Section 238 of the Insolvency and Bankruptcy Code, 2016 - Provisions of the Code to Override Other Laws

Section 238 of the Insolvency and Bankruptcy Code, 2016 (IBC) is the Code's overriding provision. It gives the IBC effect where there is an inconsistency between a provision of the Code and another law for the time being in force, or an instrument having effect by virtue of such law.

Text of Section 238 - 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.

Meaning of Section 238 of the IBC

Section 238 contains a non-obstante clause. The words "notwithstanding anything inconsistent therewith" indicate legislative priority for the IBC when its provisions cannot operate consistently with another law or an instrument deriving legal effect from another law.

The overriding effect is tied to inconsistency. Section 238 does not state that every provision of every other law automatically becomes inapplicable whenever the IBC is invoked. The relevant provisions must be examined to determine whether an inconsistency or conflict exists in the particular legal context.

What Is a Non-Obstante Clause?

A non-obstante clause is a legislative device generally used to give the provision containing it overriding operation over contrary or inconsistent provisions identified by its wording. In Section 238, the clause gives effect to the IBC despite anything inconsistent with it in another law for the time being in force or in an instrument having effect under such law.

What Does "Instrument" Mean in Section 238?

Section 238 extends beyond another statute and also refers to an instrument having effect by virtue of any such law. Whether a particular document or arrangement qualifies as such an instrument, and whether it is inconsistent with the IBC, depends on its legal source, terms and the circumstances of the case.

How the Overriding Effect Operates

The IBC must contain a provision relevant to the issue in dispute.
Another law or legally effective instrument must operate inconsistently with that IBC provision.
To the extent of the inconsistency, Section 238 gives effect to the IBC.
The existence and extent of inconsistency must be determined in the context of the provisions and facts involved.

Supreme Court Approach to Section 238

The Supreme Court has repeatedly considered Section 238 while resolving conflicts between the IBC and other statutory regimes. The decisions emphasize the overriding language of Section 238 where an actual inconsistency exists, while the result in each case depends on the provisions and legal relationship under consideration.

IBC and Other Statutory Recovery or Regulatory Regimes

Judicial decisions have applied Section 238 in disputes involving other statutory regimes, including questions concerning government dues, customs law, regulatory requirements and instruments operating under other enactments. These decisions should be read in their factual and statutory context rather than as a rule that every other enactment is displaced in all insolvency matters.

Practical point: Section 238 is an overriding clause, but its application requires identification of the specific inconsistency. The relevant IBC provision, the competing law or instrument, applicable amendments and binding judicial decisions should be examined together.

Section 238 and the IBC Framework

The overriding clause supports the functioning of the insolvency and bankruptcy framework where inconsistent legal requirements would otherwise prevent the Code from operating according to its statutory scheme. It should be read with the substantive IBC provision governing the particular issue, rather than in isolation.

Related IBC Provisions

For the surrounding provisions of the Code, see Section 236 - Trial of offences by Special Court, Section 237 - Appeal and revision, Section 239 - Power to make rules and Section 240 - Power to make regulations.

Current Legal Framework

The Insolvency and Bankruptcy Code has undergone amendments since its enactment in 2016, including amendments in 2026. Section 238 should therefore be applied with the current text of the Code and the substantive provision relevant to the dispute. Current Acts, notifications, regulations, circulars and other legal-framework material are available from the Insolvency and Bankruptcy Board of India and official legislative sources.

Legal framework reviewed with reference to the Insolvency and Bankruptcy Code, 2016 and the IBC legal framework available in 2026.