Date: 10.04.2024

SHORT SUMMARY:

In this article author shall discuss the provisions in relation to MSME-1 and FAQ’s in relation to MSME-1 (questions received from the professionals throughout the country).

Basics about MSME-1

v  Due Date of MSME-1 for the Half Year ended 31.03.2024 is 30^th April 2024.

v  It is required to all the Companies registered under Companies Act, 2013. MSME-1 is not applicable to LLP’s.

Question on Circular No-1

Que 1: What are the eligibility criteria for filing of MSME-1? (DG)

Ans 1: To check whether MSME-1 is applicable on your Company or Not. You must use the below mentioned check points: (DG)

·       Whether Company having any MSME-1 vendor? If Yes

·       Whether such MSME vendors is registered as Small or Micro? If yes

·       Whether Company made delay in payment more than 45 Days? Yes

If all check will be yes. Then only you have to file MSME-1 in your Company. Otherwise it is not required.

Que 2: If the company has made payment to the MSME vendor beyond 45 days, will it be taken in the form. The payment has been made and is not outstanding as on 31 March 2024.? (DG)

Or

If a company had bills which were outstanding for more than 45 days but paid before the reporting period ends than do we need to report that in MCA?.

Ans 2: It doesn’t matter whether payment has been made or not. Even the payment made to MSME vendor. But if the payment was delayed more than 45 days then such transaction need to me mention in MSME-1. (DG)

Que 3: If payment to MSME is Pending from 1 quarter then we have shown these details in second quarter? (DG)

Ans 3: It doesn’t matter payment is related to which quarter or year. If payment is pending to MSME vendor more than 45 days or was pending more than 45 days and paid in your half year period, then it is required to mention in MSME-1 of that half year. (DG)

Que 4: How to find a creditor registered in MSME or not? (DG)

Ans 4: There is no option on govt website or any other website to check whether a vendor is registered under MSME or not. The only way to check the same is you can ask the client through call/ mail or any other mode. (DG)

Que 5: If a company purchases a computer as a fixed asset from a MSME enterprise and made delayed in payment more than 45 days. Whether Company mention this transaction in MSME-1? (DG)

Or

The goods purchase for the office use in the name of company. Will Company file the form for these type of transaction?

Ans 5: It’s doesn’t matter for which purpose you have purchased goods or used services.

If your vendor is registered under MSME and you default in payment or delayed in payment more than 45 days. Then you have to mention the same in MSME-14. (DG)

Que 6: What are the consequences if Company file MSME-1 after Due Date i.e. 30^th April, 2024? (DG)

Ans 6: Consequences for filing of MSME-1 after Due Date. (DG)

·       There is no additional fees on MSME-1.

·       ROC can impose penalty for filing of form after due date by issue of show cause notice.

Que 7: If in any particular half year, there is no outstanding dues to MSME vendors, Whether Company have to file form MSME-1 or not? or Whether MSME-1 required to file in case of NIL? (DG)

Ans 7: There is no need to file MSME-1 in case of NIL Transaction or no Transaction.

Que 8: Whether MSME-1 is Web Based form or e-form. Further, it is required to file on MCA V2 or MCA V3? (DG)

Ans 8: MSME 1 is eform. It is required to file on MCA V2 Portal as per old method.

Que 9: If there are 900 MSME invoice are pending for payment (which has crossed 45 days) then how to make entry of the same in MSME-1? (DG)

Ans 9: A Company can mention only 90 entries in one MSME-1 form. In case Company have to mention more than 90 entries then company have to file more than 1 MSME-1. As per question if there are 900 entries then company are required to file 10 MSME-1 forms with ROC.

Que 10: If there is more than 1 invoice pending for any MSME vendor then all the bills shall be mentioned as single entry, or each invoice required to be recorded separately? (DG)

Or

What if Company have 2 or 3 invoices of different dates of same supplier. Shall Company show it separately or can club it. As entries will increase and difficult to maintain record

Ans 10: As per the MSME-1 form company must make entry as invoice wise. Entry can’t be made as per entity wise. Therefore, each and every invoice has to be mentioned separately.

Que 11: In case company has made part payment of any invoice. Whether company needs to file msme-1 form for pending amount? (DG)

Ans 11: Company has to file MSME-1 for each and every pending payment to MSME vendor. Therefore, the Company should mention the entry of pending part of payment in MSME-1.

Que 12: If the agreement between the parties is to make payment within 90 days. Whether in that case do Company need to mention details of such invoice in MSME-1? (DG)

Ans 12: As per MSME Act every agreement mentioned about payment term more than 45 days with MSME vendor shall be considered as void on completion of 45 days. Therefore, if agreement having payment term after 45 days then such transactions are required to mention in MSME-1.

Que 13: whether an amount due from April 2022 needs to be reported in the MSME-1 form for the period ending March 2024.? (DG)

Ans 13: As per MSME-1 if any payment to MSME vendor is pending for a period more than 45 days then such payment is required to be mentioned in MSME-1. In such a case it doesn’t matter payment relates to which period.

Que 14: Which date to mention in form MSME 1. Date of invoice 2 date of invoice. +45 days? (DG)

Ans 14:  The MSME-1 asks the ‘Date from which amount is Due’. Here Company should mention the Invoice Date + 45 days.

Que 15: Financial year from and financial year should be 1st April to 31st March or the half year under consideration? (DG)

Ans 15:  Financial Year from should be 01^st April and Financial year should be 31 March.

Que 16: In case in previous half year reporting few transactions are missed to mention for few vendors but later it is paid in current period and its not due as on March 31, 2024 do Company needs to provide details of such transaction in  MSME current reporting? (DG)

Or

Do Company only have to mentions those defaults which happened in the existing half year or should also mentions defaults of last half years and still continuing.

Or

Reporting has already been done in Form MSME for earlier period and the amount against invoices are still outstanding. Do Company have to report the outstanding invoice again?

Ans 16:  As the payment made delayed to MSME vendor in current reporting period. Therefore, such transactions should be mentioned in the MSME-1 of period in which payments made by the Company or payment outstanding (whether related to last period).

Author – CS Divesh Goyal, GOYAL DIVESH & ASSOCIATES Company Secretary in Practice from Delhi and can be contacted at csdiveshgoyal@gmail.com). 

Disclaimer: The entire contents of this document have been prepared based on relevant provisions and as per the information existing at the time of the preparation. Although care has been taken to ensure the accuracy, completeness, and reliability of the information provided, I assume no responsibility, therefore. Users of this information are expected to refer to the relevant existing provisions of applicable Laws. The user of

the information agrees that the information is not professional advice and is subject to change without notice. I assume no responsibility for the consequences of the use of such information. 

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