The criterion for furnishing the MSME I form (MCA) through those particular forms whose outstanding payment to MSMEs supplier is more than 45 days is given below:
Order named: Specified Companies (Detailed information regarding payment to micro and small enterprise suppliers) Order, 2019
Date of Notification: In context to Order on January 22, 2019, issued beneath Section 405 of the Companies Act, 2013
Effective Date: From the Date of Publication in the Official Gazette
What is MSME Form 1 (MCA)?
Towards the outstanding payments for micro and small companies, the MSME Form-1 is needed to get furnished for the payment of a half-yearly return through the registrar of companies (ROC).
The ministry of corporate affairs implemented a bigger revision for saving the interest of small firms and trades. He put significance upon mentioned compliance through all particular firms whether public or private firms, micro or small.
The firms who receive the supply of goods or services through micro or small companies and the due amount of payment posing out the cause of this delay more than 45 days from the acceptance date of deemed acceptance of the goods or services are needed to furnish the half-yearly return.
The return shall be filed in the prescribed MCA e-form “MSME FORM 1”
The Return should be stated the following points it:
- amount of payment due; and
- reasons for the delayed payment
The central government has made it compliance for all the “specified companies” to file the above-mentioned details towards payment to micro and small company suppliers practising the power beneath the provision of section 405 of the Companies Act, 2013, (18 of 2013).
Some useful terms and their interpretation
Specified companies: under the provision of section 9 of the MSME development act 2006, the specified companies are said to be those who obtained the supply of goods and services through MSMEs along with the payment with respect to these supplies to the suppliers of these MSMEs more than 45 days from the acceptance date of deemed acceptance of goods or services.
Micro and small companies: any type or types of companies which includes including proprietorship, Hindu undivided family (HUF), partnership firm, company, undertaking, co-operative society or an association of persons), which states as MSMEs beneath the micro, small and medium enterprise development (MSME) act 2006.
Note: the specified criteria mentioned above are on the grounds of the micro, small,l and medium enterprises development act 2006, and the bill to amend the criteria of types and to withdraw the MSMED (Amendment) 2015 is due in Lok sabha.
Applicability upon the firms
According to the proposed notification through MCA it is important to file disclosure via e-form MSME-I for every class of the company whether private or public, micro or small the companies who follows the below-mentioned conditions:
1st: the company should have received goods and services from micro or small companies
2nd: the payment is left or not furnished to these micro and small companies for 46 days from the acceptance date.
Note: deemed delivery date states when the buyer accepts goods and services in writing with no hesitation within the service or products obtained in 15 days of a time period.
The way of furnishing MSME Form 1 (MCA)
The initial one-time return: the firm must furnish MSME Form I detailing all the outstanding dues with respect to the micro or small companies suppliers which exist upon the notification date of the concerned order in 30 days from the deployment date of E-form MSME-1 on the MCA portal.
The last date for furnishing the initial return (first-time return) on Form MSME-1: In 30 days from the date when e-form MSME-1 will be stationed upon the MCA portal.
Note: according to the extended notification of MCA on 21/02/2019.
MSME Form 1 (MCA) Due Date
Every firm is needed to furnish the MSME-1 prior to 21/02/2018 stating the information of all the outstanding payments to micro or small enterprises (MSMEs) suppliers laid on the notification date of the order in 30 days.
MSME Form 1 Due Date (Initial Return)
For all the eligible companies the government would have notified the MSME form 1 of the due date of 30th May 2020 for all the eligible companies. The council quoted that the last date for the companies for filing the form would be 30 days from when the same would get uploaded to the official website. Read below for the notification here.
MSME Form 1 Due Date (Half-Yearly Return)
In the duration of 45 days from the finish of each half-year, the Form MSME I (half-yearly return) is mandated to get filed for outstanding payments to Micro or Small Enterprise i.e. 30th April 2023 for October 2022 to March 2023 and 31st October 2023 for April 2023 to September 2023.
Particular firms: according to section 9 of the MSME development act 2006 the particular firms are the ones who obtain the supply of goods or services from MSMEs and the payment with respect to these supplies towards the supplier of the MSMEs more than 45 days from the acceptance date both for goods and services.
Micro and Small Enterprise: Micro and small companies show that the types of companies consisting of proprietorship, Hindu undivided family, partnership firm, company, undertaking, the association of the individual or the co-operative societies where the applied conditions are like mentioned in the below table:
|Manufacturing Sector||Conditions applied|
|Enterprises||Investment in plant & machinery|
|Micro Enterprises||Does not exceed twenty-five lakh rupees|
|Small Enterprises||More than twenty-five lakh rupees but does not exceed five crore rupees|
|Service Sector||Conditions applied|
|Enterprises||Investment in equipment|
|Micro Enterprises||Does not exceed ten lakh rupees:|
|Small Enterprises||More than ten lakh rupees but does not exceed two crore rupees|
Note: The things which are shown above are provided upon the ground of micro, small and medium enterprises development act 2006 along with the bill to amend the classification criteria and to withdraw the MSMED (Amendment), 2015 is pending in the Lok Sabha.
The MSME Act, 2006 defines the Micro Small and Medium Enterprises.
Exemption to this Rule:
- The Rules’ applicability is not for all the Companies but just for those Specified Companies whose payment to MSMEs suppliers exceed 45 days from the date of acceptance or deemed acceptance of the goods or services as per the provisions under section 9 of the MSME Development Act, 2006.
- An exemption is also applied in cases where payment against supplier exceeds 45 days but the supplier/Creditors gives a declaration that they do not lie in the category of Micro or small Enterprises.
Privilege to the rule who must not furnish the form?
Beneath the provisions under section 9 of the MSME Development Act, 2006 the rule is not subjected to all the firms but only those specified firms whose filing is left for MSMEs suppliers is more than 45 days from the acceptance date or deemed acceptance of goods and services.
If the payment with respect to the supplier is more than 45 days however the declaration has been furnished by the supplier that they do not come below the class of micro or small enterprises.
Due Date of Form INC-22A (Active) by MCA with Penalty
As per the Government Rules, filing of Form INC-22A (Active) has been mandated and is required to be filed on or before 25th April 2019. The forms would also be accepted with a late fine of INR 10,000 if filed after 25th April 2019.
NOTE: The government has extended the due date till 15th June 2019.
In a case where a company does not file the INC-22A (ACTIVE) form, the government would not be accepting certain forms from them including:
- SH-07 (Change in Authorized Capital)
- PAS-03 (Change in Paid-up Capital)
- DIR-12 (Changes in Director except for cessation)
- INC-22 (Change in Registered Office)
- INC-28 (Amalgamation, de-merger)