ALL ABOUT MSME-1 FILING - FAQ'S - SERIES - 423
FAQ’s- Queries
MSME Filing
On the Basis of Query Received on MSME
In this Flash
Editorial author begins by referring the queries / questions received from
professionals, Students or corporate in relation to MSME Filing.
A. If a Company falls in criteria
of MSME, However not registered under MSME Act. Whether Company need to mention
details of such MSME in their reporting?
As per language of
Notification, If a Company registered under MSME Act and having a valid MSME
certificate. Then only required to includes in reporting while filing of MSME-1
Therefore, one can opine that, Details of only
registered MSME required filing with ROC in form MSME-1.
B. Whether for purpose of filing
of e-form MSME-1 by specified Companies. Whether Micro or Small Companies
required to obtain registration under MSME Act or not?-
As per language of MSME Act, 2006
Section 8 “Any person who intends to establish Micro, Small “shall” file …………………….. With authority.
Therefore, one can opine that an entity
registered under MSME Act, 2006 by fulfilling the above mentioned limit shall
considered as Micro and Small entity for purpose of MSME-1. Therefore, one can
opine that, Details of only registered MSME required filing with ROC in form
MSME-1.
C. If on 22.01.2019 (date of
notification of rules) company doesn’t have any MSME register creditor. Whether
Company need to file MSME-1 with NIL details.
As per language of
Notification, if all the vendors/ creditors of Company are NON- MSME registered. In such case there is no need to file MSME-1.
Therefore, one can opine that, If company
doesn’t not have any registered MSME Company there is no need to file MSME-1.
D. Whether there is any limit on
amount of transaction with MSME?
As per MSME Act, 2006;
Limit of amount doesn’t matter to check whether payment made in 45 days or not.
For an EG. If due amount is Rs.
100/- only and doesn’t made payment in 45 days. Specified Companies needs to
report the same to ROC in e-form MSME-1.
E. If on 22.01.2019 (date of
notification of rules) company having MSME register creditor / vendors.
However, there is no due more than 45 days. Whether Company need to file MSME-1
with details of such Company?
As per language of Notification, Company having
Creditors/ vendors which are registered in MSME. However, there is no default
in payment of such vendor for more than 45 days. In such
case there is no need to file MSME-1.
Therefore, one can opine that, requirement to
file forms arise only in situation where there is default in payment more than
45 days.
F. What are the Consequences on
Company if its fails to file e-form MSME-1 within 30 days of notification?
Statutory Provisions Contained Under the Act:
Section 405: - Power of Central Government to Direct Companies to Furnish Information or Statistic
Section 405: - Power of Central Government to Direct Companies to Furnish Information or Statistic
(1) The Central Government may, by order, require companies generally, or any class of companies, or any company, to furnish such information or statistics with regard to their or its constitution or working, and within such time, as may be specified in the order.
(4) If any company fails to comply with an order made under sub-section (1) or subsection (3), or knowingly furnishes any information or statistics which is incorrect or incomplete in any material respect, the company shall be punishable with fine which may extend to twenty-five thousand rupees and every officer of the company who is in default, shall be punishable with imprisonment for a term which may extend to six months or with fine which shall not be less than twenty-five thousand rupees but which may extend to three lakh rupees, or with both.
Therefore, one can opine that if company fails to file MSME-1 within 30 days then Penalty shall be as follow:
(4) If any company fails to comply with an order made under sub-section (1) or subsection (3), or knowingly furnishes any information or statistics which is incorrect or incomplete in any material respect, the company shall be punishable with fine which may extend to twenty-five thousand rupees and every officer of the company who is in default, shall be punishable with imprisonment for a term which may extend to six months or with fine which shall not be less than twenty-five thousand rupees but which may extend to three lakh rupees, or with both.
Therefore, one can opine that if company fails to file MSME-1 within 30 days then Penalty shall be as follow:
Penalty on
|
Minimum Fine |
Fine can Extend Upto
|
Company
|
Rs. 25,000/-
|
Rs. 25,000/-
|
Officer in Default (KMP, Directors)
|
Rs. 25,000/-
|
Rs. 300,000/-
|
G. If a MSME-1 Company ownes
money to other MSME Company and payment is due more than 45 days. Whether first
Company needs to file MSME-1?
As per language of
Notification, every company who has not makes payment of any due to MSME within
45 days. Such Company shall be fall in criteria of Specified Companies. Therefore, such Companies required filing e-form MSME-1.
H. If a Company registered under
MSME but later on exceeded the limit provided for registration under MSME. Do
specified companies need to report about such company in MSME-1?
As per language of MSME
Act. Any company wants to register under MSME Act need to comply conditions /
limits under MSME Act.
Therefore one can opine that, if any time
Company crossed such Limit will be cease to considered as MSME. However, if a
company ceased as MSME no need to get reported under MSME-1.
I. Which Companies need to do
compliance of form MSME-1?
