WHY Form MSME-1

The introduction of MSME-1 is another initiative by the present government to strengthen the micro and small enterprises by prescribing a mandatory filing regime twice a year by their large customers.

The Order stated that, all companies who get supplies of goods/services from Enterprises and whose respective payments to such Enterprises exceed forty- five days from the date of acceptance or the date of deemed acceptance of such goods/ services (hereinafter referred to as “Specified Companies“), are required to submit a half yearly return to the MCA stating the amount of payment due and the reasons for the delay. The Order required all Specified Companies to furnish details of all such outstanding dues by filing MSME 1.

WHAT IS MSME

Small, Micro and Medium Enterprises

Section 7 of the Micro, Small and Medium Enterprises Development Act, 2006 defines the micro, small and medium enterprises as follows:

Manufacturing Sector

The term enterprises cover companies, partnership firm, Association of Person, Hindu Undivided Family, co-operative society, proprietorship firm etc.

It is to be noted that MSME FORM 1 is not applicable in the case of outstanding sums due to medium enterprises.

IMMEDIATE DUE DATE

The Last date of filing MSME-1 for the half year ended 31st March 2020 (October 2019- March 2020) is 30th April 2020 unless extended by MCA considering present prevailing situations. This is applicable to all specified companies.

PROCEDURE TO FILE MSME FORM

Some Important Points to be considered for filing the form:

This is the time for regular half yearly return since initial return had already been filed in the year 2019.

The form captures the outstanding amount as on 31st March 2020 plus any payment made beyond 45 days. The invoice can belong to any period other than the corresponding above second half year 2020.

The total outstanding amount needs to be mentioned in the column no- 4(a) of the form. The outstanding amount includes principal and interest thereon as well.

In the column 4(b), the form focusses on the delayed amount information i.e. Payment due and above 45 days + Payment made after 45 days

(1) Details of the supplier to whom the amount is Outstanding as on 31st March 2020 and the due is more than 45 days and payment is not made.

(2) In case, any payment is made during this six-month period, second half year 2020 (i.e October 2019 –March 2020) and there is delay of more than 45 days.

The amount mentioned in col 4(a) may not tally with 4(b).

NIL returns are not required to be filed as the form MSME-1 will not capture “ ZERO”

PENALTY

Penal provisions for non-filing /wrong information will be penalized under section 405 of he companies act 2013 and penalty under MSME act.

A failure to comply with the Order, shall attract a fine which is extendable to twenty-five thousand rupees. Further, any officer in default of the Specified Company shall be punishable with imprisonment which can extend to a period of six months or fine which can extend to three lakhs rupees, but not less than twenty-five thousand rupees or both.


Format of Request for confirmation for the applicability of the Micro, Small and Medium Enterprises Development Act, 2006.

ABC COMPANY PRIVATE/ LIMITED,
Regd Address : XX XX XXX

Date  XX/XX/2020

M/S XYZ (Proprietorship/ Partnership)
NDH
Delhi -1100XX

Sub:  Request for confirmation for the applicability of the Micro, Small and Medium Enterprises Development Act, 2006.

Dear Sir,

As you may be aware, the Government of India has enacted the Micro, Small and Medium Enterprises Development Act, 2006 (Act).

We request you to confirm whether your organization is registered under the Micro, Small and Medium Enterprises Development Act, 2006. If your organization is registered under the Act, specify the category and please put a tick in the box [   ] against the appropriate clause mentioned below.

(A) Type of Organization

1. Micro Enterprises      [   ] Registration No:.  ……………………………………………………

2. Small Enterprises      [   ] Registration No:.  ……………………………………………………

3. Medium Enterprises [   ] Registration No:. ……………………………………………………

(B) PAN Number:         …………………………………………………………

(C) eMail ID:                  …………………………………………………………

(D)  Mobile No:             …………………………………………………………

Kindly enclose a copy of valid registration certificate and PAN and send to us at below mentioned Corporate office address or mail it within 7 days from the date of receipt of this letter so that we receive it by XX XX, 2020.

If you take registration under MSMED Act 2006 in future you shall inform to ABC Company Private/ Limited along with a copy of registration certificate within 2 days from the date of receipt of MSMED registration certificate.

Thanking You,

Yours faithfully

For  ABC COMPANY PRIVATE/ LIMITED

Accounts Manager
Mail Id
Phone  No. – xx xx xx xx xx

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3 Comments

  1. atulke@gmail.com says:

    Under General Circular No. 11/2020 dated 24th March 2020 issued by MCA, the dates ofor filing of all compliances automatically stand extended till 30th Sept 2020, so the question of any specific exemption for filing of MSME form does not arise. The author may take note of this.

    1. sandip says:

      But the list specifying forms does not include MSME other forms are included.
      Further, order dated 30.03.2020 also not mentioned. Request to clarify.

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