The IOC had been corresponding regularly for months with the Indian body in a bid to help finalize a new constitution but the situation had reached an impasse during a crucial period with the Asian Games, Commonwealth Games and the Winter Olympics all scheduled for 2014.
India, which can hope to have its suspension lifted once the IOC approves the new constitution, had moved dangerously close to becoming the first country to be kicked out of the Olympic movement since South Africa was expelled for its racial segregation policies more than 40 years ago.
The IOC President Thomas Bach told The Associated Press in an interview Saturday that it was set to withdraw recognition of the IOA if it failed to comply with "rules of good governance" before an IOC meeting in Lausanne on Tuesday when India's case was set to be discussed.
The Indian body has not been receiving IOC funding. Its officials have been banned from attending Olympic meetings and events and India's athletes can't compete in Olympic events under their national flag.
De-recognition of the Indian body would have left the country without an Olympic movement and participation of its athletes in top events under threat. There was also the possibility of other world sports governing bodies banning Indian sports federations.