Every Company “Public or Private” if falls in below mentioned condition:
J. Which type of entities cover
under Micro and Small entities?-
Micro and small Includes:
·
Proprietorship, Hindu Undivided Family,
·
Association of Persons, Co-Operative Society,\
·
Partnership Firm, Company
or Undertaking
K. How to identify whether
creditors entity falls under Micro and Small or not?-
For the purpose of reporting under MSME Form-1.
Company should be aware that creditor’s entity is Micro or Small or not.
Therefore,
1.
Company have to ask a
declaration from the creditors whether they falls under Micro or small or not
and whether as on date they meet criteria of MSME.
2.
Company has to ask for
copy of certificate of registration under MSME.
L. In “One Time Return” which
type of information required to submit with ROC?
M. Which Companies falls under
MSME
The limit for investment
in plant and machinery / equipment for manufacturing / service enterprises, as
notified,vide S.O.
1642(E) dtd.29-09-2006 are as under
Manufacturing Sector
|
|
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
|
Medium
Enterprises
|
More than five
crore rupees but does not exceed ten crore rupees
|
Service Sector
|
|
Enterprises
|
Investment in
equipments
|
Micro
Enterprises
|
Does not exceed
ten lakh rupees:
|
Small
Enterprises
|
More than
ten lakh rupees but does not exceed two crore rupees
|
Medium
Enterprises
|
More than two
crore rupees but does not exceed five core rupees
|
N. Meaning of Enterprises?
·
Manufacturing Enterprises-he enterprises engaged in the manufacture or
production of goods pertaining to any industry specified in the first schedule
to the industries (Development and regulation) Act, 1951) or employing plant
and machinery in the process of value addition to the final product having a
distinct name or character or use. The Manufacturing Enterprise
are defined in terms of investment in Plant & Machinery.
·
Service Enterprises:-The enterprises engaged in providing or rendering
of services and are defined in terms of investment in equipment.
O. Whether Traders and Retailers
can get registration under MSME?
As per our understanding
of MSME Act, Only manufactures and service provides as mentioned above can get
registration under MSME.
P. If there is an agreement
between MSME registered company and other company for payment with in any days
more than 45 days e.g 60 days or 75 days? Whether Specified Company need to
file e-for MSME-1 after expiry of 45 days?
As per section 15 of
MSME Act, “in no case period agreed between supplier and buyer in writing shall
exceed 45 days from day of acceptance.
Therefore one can opine that, agreement between
supplier and buyer for payment after 45 days doesn’t have any effect in filing
of MSME-1. Because as per MSME Act, supplier and buyer cannot decide day more
than 45 days.
Q. What are consequences for non
filing of the MSME form?
As per section 16 of
MSME Act, if buyer make delay in payment more than 45 days in such case buyer
is liable to pay compound interest with monthly restes to the supplier on that
amount from the appointed day, at three times of the bank rate notified by RBI.
Therefore one can opine that, consequences nonpayment
within 45 days is buyer liable to make payment of interest.
R. What are consequences for non
filing of the MSME form?
As per
section 16 of MSME Act, if buyer make delay in payment more than 45 days in
such case buyer is liable to pay compound interest with monthly restes to the supplier
on that amount from the appointed day, at three times of the bank rate notified
by RBI.
S. If supplier registered under SSI
but not registered in MSME. Whether reporting in respect of SSI registered companies
required?
Reporting in MSME-1 is
required in respect of MSME registered Companies Only. SSI registered companies
are not required to file MSME-1
T. Is there any online facility
to check whether Companies’ is registered under MSME or not?
There is no online
portal to check whether Company is registered under MSME or not. Buyer have to
ask the same from supplier.
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 on the basis of 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 a professional advice and is subject to change without
notice. I assume no responsibility for the consequences of use of such information.
IN NO EVENT SHALL I SHALL BE LIABLE FOR ANY DIRECT, INDIRECT, SPECIAL OR
INCIDENTAL DAMAGE RESULTING FROM, ARISING OUT OF OR IN CONNECTION WITH THE USE
OF THE INFORMATION
WHAT IF, FIRM IS GOING TO CONVERT IN PRIVATE LIMITED COMPANY?
ReplyDeleteWHAT WILL BE POSITION FOR CREDITORS OF FIRM, THAT WILL BECOME COMPANY'S CREDITORS AFTER CONVERSION
About point A, Where is the mentionung of Registered MSMEs in the notification
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ReplyDeleteThanks for sharing information. At presemt yime it's very help full for all CS. By reading this only so many doubt are cleared.
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ReplyDeletePlease reply to second query above
ReplyDeleteIn Regular half yearly return what if the payment exceeds 45 days between october to march but there is no outstanding payment as on 31-03-2019 (Suppose Service is received in october and payment is made in Jan), do we still need to report as the form is only asking about the outstanding amount?
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Earlier known SSI Registration is now termed and known as MSME Registration. MSME stands for Micro, Small and Medium Enterprises. Here all youd should know how MSME Registration in India can help you in your Business
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