Section 225: Power of Central Government to Issue Directions
Section 225 of the Insolvency and Bankruptcy Code, 2016 governs the Central Government's power to issue written directions to the Insolvency and Bankruptcy Board of India (IBBI) on questions of policy. It also provides an opportunity for the Board to express its views, as far as practicable, before such a direction is issued.
Law status: Updated with reference to the IBC legal framework available as on 30 September 2026.
Text of Section 225 of the Insolvency and Bankruptcy Code, 2016
225. Power of Central Government to issue directions.
(1) Without prejudice to the foregoing provisions of this Code, the Board shall, in exercise of its powers or the performance of its functions under this Code, be bound by such directions on questions of policy as the Central Government may give in writing to it from time to time:
Provided that the Board shall, as far as practicable, be given an opportunity to express its views before any direction is given under this sub-section.
(2) The decision of the Central Government as to whether a question is one of policy or not shall be final.
Meaning and Scope of Section 225
Section 225 creates a statutory mechanism for policy-level directions from the Central Government to the Board. The expression "Board" refers to the Insolvency and Bankruptcy Board of India established under Section 188 of the Code. IBBI is the statutory regulator responsible for performing the functions assigned to it under the Code.
1. Directions must concern questions of policy
The power under Section 225 is framed specifically in relation to questions of policy. When exercising its powers or performing its functions under the Code, the Board is bound by written directions given by the Central Government on such policy questions.
2. Directions must be in writing
Sub-section (1) expressly requires the Central Government's directions to be given in writing. This requirement places the policy direction on a formal and identifiable record.
3. Opportunity for IBBI to express its views
The proviso to Section 225(1) states that, as far as practicable, the Board must be given an opportunity to express its views before a direction is issued. The provision therefore contemplates consultation with the Board before the Central Government gives a policy direction, subject to the statutory qualification "as far as practicable".
4. Finality on whether a question is one of policy
Under Section 225(2), the decision of the Central Government on whether a particular question is a question of policy is declared final by the Code.
Key Points
- Section 225 concerns directions by the Central Government to IBBI on questions of policy.
- A direction under Section 225(1) must be in writing.
- IBBI is bound by such policy directions while exercising its powers and performing its functions under the Code.
- As far as practicable, IBBI must be allowed to express its views before the direction is given.
- The Central Government's decision on whether a question is one of policy is final under Section 225(2).
Position within the IBC
Section 225 appears in Part V of the Insolvency and Bankruptcy Code, 2016. The surrounding provisions deal with matters including the Insolvency and Bankruptcy Fund, supersession of the Board, financial service providers, the Board's budget, annual report and delegation. For the wider statutory context, see the linked provisions in the sidebar.