The Central Government has issued a directive under Section 9 of the Micro, Small, and Medium Enterprises Development Act, 2006 (MSMED Act, 2006), making it mandatory for companies to report payment delays to micro and small enterprises (MSEs).
Key Compliance Requirement
As per the notification, any company that:
- Procures goods or services from micro and small enterprises (MSEs), and
- Fails to make payments within 45 days from the date of acceptance or deemed acceptance,
must file a half-yearly return with the Ministry of Corporate Affairs (MCA).
Details to be Reported
The half-yearly return should include:
- Outstanding payment amounts due to MSE suppliers.
- Reasons for delay in payments beyond the stipulated 45-day period.
Official copy of the notification is as follows
MINISTRY of MICRO, SMALL AND MEDIUM ENTERPRISES
NOTIFICATION
NEW DELHI, 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.
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