Categories: MSME

Payment security to MSME as per MSME provision

www.carajput.com; MSME Samadhaan

Payment security to MSME as per MSME provision

Section 15 of the MSME Act states that if the supplier supplies products or offers any services to any purchaser, the consumer shall make the payment on or before the date stated in the agreement and if there is no agreement before the date specified.

The MSMED Act of 2006 gives the recipient of any goods or services a 45-day credit term to reimburse the MSME provider. It is included to safeguard the interests business of MSME.

The proviso to this Section states that the credit period provided by the seller shall not exceed 45 days from the date of acceptance or from the date of acceptance deemed.

  • “Approved date” means the day immediately following the expiry of the 15-day period from the date of acceptance or the date of considered acceptance by the purchaser of any products or services from the supplier;
  • ‘Day of acceptance’ means,-

(a) the day on which goods are actually delivered or services are rendered; or

(b) where the customer poses some complaint in writing concerning the acceptance of products or services within 15 days of the day on which products are delivered or services are rendered, the day on which the supplier eliminates such complaint

  • ‘Day of deemed acceptance’ means that the buyer does not object in writing to acceptance of products or services within 15 days of the day on which the products are delivered or services are rendered, the day on which the goods are actually delivered or services are rendered;

Thus you are not entitled to pay interest under the MSME Act in respect of delayed payment.

 

MSME Provisions in India

  • Availability of collateral free loans.
  • Govt support in the form of incentives & subsidies.
  • Lower rate of interest.
  • Priority in case of registration & compliance approvals by Central & State Govt.

What are the class of Person or Entities Covered under MSME?

Types of person covered under MSME are:

  • Hindu Undivided Family
  • Co-operative Society
  • Proprietorship
  • Partnership Firm
  • Association of Persons
  • Company

MSMEs  Obligations

Below documents must be completed in order to be registered as an MSME under the prescribed Act:

  • Pan of Company/Firm Pan Card (in case of Company/Firm), Pan Card of the Applicant (if a proprietor);\
  • Aadhar Card of the Applicant.
  • AOA & MOA
  • Bank Account Details
  • Office and Plant Locations address and proof
  • Bills of the equipment employed

Penalty- Non-compliance

  • Non-compliance is punishable under Section 405(4) of the Companies Act, 2013, by a fine of up to INR 25k on the company.
  • Furthermore, any official who violates the Specified Company’s rules is subject to imprisonment for up to six months or a fine ranging from INR 25k to INR 3 lakhs, or both.

MSMEs payment must clear within 45 Days

According to the laws, As per this amendment, any amount Payable by an Assessee to Micro Small and Medium Enterprises supplier beyond the time limit prescribed in section 15 of the MSMED Act shall be allowed as a deduction in the year in which actual payment has been made. Large companies have to pay MSMEs within 45 days of obtaining products or services, or within 15 days in the absence of a written agreement. Govt of India makes it compulsory to clear all dues of MSMEs within 45 days –

Why trust Rajput Jain & Associates to register for MSME?

  • There are no hidden charges
  • End to end assistance & support.
  • Customer satisfaction is our primary goal.
  • We have a team of qualified & experienced staff.
  • Best services are provided at a reasonable price

Popular Articles :

Rajput Jain & Associates

Rajput Jain & Associates is a Chartered Accountants firm, with it's headquarter situated at New Delhi (the capital of India). The firm has been set up by a group of young, enthusiastic, highly skilled and motivated professionals who have taken experience from top consulting firms and are extensively experienced in their chosen fields has providing a wide array of Accounting, Auditing, Taxation, Assurance and Business advisory services to various clients and their stakeholders. Rajput jain & Associates, a professional firm, offers its clients a full range of services, To serve better and to bring bucket of services under one roof, the firm has merged with it various Chartered Accountancy firms pioneer in diversified fields. We have associates all over India in big cities. All our offices are well equipped with latest technological support with updated reference materials. We have a large team of professionals other than our Core Team members to meet the requirements of our prospective clients including the existing ones. However, considering our commitment towards high quality services to our clients, our team keeps on growing with more and more associates having strong professional background with good exposure in the related areas of responsibility.

Recent Posts

Exploring Corporate Bonds in India – A Comprehensive Guide

Exploring Corporate Bonds in India - A Comprehensive Guide Corporate bonds in India represent a compelling investment option, offering a… Read More

21 hours ago

CBDT Mandates E-Filing of Appendix-II Forms

Central Board of Direct Taxes Mandates E-Filing of Appendix-II Forms under Income Tax Rules, 1962 The Central Board of Direct… Read More

1 day ago

Payment System or mechanism under GST Regime

Payment System or mechanism under GST Regime General Rules for Payments   Regular taxpayers under GST must compute tax monthly,… Read More

4 days ago

Why was Rule 86B introduced under GST regime?

Rule 86B under the GST Regime Rule 86B is a provision introduced under the Goods and Services Tax (GST) regime… Read More

4 days ago

GSTN on increasing document size limits for Few attachments

Big Relief to Taxpayers- welcome change for GST taxpayers The recent update by the Goods and Services Tax Network (GSTN)… Read More

4 days ago

CBIC : New Circulars Issued on 26th June 2024

Central Board of Indirect Taxes & Customs Circulars Issued on 26th June 2024 Following the recommendations from the 53rd GST… Read More

5 days ago
Call Us Enquire Now