MSME Form 1- Return of payment due to Micro & Small Enterprise Suppliers

Article Analyses recent MCA notification on date 22^nd January 2019 regarding ‘Micro and Small Enterprise Suppliers’ notified as Specified Companies (Furnishing of information about payment to micro and small enterprise suppliers) Order, 2019

As per the Latest Notification, the company shall submit a half yearly return to the Ministry of Corporate Affairs by stating the details of the amount of payment due to Micro and Small Enterprise Suppliers along with the reason of delay. The clarification of said notification as in following points:

i) The companies who get supplies of goods or services from Micro and Small enterprise suppliersshall file a return;

ii) The return shall include the details of:

-the amount of payment due with having the reasons of such delay, exceeding 45 days from the date of acceptance or date of deemed acceptance of the goods or services.

iii) The return shall be filed in prescribed e-form “MSME FORM 1”.

NOTE: the e-form “MSME FORM 1” will be available soon on MCA Portal.

Purpose of return:  provide details of “Amount of Payment due and Reason of delay” to the Registrar of the Companies.

Required E-form:

MSME FORM 1 – Form for furnishing half yearly return with the registrar in respect of outstanding payments to Micro or Small Enterprises.

Applicable Section:

Section 405- Power of Central Government to Direct Companies to Furnish Information or Statistics.

Applicability:

The Companies who get supplies of goods or services from Micro and Small enterprise suppliers and whose payments to Micro and Small enterprise suppliers is outstanding exceed 45 days from the date of acceptance or the date of deemed acceptance of the goods or services as per the provisions of section 9 of the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006) (hereafter referred to as “Specified Companies”).

Note: only Micro and Small Enterprise Suppliers are considered. Medium Enterprise suppliers are not considered as per the notification. 

Filing Period:

1. Every specified company shall file in e-form MSME Form 1 details of all outstanding dues to Micro and Small enterprise suppliers existing on the date of notification of this order within 30 days from the date of publication (22.01.2019) of this notification. (one time return);

2. Half yearly return:Every specified company shall file a half yearly return in e-from MSME Form 1 as:  

 Penal Provision:

Attention is drawn to provision of sub section 4 of section 405 of Companies Act, which provide for punishment for any information statistics which is incorrect or incomplete in any material respect i.e. 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.

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.

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PCS JYOTI ARYA – Email: [email protected]