MSME-1 Form: Basic Understanding And Determining Factors By CS Mohit Saluja

Wordings of Notification
MCA vides its notification dated 22.01.2019 issued an Order may be called the Specified Companies (Furnishing of information about payment to micro and small enterprise suppliers) Order, 2019 through which reporting was required to be made by Specified Companies before the ROC in MSME FORM 1.
What are Specified Companies
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 section 9 of the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006).
Reporting Requirement
Every specified Company shall submit a half yearly return to the Ministry of Corporate Affairs in MSME Form I stating the following:

(a) the amount of payment due; and
(b) the reasons for the delay;
From April - September = 31st October
From October - March = 30th April
Why there are hue and cry in the month of January then:

Since, the notification has been issued by the Ministry regarding submission of information regarding their dues pending for more than 45 days to MSME sectors/ Firms within 30 days of issue of such notification by the Ministry. And, since the notification has been issued on 22.01.2019, hence, all companies need to file the information within 30 days of notification i.e. till 21.02.2018. Therefore, the companies need to have a thorough check on all such payments and to determine which are the pending payment for more than 45 days.

Can the companies file MSME 1 Form now:

No., since the E Form MSME 1 is not available as on 02.02.2019. Hence, no form can be filed and accordingly the companies have only 20 days left and MCA is silent about the launch of this MSME 1 E Form. Hopefully, the date shall be extended as it already has been done in case of BEN-2, NFRA, Form 20A Commencement of Business certificate form.


How can a company determine that the firm to whom payment is due is an MSME or not

Since, the criteria of Small and Medium concern is based on turnover, hence, no corporate can determine the status of another firm is a small, medium or large concern, hence, the only way out to determine is to get a written declaration via post or via mail from the creditors about their status and should submit the declaration accordingly with Ministry.

Moreover, the following is the reference chart from where one can determine whether a firm/.

Company come under MSME sector or not:

Manufacturing Sector


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


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 crore rupees

NOTE: The above chart is based upon the notification of Government issued vide notification, vide S.O. 1642(E) dtd.29-09-2006 which has been prescribed by the Government of India by enacting the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 in terms of which the definition of micro, small and medium enterprises has been provided.

Relation of Notification issued by Ministry of MSME on 02.11.2018 with notification of MCA dated 22.01.2019?

The notifications issued by the Ministry of MSME and MCA have not any relation. As per S.O.5621 (E) The central Government has issued a notification dated 02.11.2018 whereby all the companies registered with Companies Act 1956/2013 having a turnover of more than 500 crores, have been instructed to get themselves on board of TReDS platform called as Trade Receivables Discounting System Platform, set up as per the notification of Reserve Bank of India.

Hence, the above two notifications are since co-related to each other but still are an independent one and the corporate falling under above two notifications need to comply accordingly.
Lex comply

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