With the objective of promotion and development and enhancing the competitiveness of small and micro enterprises, the Central Government vide notification dated 2nd November, 2018 has directed that “all Companies, who get supplies of goods or services from micro and small enterprises and whose payments to micro and small enterprise suppliers exceed forty five days (i.e. forty six days in all) from the date of acceptance or the date of deemed acceptance of the goods and services shall furnish details about the amounts due and the reasons for delay thereof.”

In this article, we shall further discuss about the various FAQs of the aforesaid notification:

FAQs on Filing of MSME Form I

1. What are Micro, Small and Medium (MSME) Enterprises?

In accordance with Micro, Small and Medium Enterprises Development Act, 2006, the manufacture and service enterprise is defined in terms of investment in plant & machinery and services respectively as micro, small and medium enterprise as explained below:

Micro Small Medium
Manufacturing Enterprises Up to Rs. 25 lacs More than Rs. 25 lacs but up to Rs. 5 crores More than Rs. 5 crores but upto Rs. 10 crores
Service Enterprises Up to Rs. 10 lacs More than Rs. 10 lacs but up to Rs. 2 crores More than Rs. 2 crores but up to Rs. 5 crores

It is important to note trading enterprises are not covered under MSME. Further, the discussed notification is applicable only on micro and small enterprises and information w.r.t. medium enterprise is not required to be furnished.

2. What are Specified Enterprises as per the notification?

All companies:

  • Who get supplies of goods or services from micro and small enterprises, and
  • Whose payments to such micro and small enterprises are due for a period exceeding 45 days i.e. 46 days in all shall be referred to as the Specified Enterprises.

3. What does “date of acceptance” mean?

In accordance with MSME Act, 2006, “the day of acceptance” means-

  • the day of the actual delivery of goods or the rendering of services; or
  • where any objection is made in writing by the buyer regarding acceptance of goods or services within fifteen days from the day of the delivery of goods or the rendering of services, the day on which such objection is removed by the supplier.

4. What does “date of deemed acceptance” mean?

In accordance with MSME Act, 2006, “the day of deemed acceptance” means where no objection is made in writing by the buyer regarding acceptance of goods or services within fifteen days from the day of the delivery of goods or the rendering of services, the day of the actual delivery of goods or the rendering of services.

5. What is required to be filed?

Every specified Company shall file information w.r.t. amounts of payment due and the reasons of the delay in payment to small and micro enterprises as on 22.01.2019 (onetime) and after every half year in MSME Form I.

6. What is the due date for filing of MSME Form I?

The MSME Form I is required to be filed as following:

  • One time within 30 days of the publication of notification i.e. latest by 20th February, 2019 as the date of publication of notification is 22nd January, 2019.
  • At the end of every half year within 30 days i.e. by 31st October for the period from April to September and by 30th April for the period from October to March.

7. What information is required to be furnished in MSME Form I?

  • Total outstanding amount due as on date of notification of this order i.e. 22.01.2019 for one time return and the dues during April to September and October to March.
  • Following details of the suppliers:
  • Financial Years/Particulars
  • Name of Suppliers
  • PAN of Suppliers
  • Amount Due
  • Specify the date from which amount is due
  • Reasons for Delay in amount of payments due

8. Who shall sign the MSME Form I?

The Form can be digitally signed by Director, CEO or the company secretary in full time employment of the Company.

9. Whether all Companies has to file MSME Form I? 

No, only the specified Companies as elaborated in point no. 2 as mentioned above has to file MSME Form I.

10. Whether the micro and small suppliers for which information is required to be furnished shall be registered under MSME Act, 2006?

No, in the discussed notification, nothing is mentioned w.r.t. registration under MSME Act, 2006 and accordingly, we may opine that any enterprises falling under the limits of micro and small enterprises as specified in point no. 1 shall be the one for which information is required to be furnished.

To conclude, we can say that now every Company has to be aware whether the supplier from which it deals falls under the category of small and micro enterprises as the government is day by day emerging with new laws for protection and promotion of such enterprises.

{The author is a Company Secretary in Practice and can be reached at (M) 9999952595 and (E) cskajalgoyal@gmail.com}

 

Author Bio

Qualification: CS
Company: Kajal Goyal and Associates
Location: Delhi, New Delhi, IN
Member Since: 11 Jun 2018 | Total Posts: 28
KAJAL GOYAL AND ASSOCIATES, is a Company Secretary proprietorship firm, offering its expertise and one stop solutions for all Corporate compliance requirements to the clients with a strong emphasis on ethics and ‘being on toes’. Capable delivering services related to Companies Act, FEMA, Re View Full Profile

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5 Comments

  1. SURRENDER KUMAR SINGAL says:

    Major Buyer of MSEs’ production being Govt. Enterprises including Railway & Defence Establishments, which may not be covered under Company Laws, SURELY need to be covered by this or another similar notification ?? Jai Shree Ram !

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