Latest Micro, Small and Medium Enterprises Development Act, 2006 Amendment dated 25th March, 2025
As per the Ministry Of Micro, Small And Medium Enterprises, Notification No. S.O. 1376(E)., Dated: 25th March, 2025 “In exercise of powers conferred by section 9 of the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006) and read with section 15 of the said Act, the Central Government hereby directs 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 from the date of acceptance or the date of deemed acceptance of the goods or services as per the provisions of the said Act, shall submit a half yearly return to the Ministry of Corporate Affairs stating the following:
(a) the amounts of payments due; and
(b) the reasons of the delay.”
In earlier notification dated 22 November, 2018, Ministry of Micro, Small And Medium Enterprises make notification and state that “In exercise of powers conferred by section 9 of the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006) the Central Government hereby directs 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 from the date of acceptance or the date of deemed acceptance of the goods or services as per the provisions of the said Act, shall submit a half yearly return to the Ministry of Corporate Affairs stating the following:
(a) the amounts of payments due; and
(b) the reasons of the delay.”
Analysis of both notification:
In notification dates 22 November, 2018 the ministry only stated section 9 of the MSME Act, 2006 which state that
“The Central Government may, from time to time, for the purposes of facilitating the promotion and development and enhancing the competitiveness of micro, small and medium enterprises, particularly of the micro and small enterprises, by way of development of skill in the employees, management and entrepreneurs, provisioning for technological upgradation,marketing assistance or infrastructure facilities and cluster development of such enterprises with a view to strengthening backward and forward linkages, specify, by notification, such programmes, guidelines or instructions, as it may deem fit.”
However, they do not mention from where the requirement of payment made to the micro and small enterprises within 45 days came from.
Section 15 of MSME Act, 2006
Where any supplier supplies any goods or renders any services to any buyer, the buyer shall make payment therefor on or before the date agreed upon between him and the supplier in writing or, where there is no agreement in this behalf, before the appointed day:
Provided that in no case the period agreed upon between the supplier and the buyer in writing shall exceed forty-five days from the day of acceptance or the day of deemed acceptance.
Conclusion: Thus in latest notification dated 25th March, 2025 the Ministry of Micro, Small and Medium Enterprises state both the section 9 power to central government to make notification and section 15 about the minimum days of payment.
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