The Ministry of Corporate Affair (MCA) vide notification dated January 22, 2019 had directed all the Companies, who have received any supply of goods or services from Micro or Small enterprises (MSME) and the payment against the said supply of goods or service is overdue for more than 45 (forty five) days, then such companies shall submit a return i.e. MSME Form I with the concerned Registrar of Companies ( “the ROC” ).

Given below is the FAQ on the submission of said MSME Form I 

1) What is MSME Form I The MSME Form I is filed for furnishing the details with the ROC in respect to the payment outstanding for more than 45 days towards the services availed from the said MSME.

The Form is being filed in the intervals as mentioned below:

  • Initial Return; or
  • Regular Half Yearly Returns

2) What is Micro or Small EnterprisesThe Micro or Small Enterprises are small sized entities, defined in terms of their size of investment.

Given below is the ceiling of the size of investment:

Classification Ceiling on Investment in Plant and Machinery (in INR) for enterprises engaged in or production, processing or preservation of goods  Ceiling on Investment in equipment (in INR) for enterprises engaged in service sector
Micro Below INR 25 lakhs Below INR 10 lakhs
Small More than INR 25 lakh but does not exceed INR 5 crores. More than Rs.10 lakh but does not exceed Rs. 2 crores.

The enterprises who under the abovementioned criteria and are registered under the MSME Act, 2006 are called the Micro or Small Enterprises.

3) Applicability / which Companies are required to file the MSME Form I –All the Companies i.e. public, private, listed or unlisted etc., who get supplies of goods or services from micro and small enterprises i.e MSME’s and whose payments to such MSME’s are overdue for more than forty five days from the date of acceptance or the date of deemed acceptance of the goods or service.

4) Exemption: The medium size enterprises are not covered under the notification. Here it means that the details of outstanding amount towards the supply of goods or service as availed from medium enterprises are not required to be disclosed in MSME Form I.

5) What is the date of acceptance of goods and service:The date of acceptance means the date of actual delivery of goods or rendering of services.

Further, where any objection is made in writing by the buyer regarding acceptance of goods or services within 15 (fifteen) days from the day of delivery of goods or the rendering of services, then the day on which such objection is removed by the supplier shall be the date of acceptance of goods and services.

6) What is the deemed date of acceptance of goods and service: The deemed date of acceptance means, where no objection is made in writing by the buyer regarding acceptance of goods or services within 15 (fifteen) days from the day of the delivery of goods or the rendering of services.

7) What is the initial return of MSME Form I:Initial filing of MSME Form I within 30 days from the date of its deployment or later is called the initial return of MSME Form I. The date of the deployment of the form is May 01, 2019.

8) What is the regular half yearly return of MSME Form I: Regular filing of MSME Form I on half year basis i.e. April to September or October to March is called the half yearly return of MSME Form I.

9) What is the time line to file the initial return and the half yearly return of MSME Form I: – 

  • Initial return: May 30, 2019
  • Regular half yearly returns: 31st October for the period from April to September and 30th April for the period from October to March.

10) What are the details to be furnished in MSME Form I: 

  • Name of supplier;
  • PAN of supplier;
  • Amount due against the supplies of goods or services;
  • Date from which the amount is due;
  • Reason of delay in payment of the amount due;

11) Whether MSME Form I can be filed with ‘Zero’ outstanding amount:No, MSME Form I cannot be filed with zero or NIL outstanding amount.

12) How to identify whether creditors entity or the suppliers of goods or services falls under Micro and Small or notThe Company must ask the creditor’s entity or the suppliers of goods or services whether they are registered under the Micro, Small and Medium Enterprises Development Act, 2006. If yes, the Company must ask for the MSME Registration Certificate along with the declaration that during the period of supply of goods or the services, they were falling under the definition of micro or small enterprises.

13) Who can digitally sign the MSME Form I: Any of Director, Manager, Secretary, CEO or CFO of the Company whose signature is registered on the MCA Portal may digitally sign the MSME Form I.

14) What is the statutory fee for the filing of MSME Form I:NIL

15) What is the additional fee (late fee) for delay filing of MSME Form I:NIL

16) What is the penalty for furnishing any information or statistics which is incorrect or incomplete in any material respect:The Company shall be punishable with fine which may extend to twenty-five thousand rupees and every officer of the company who is in default, shall be punishable with imprisonment for a term which may extend to six months or with fine which shall not be less than twenty-five thousand rupees but which may extend to three lakh rupees, or with both.

17) What is the procedure for filing the initially return i.e. MSME Form I:

Step-1: The Company must identify the creditors or its suppliers supplying goods or services, whose payment is more than 45 days overdue as on January 22, 2019.

Step-2: The Company must ask the Micro or Small Enterprises Registration Certificate from the creditors or suppliers identified in Step-1. 

