MSME SAMADHAAN- Ease of filing application under MSEFC

One of the major hurdles in thriving of MSME’s are inadequate financial recourses, although Ministry of MSME has put various mechanism in place to resolve the issue like:

  • Bill discounting facility through TReDS platform,
  • Instructing Ministry of Corporate Affairs to track record of delayed payment by Companies registered under Companies Act, 2013 through MSME Forms
  • Setting up of Micro and Small Enterprises Facilitation Council (MSEFC).

To support these aids one more initiative was taken by the Government by launching MSME SAMADHAAN.

What is MSME Samadhaan?

Micro and Small Enterprises Facilitation Council is entrusted with the responsibility to address complaints filed by MSE suppliers for their delayed payments. However due to operational difficulty in following procedures to file complaints, Government of India has initiated for providing platform to MSE’s to file their complaints online before the concerned MSEFC of his/her State/UT.

The Ministry of Micro, Small & Medium Enterprises (MSME) launched MSME Samadhaan on 30th October 2017.

MSME Samadhaan is a portal created by Office of DC (MSME), Ministry of Micro, Small and Medium Enterprises (MSME) where Micro and Small Enterprises (MSEs) can file their applications online regarding delayed payments.

How MSME Samadhaan works?

  • Any MSE supplier can file compliant online against the buyer of goods and services if payment is delayed for more than 45 days.
  • After filing application, the application is automatically forwarded online to concerned MSEFC.
  • Council will try to settle the matter through conciliation or arbitration and pass the order.
  • The whole process is updated online and applicant can track status of his complaint online.
  • MSEFC will resolve the issue within 90 days of time period.

Below given is the extract of process flow as given by Ministry of MSME at Samadhaan Portal.

Procedural Issues

  • Applicant must have Udyog Aadhaar Number or Udyam Registration Number.
  • Copy of work orders of Respondent and invoices generated by MSE against work orders is required.
  • Maximum three work orders and three invoices can be uploaded.
  • MSME Samadhaan is facility in addition to physical submission of documents at council, aggrieved MSE can also submit documents physically at respective MSEFC.
  • In case of absence of purchase/work order, council may allow secondary and corroborated evidence like acknowledgment on invoice, email etc.
  • After submission, the application is automatically forwarded online to concerned MSEFC. Therefore, concerned MSEFC is to be contacted after filing the application online on MSME Samadhaan Portal.

Legal Issues

  • The timeline of 90 days begins only after notice of Arbitration under Section 18(3) of MSMED Act, 2006 is issued by MSEFC and not from the date of filing complaint.
  • No legal notice is required to be filed by the complainant against the buyer before filing case with council.
  • Total due amount includes receivables from buyer in form of advance deposit, EMD, statutory deposit etc thus it can also be claimed before the council.
  • Penal interest will be calculated on a monthly compounding basis.
  • Jurisdiction of state council can be extended to a district where no council is available.
  • Council does not have power to review, revise or amend its own award. After final award it becomes “Funcous officio” means having no relation to award.
  • Government Department as a Buyer can also be proceeded against in the council.
  • If the amount is claimed in the Civil Court, then it cannot be claimed before MSEFC.
  • Council does not deal with criminal offences related to subject matter of the claim.

The above said issues are presented on basis of FAQ available on samadhaan portal which was prepared by the office of DC(MSME), Ministry of MSME after consulting the legal persons in the field and information available. Any person/Institution using this FAQ may consult/ take legal opinion as and when it is required.

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