Section 198 of the Insolvency and Bankruptcy Code, 2016: Condonation of Delay
Section 198 gives the relevant Adjudicating Authority a specific power to condone delay where the Insolvency and Bankruptcy Board of India does not perform an act within the period specified under the Code. The Adjudicating Authority must record its reasons in writing.
Section 198 - Statutory Provision
Notwithstanding anything contained in this Code, where the Board does not perform any act within the period specified under this Code, the relevant Adjudicating Authority may, for reasons to be recorded in writing, condone the delay.
Meaning and Scope of Section 198
Section 198 begins with a non-obstante clause, but the subject of the provision is specifically a delay by the Board in performing an act within a period prescribed by the Insolvency and Bankruptcy Code. It enables the relevant Adjudicating Authority to condone that delay after recording reasons in writing.
Who Can Commit the Delay Covered by Section 198?
The statutory text refers to a situation where "the Board" does not perform an act within the period specified under the Code. In this context, the Board means the Insolvency and Bankruptcy Board of India established under Section 188 of the Code.
Who Can Condon the Delay?
The power is conferred on the "relevant Adjudicating Authority." The identity of the Adjudicating Authority depends on the part of the Code and the person or process concerned. For corporate persons, Section 60 identifies the National Company Law Tribunal having territorial jurisdiction as the Adjudicating Authority. For individuals and partnership firms, the Code contains the applicable adjudicatory framework in Part III.
Reasons Must Be Recorded in Writing
Condonation is not automatic. Section 198 expressly requires reasons to be recorded in writing when the relevant Adjudicating Authority exercises the power to condone the Board's delay.
Recent Interpretation by NCLAT
In 2026, the National Company Law Appellate Tribunal considered the scope of Section 198 in Insolvency and Bankruptcy Board of India v. Truvisory Insolvency Professionals Pvt. Ltd. The Tribunal explained that Section 198 concerns failure by the Board to perform a function within a period specified under the Code. It distinguished that statutory situation from limitation for filing an appeal under Section 61 and held that Section 198 could not be used to extend the statutory appellate limitation on that basis.
Section 198 at a Glance
| Element | Legal Position |
|---|---|
| Opening words | Contains a non-obstante clause: "Notwithstanding anything contained in this Code". |
| Delay covered | Failure by the Board to perform an act within a period specified under the Code. |
| Authority | The relevant Adjudicating Authority. |
| Nature of power | The Adjudicating Authority "may" condone the delay. |
| Reasoned order | Reasons for condonation must be recorded in writing. |
Related IBC Provisions
Section 188: Establishment and incorporation of the Insolvency and Bankruptcy Board of India.
Section 196: Powers and functions of the Board.
Section 60: Adjudicating Authority for corporate persons.
Section 61: Appeals and the statutory limitation framework applicable to appeals to the Appellate Tribunal.
Section 238: Gives the Code overriding effect where its provisions are inconsistent with other laws or instruments having effect by virtue of such laws.
Official Legal Resources
India Code - Central Acts and Legislation