreements with statutory authorities are not statutory contracts and their material terms cannot be modified without the consent of the other contracting party. Security interests not avoided under Section 43 of the Code cannot be unilaterally extinguished through a resolution plan.
On this section: Overriding effect of Code provisions over other laws; Code prevails in case of conflict with other statutes
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Vodafone Idea LTD vs Union of India Department of Telecommunications through Its Secretary
Court's Decision & Legal Precedent
The primary ratio decidendi are: (1) Spectrum constitutes a natural resource held by the government in sovereign trust and cannot be treated as property owned by corporate debtors subject to insolvency proceedings merely due to right to use granted under license; the question requires NCLT examination within two months as it is a substantial jurisdictional issue affecting the validity of insolvency proceedings initiated by telecom companies; (2) In spectrum sharing arrangements, the sharing operator has no liability for the original licensee's predecessor AGR dues as the sharing operator merely obtains right to use additional spectrum alongside its own spectrum - each operator remains liable only for AGR dues arising from spectrum it holds; (3) In spectrum trading arrangements, the buyer's liability for seller's predecessor AGR dues is determined by the Trading Guidelines - if entire spectrum is traded, buyer assumes seller's known past dues; if only partial spectrum is traded, buyer has no predecessor dues liability; any dues discovered after trade date are recoverable from buyer or seller jointly or severally at government discretion; (4) AGR dues determined by the Supreme Court judgment dated October 24, 2019 are final, binding and not subject to reassessment or fresh disputes; telecom operators must pay the determined amount through installment schedule without room for contesting the calculation; (5) The government as licensor retains sovereign privilege over spectrum allocation under Telegraph Act Section 4 and can enforce contractual conditions precedent (particularly payment of dues) before permitting license transfers or spectrum trading, notwithstanding IBC moratorium provisions, as these are conditions precedent to the right itself rather than post-right enforcement.
On this section: Non obstante clause stating IBC prevails over other laws; central to debate about whether IBC overrides Telegraph Act's sovereign privilege
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Tata Teleservices LTD vs Union of India through Its Secretary
Court's Decision & Legal Precedent
The core ratio decidendi is: (1) Spectrum is a natural resource held by Government under exclusive privilege per Section 4 of Telegraph Act, granted to licensees subject to contractual conditions including payment of AGR dues. While the question of whether spectrum can be subjected to IBC proceedings involves significant jurisdictional issues to be examined by NCLT, it is clear that AGR dues accumulated over nearly 20 years must be paid in full by all telecom service providers without dispute or reassessment. (2) Payment of these dues aggregating Rs. 1,43,271.74 crores (as calculated by Court) shall be made in 10 equal yearly installments commencing from April 1, 2021 to March 31, 2031, with 10% due by March 31, 2021. This represents modification of Government's proposal for 20-year timeline as inappropriate given the sovereign nature of spectrum rights. (3) For telecom service providers sharing spectrum under 2015 Guidelines, each operator remains liable for AGR dues proportionate to spectrum held; sharing operator bears no liability for past dues of original licensee. (4) For spectrum trading, seller must clear all pre-trading dues; buyer liable for post-trading dues except those discovered later and unknown at trading date, recoverable jointly or severally at Government's discretion. (5) All telecom service providers must pay dues without any reduction, waiver, or relief other than the approved 10-year installment schedule with NPV protection. No dispute, reassessment, or recalculation is permitted. Default in payment results in automatic interest, penalty and interest on penalty, and constitutes contempt of court. (6) The question of whether spectrum can be subjected to insolvency proceedings is a jurisdictional matter for NCLT to decide within two months, examining whether such proceedings constitute bona fide attempts at revival or subterfuge to avoid AGR payment.
