MSME Samadhan Portal

MSME Samadhan Portal

Executive Summary:

• • • This article will help to understand the motive behind the establishment of the MSME Samadhaan Portal.
    • This article will also explain who can and how to use the MSME Samadhaan Portal.

Introduction:

On October 30, 2017, the Ministry of Micro, Small, and Medium Enterprises (MSME) inaugurated MSME Samadhaan Portal. MSME Samadhan, also known as the MSME Delayed Payment Platform, was created to help micro and small enterprises all over the world. It allows people to express their dissatisfaction with Central Ministries/Departments/CPSEs/State Governments for failing to pay them on time. The software would make keeping track of late payments in a timely manner much easier. The information on this page will be made public in order to apply moral pressure on those who have broken the law. MSMEs can utilize the site to track their cases as well.

Payment delays have been and continue to be the most significant issue confronting business owners, and unfortunately, only a small percentage of companies pay their suppliers on time. This MSME delayed payment creates a serious financial problem because the money is withheld as a result, and MSME businesses are unable to spend money on business growth and are stuck due to limited finances. Once this money has been converted into a monetary claim, these businesses will have no choice but to approach the appropriate Court or Forum, as well as attorneys, in order to recover money from the said businesses. In India, the litigation process for recovering money is fairly extensive and time-consuming; making refunds a major issue for those who are going through it. This legal action is also highly costly.

What is MSME Samadhan Portal?

On the 30th of October, 2017, the Ministry of MSME created an online platform that allows MSE suppliers to make an online complaint against a buyer of products or services before going to his or her state’s or UT’s Micro and Small Enterprise facilitation Council(MSEFC).The MSEFC Council will review these concerns and take appropriate action. Such concerns will also be visible to relevant national ministries, departments, state governments, and other entities for effective action. MSME Samadhaan is a portal developed by the Office of the DC (MSME), Ministry of Micro, Small, and Medium Enterprises, where Micro and Small Enterprises (MSEs) can file applications for delayed payments online.

Overdue payments to Micro and Small Businesses are addressed in the MSMED Act of 2006, also known as the Micro, Small, and Medium Enterprise Development Act (MSEs). If a customer fails to pay the supplies within 45 days of receiving the goods/service, he will be subject to a compounded fine. The fine is calculated as three times the Reserve Bank’s announced bank rate multiplied by the sum each month. Sections 20 and 21 of the Act require state governments to establish a Micro and Small Enterprise Facilitation Council (MSEFC) to resolve disputes relating to the filing of Delayed Payments.

According to Section 16 of the MSMED Act, in the event of non-payment or deferred payment, the consumer is obligated to pay interest with the monthly rests to the supplier. The interest is calculated by multiplying the interest rate by three times the RBI-mandated bank rate. Any referral to MSEFC must be resolved within ninety days of its issuance. If the claimant is not a supplier but wishes to file an appeal, he must set aside 75% of the award amount before the court can begin hearing the case.

Who can apply to the Portal?

Any micro or small company having a valid Udyog Aadhar (UAM) can register an online complaint against the buyer/purchaser of goods/services with the relevant MSEFC in his or her state/UT. These applications will be reviewed by the MSEFC Council. All interested federal ministries, departments, CPSEs, and state governments would have access to these applications.

Features of the Samadhaan Portal:

• Can file Application Online-
  Entrepreneurs and MSEs can now make claims for delayed payments online using the MSME Samadhan portal. In order to do so, a consumer must have an Udyog Aadhaar Number that has been verified using Aadhaar. Entrepreneurs/MSEs can use the portal to check the status of previously filed online applications for delayed payments.
• Dashboard for pending Payments-
  The Portal will contain data on pending payments between MSEs and specific CPSEs/Central Ministries, State Governments, and other entities. PSE CEOs and Secretaries of the involved Ministries will be able to track payment delays and issue the required directives to correct them.
• Each reference or a case made to MSEFC must be decided within 90 days from the date of making such a reference as per the provisions laid in the act.
• If the Appellant (who is not the supplier) wishes to file an appeal, no court will accept an application to set aside any MSEFC decree or award until the appellant (who is not the supplier) has paid the MSEFC 75 percent of the award amount.
• Each state government needs to provide notification regarding: Authority for filing Entrepreneur Memorandum, rules of MSEFC, Constitution of MSEFC

Procedure followed for the use of portal:

The following is the method for filing a case on the MSME Samadhaan portal – a delayed payment monitoring system:

• a) Access the MSME Samadhaan portal at samadhaan.msme.gov.in/.
• b) Fill up your Udyog Aadhaar number and mobile number exactly as they appear on your Udyog Aadhaar. Fill in the verification code and click the ‘confirm udyog Aadhaar’ button. An OTP will be sent to your email address. Start by filling out the OTP and submitting the case.
• c) If you haven’t already done so, go to udyogaadhaar.gov.in to get your Udyog Aadhaar number and then start filing your case on the MSME Samadhaan Portal.
• d) To upload to the portal, you should have a maximum of three work orders and three invoices in PDF format. The file size should not be more than 1MB.
• e) Enter your udyog Aadhaar number or application number to check the status of your case.

Conclusion:

Over the last several years, the Micro, Small, and Medium Enterprises (MSME) sector has emerged as the most active segment of the Indian economy. It makes a substantial contribution to the country’s economic and social development by supporting economic growth, equal development, and entrepreneurship, as well as offering large-scale job possibilities at relatively low costs, such as in agriculture. Because this sector is involved in a variety of sectors, it plays a significant role in creating employment among a diverse group of people, and as a result, this industry serves as a backbone for our country. The scope of MSME has been enlarged as a result of the newest revisions to the MSMED Act and the Insolvency and Bankruptcy Code (IBC) issued by the Government of India since the onset of the COVID-19 pandemic, therefore contributing to the safeguarding of our country’s stable economy.

Regards,
Legal Team

Proind Business Solutions Private Limited
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