MSME

 

✅ Purpose of This Form:

This form is part of MSME disclosure compliance under the Companies Act and MSMED Act. Companies must report:

• Payments made to MSE (Micro & Small Enterprise) suppliers.

• Timeliness of such payments.

• Outstanding dues (if any).

• Reason for delay, if applicable.

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🔍 Column-Wise Explanation:

Col	Description
(a)	Serial Number
(b)	Name of MSE Supplier
(c)	PAN of the Supplier
(d)	Payments made within 45 days, via: - TReDS (Trade Receivables Discounting System) - Other mode
(e)	Payments made after 45 days
(f)	Outstanding dues (yet unpaid) — pending for ≤ 45 days
(g)	Outstanding dues — pending for > 45 days
(h)	Reason for any delay or outstanding balance

🧾 Illustrative Example:

Let’s say your company made purchases from 3 MSE suppliers. Details:

Supplier	PAN	Amount	Invoice Date	Paid On	Mode
A Ltd	AAAAA1234A	₹1,00,000	01-Feb-2025	20-Feb-2025	Bank Transfer	Paid within 45 days
B Ltd	BBBBB2345B	₹50,000	01-Jan-2025	28-Feb-2025	TReDS	Paid after 45 days
C Ltd	CCCCC3456C	₹75,000	01-Mar-2025	Not Paid	—	Outstanding for > 45 days

🧮 Filled Example of the Form (Simplified):

(a)	(b)	(c)	(d) Paid within 45 days	(e) Paid after 45 days	(f) Outstanding ≤ 45 days	(g) Outstanding > 45 days	(h) Reason for Delay
			(i) TReDS	(ii) Other mode
			No.	Amt. (₹)	No.	Amt. (₹)	No.
1	A Ltd	AAAAA1234A	—	—	1	1,00,000	—
2	B Ltd	BBBBB2345B	1	—	—	—	1
3	C Ltd	CCCCC3456C	—	—	—	—	—

📌 Notes:

• “No.” columns refer to the number of invoices.

• If payment is via TReDS, record under column (d)(i).

• If payment is by bank/cheque/UPI, use column (d)(ii).

• Unpaid invoices are reported under columns (f) or (g) based on how long they’ve been due.

• Provide genuine reasons in column (h) — e.g., “invoice under dispute”, “approval pending”, etc.

✅ Common Justified Reasons for Delay in Payment to MSE Suppliers:

1. Invoice under verification

   "Payment delayed due to ongoing verification of invoice and supporting documents."

2. Goods under quality inspection

   "Payment withheld pending quality check and acceptance of delivered goods."

3. Discrepancy in invoice details

   "Delay caused due to mismatch in invoice details requiring clarification from vendor."

4. Pending approval from internal department

   "Awaiting necessary internal approvals for release of payment."

5. Short supply or partial delivery

   "Only part of the order was delivered; payment will be released after full supply."

6. Payment under process

   "Payment has been processed and will be released shortly."

7. Bank reconciliation pending

   "Payment delay due to reconciliation issues with banking records."

8. Vendor bank details not updated

   "Delay due to vendor’s bank details not being updated in ERP system."

9. Dispute in price or quantity

   "Payment on hold due to dispute raised regarding pricing or quantity received."

10. Financial year-end closing activities

"Temporary delay due to year-end audit and closure activities."

11. High volume of transactions

"Delay due to backlog and high volume of transactions during the period."

12. System/technical issue in payment module

"ERP/system issue resulted in delay in processing the payment."

13. Vendor registration or compliance incomplete

"Delay as vendor KYC/compliance documentation is pending or under review."

14. Payment terms not yet due as per contract

"Payment terms contractually allow longer credit period, hence not overdue."

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✍️ Pro Tip:

You can combine reasons if needed. For example:

“Payment delayed due to pending internal approval and quality inspection of goods.”