29 October 2023
is mandatory to pay within 45 days to MSME entities. if payment made after 45 days , what will be the consequences. And whether it is mandatory to present in balance under Trade payable seperately.
30 October 2023
Yes, it's mandatory to make payment within 45 days . As per provisions of section 16 of the MSME Act, If payment is not made during the given period, the Supplier is entitled to interest at the rate which is 3 times the bank rate notified by RBI.
This interest is compounding interest, which compounds at monthly intervals.
The buyer has to disclose the delayed payable to MSMEs in the financial statements, as it is mandatory as per Section 22 of the Act.
CAclubindia