On this section: Non-obstante clause stating Code overrides other laws; parties argued whether this overrides Telegraph Act and TRAI Act provisions
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Bharti Airtel LTD vs Union of India through Secretary
Court's Decision & Legal Precedent
Spectrum, being a scarce recognized natural resource held in public trust by the Central Government under its exclusive privilege granted by Section 4 of the Indian Telegraph Act, 1885, cannot be treated as property owned by a corporate debtor and therefore cannot be subjected to insolvency proceedings under the Insolvency and Bankruptcy Code, 2016. A telecom licensee possesses only contractual usage rights over spectrum granted under the license agreement, not ownership rights. These contractual rights, being under agreement with a third party (the Government) retaining interest, fall outside the definition of 'assets' under Section 18 of the IBC as per the Explanation to that section. Accordingly, spectrum cannot be transferred in resolution plans or subject to resolution proceedings, and statutory Guidelines for Spectrum Sharing and Trading issued by the Department of Telecommunications must be adhered to. However, the jurisdictional question of whether spectrum can be subjected to insolvency proceedings and whether AGR dues are operational dues under the IBC requires consideration by the National Company Law Tribunal before any further determination.
On this section: Provides that IBC provisions override other laws. Respondents argued IBC overrides Telegraph Act; court rejected this argument for spectrum issues.
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… It will be relevant to refer to the order dated 10th August 2018 passed by this Court in Special Leave Petition (Civil) No.6483 of 2018, which reads thus: "Heard. Delay, if any, is condoned. Given Section 238 of the Insolvency and Bankruptcy Code, 2016, it is obvious that the Code will override anything inconsistent contained in any other enactment, including the Income-Tax Act. We may also refer in this Connection to Dena Bank vs. Bhikhabhai Prabhudas Parekh and Co. & Ors. (2000) 5 SCC 694 and its progeny, making it …
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… The respondent have referred to the following observations of the Supreme Court in order dated 10.08.2018 in Special Leave to Appeal (Civil) No. 6483/2018, Principal Commissioner of Income Tax v. Monnet Ispat and Energy Limited :— > "Given Section 238 of the Insolvency and Bankruptcy Code, 2016, it is obvious that the Code will override anything inconsistent contained in any other enactment, including the Income-Tax Act. > We may also refer in this connection to Dena Bank v. Bhikhabhai Prabhudas Parekh and Co. (2000) 5 SCC 694 and its progeny, making it …
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… Learned counsel for the appellant states that the learned Single Judge erred in law in entertaining the Section 9 petition filed by Respondent No.1, in view of the bar contained in Sections 231, 60(5), 33(5) and 238 of the Insolvency and Bankruptcy Code, 2016. 4. Issue notice. 5. Mr. Rajat Katyal, Advocate accepts notice on behalf of Respondents. He states that the impugned order passed by the learned Single Judge no longer survives in view of the subsequent order passed by the NCLT on 31st July, 2021. He further states …
Made under this section, and citing it
1 instrument states that it was made under this provision — the power to make it comes from here, so a change to any of them changes what this section requires in practice. Newest first.
Questions about Section 238
What have the courts held on Section 238 of the Insolvency and Bankruptcy Code?
Innoventive Industries Ltd. v. ICICI Bank (31 Aug 2017) is the leading judgment on this section among those set out below: IBC overrides inconsistent Maharashtra Relief Undertaking legislation. Another 13 judgments on this section are set out below, all of them from the Supreme Court. They run from 2017 to 2022.
How do I find court cases under Section 238 of the Insolvency and Bankruptcy Code?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Insolvency and Bankruptcy Code 238, section 238 Insolvency and Bankruptcy Code, section 238 of the Insolvency and Bankruptcy Code. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 14 reported judgments on this section are set out on this page, beginning with Innoventive Industries Ltd. v. ICICI Bank (31 Aug 2017).
What should I read with Section 238 of the Insolvency and Bankruptcy Code, and has it changed?
The rules and notifications made under it are where it actually bites, and there is one: most recently Commencement of Sections related to Corporate Insolvency. (2016).
When was Section 238 of the Insolvency and Bankruptcy Code enacted?
Section 238 of the Insolvency and Bankruptcy Code, cited as Insolvency and Bankruptcy Code 238, was enacted on 28 May 2016 as Act 31 of 2016. It is in force as at the date shown on this page.
Other sections of this Act
- 240. Power to make regulations2349 words
- 5. Definitions2326 words
- 3. Definitions1381 words
- 29A. Person not eligible to be resolution applicant1152 words
- 239. Power to make rules963 words
- 196. Powers and functions of Board942 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.