Step-3: If any of the creditors or suppliers supplying goods or services is found registered under MSME Act 2016 and his payment is more than 45 days overdue as on January 22, 2019, the Company shall submit the MSME Form I with the given below information:

> Name of supplier;

> PAN of supplier;

> Amount due against the supplies of goods or services;

> Date from which the amount is due;

> Reason of delay in amount of payment due

Disclaimer: The entire contents of this article have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation. All Readers are advised to refer relevant provision of law before applying or accepting any of the point mentioned above or not. Author accepts no responsibility whatsoever and will not be liable for any losses, claims or damages which may arise because of the contents of this write up.

The author is Company Secretary in Practice and reached at csparveenchoudhary@gmail.com, parveen@hja.co.in, Cell No. +91 9716672473.

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Qualification: CS
Company: HJA & Associates LLP
Location: New Delhi, New Delhi, IN
Member Since: 01 May 2019 | Total Posts: 2

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17 Comments

  1. Monika Shah says:

    The Company made payment after 45 days (as per their 90 days terms) but no outstanding as on 30.09.2019. For that company has to file MSME form or not?

  2. P krishnan says:

    Sir
    We have filed the initial return with the details of outstandings as on 22.1.2019. What if the same vendors are not paid as on 31.3.2019, will the same amount be carried forward in the return for Oct to march 2019 or only fresh MSME over 45 days will be considered

  3. Jigna Sanghavi says:

    Sir, I have filed Initial return as there was outstanding MSME creditors as on 22.01.2019 for more than 45 days. However there was no outstanding MSME creditors on 31.03.2019 so whether It is compulsory to file half yearly return since initial return has been filed. if yes then in half yearly return nil or 0 outstanding cannot be able to write then what is to be done. Please advise.

    1. Parveen Choudhary says:

      Please note that if there was no outstanding balance as on March 31, 2019 as well as no payment was overdue for more than 45 days, towards the Micro or Small enterprises, then it is not required to file half yearly return.

  4. CS Omprakash Kimbahune says:

    Dear sir, Thanks for article.want to ask some queries
    I) 1) We have to check outstanding on 22/01/19 2) whose payment is more than 45 days overdue as on January 22, 2019? Is this correct? II) If we have 70 vendors, but responded only 20 vendors that they have MSME registered? then in this case what about remaining vendors?

    1. Parveen Choudhary says:

      Query-1: We have to check outstanding on 22/01/19 2) whose payment is more than 45 days overdue as on January 22, 2019? Is this correct?
      Reply-1: Yes, it is correct that in case of one-time return, we have to check the outstanding amount as on January 22, 2019

      Query-2: If we have 70 vendors, but responded only 20 vendors that they have MSME registered? then in this case what about remaining vendors?
      Reply-2: It is the responsibility of the Company to ascertain MSME suppliers even though MSME suppliers are not responding over the mail.

  5. Tanayjeet Das says:

    Thank You Sir for the article. However, there is one small doubt.

    What will the “Date from which the amount is due” be?
    Is it the date of receipt of goods/services OR is it 45 days from such date of receipt, i.e. the last date for making payment as per MSME Act.
    Kindly guide me.

    1. Parveen Choudhary says:

      Please note that the 45 days shall be counted from the date of actual delivery of goods or rendering of services.
      Further, where any objection is made in writing by the buyer regarding acceptance of goods or services within 15 (fifteen) days from the day of delivery of goods or the rendering of services, then the 45 days shall be counted from the day on which such objection is removed by the supplier.

    1. Parveen Choudhary says:

      Query :- What if balance was overdue from 2018 and still it is due on 22.01.19 so it should be reported or not
      Reply :- Yes, it should be reported subject to the condition that it is against the supply of goods or services from Micro or Small enterprises.

  6. Shubham Kumar says:

    Thanks Sir, for the article. Whereas there is one query w.r.t. MSME FORM-1 i.e. If there is no such dues appears as on 22/01/2019 and also Nill form can’t be filed, in that case, how a company will inform the MCA about such matter? Also what shall be the evidences to be arranged for future in this case if ROC asks for documents or conducts verification of the Documents u/s 206 of CA, 2013. Pl endow with your opinion.

    1. Parveen Choudhary says:

      Query-1: If there is no such dues appears as on 22/01/2019 and also Nill form can’t be filed, in that case, how a company will inform the MCA about such matter?
      Reply-1: It is not required to inform the MCA if the payment towards the Micro or Small enterprises, against the supply of goods or service, is not overdue for more than 45 (forty five) days.

      Query-2: What shall be the evidences to be arranged for future in this case if ROC asks for documents or conducts verification of the Documents u/s 206 of CA, 2013?
      Reply-2: The Company must obtain the registration confirmation letter from all its vendors and should keep it in the safe custody. On the basis of confirmation letter received from the vendors, the Company must provide the details in MSME Form I. Here it means that there must be some back up documents with the Company on the basis of which the Company is filing the MSME Form 1.

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