Connect with us 
What is MSME Form 1?
MSME Form 1 stands for Micro Small and Medium Enterprise Form. It is an official form that certain companies in India need to file with MCA to report their outstanding payments made to suppliers that are registered under the MSME Act.
This requirement comes under the provisions of the Micro, Small, and Medium Enterprises Development Act, 2006.
In simple terms, companies in India are filing this form to disclose their delayed payments to MSMEs when the payment is pending for more than 45 days from the date of acceptance of goods or services.
General Purpose of this Form: The purpose of this form is to protect MSMEs from delayed payments by large companies.
Example: Imagine a large automobile company purchasing steel components from a small MSME manufacturer.
- Invoice date: 1 July
- Payment agreed: 45 days
- Payment made: 30 October
Since the payment was delayed beyond the 45-day limit, the company must report this outstanding or delayed payment in MSME Form-1 for that half-year. And if this company fails to do so, then they may face heavy penalties too.
Overview of MSME Filing in India
If you are a business that works with MSMEs in India? Than you can’t afford to ignore.
Many companies regularly purchase goods or services from Micro, Small, and Medium Enterprises (MSMEs)—small businesses that play a vital role in India’s economy by generating employment and supporting industrial growth. To protect these businesses and ensure they get paid on time, the Government of India introduced MSME Form-1.
This form helps the government track companies that delay payments to MSME suppliers beyond the legally allowed period.
In this article, we will explain what MSME Form-1 is, who needs to file it, when it must be filed, and how businesses can stay compliant.
Who needs to file MSME Form 1?
Applicability: MSME Form 1 applies to all companies specified and registered under the Companies Act, 2013. Meeting the condition for the specified transaction:
Transactions: Companies only need to file MSME Form 1 if their payments are delayed beyond 45 days to MSME suppliers.
This filing also applies if a foreign company (or its Indian subsidiary) is operating in India
Under the provisions of Section 405 of the Companies Act, 2013.
Exclusions: Companies with no MSME transactions, all payments cleared within 45 days, or dealings only with medium enterprises are exempt—no nil return needed.
What Information is Required in MSME Form-1?
When filing MSME Form-1, companies must provide details that are necessary for filing. Here is the quick checklist for that:
Company Details:
- Pre-filled on MCA portal: CIN, PAN, company name, registered address, and email ID
- Other Mandatory information: DSC, DIN, PAN
Supplier Information
- For each MSME with dues >45 days:
- MSME name, PAN, and Udyam Registration Number.
- Invoice details (number, date).
- Outstanding amount (principal + interest, if applicable).
- Due date (45 days post-acceptance).
- Duration of delay
Additional Declarations
- Reasons for delay (e.g., disputes, cash flow).
- Total outstanding dues summary.
- Compliance declaration confirming accuracy.
Essential MSME Udyam details: For MSME Form 1, gather these key Udyam registration details from your MSE suppliers to verify their micro/small enterprise status and complete accurate reporting.
- Udyam Registration Number (URN)
- MSME Name and PAN
- Business Address and Contact Details (optional but recommended for records)
These details help regulators monitor delayed payments made to MSMEs.
Due Date of Filing MSME Form 1
MSME Form 1 is filled on a semi-annual basis, and its due dates are as follows:
- For the period of April – September: Due by 31 October.
- For the period of October – March: Due by 30 April.
How to File MSME Form 1 in India?
MSME Form 1 is filed online via the MCA V3 portal as a half-year return form. Here is the step-by-step process to file this form:
Step 1: Visit www.mca.gov.in, log in with credentials (user ID, password)
Step 2: Go to MCA Services > e-Forms > Select” MSME Form”
Step 3: Input half-year period (Apr-Sep/Oct-Mar), MSME supplier data
Step 4: Verify info, add declaration, digitally sign (DSC) by director/CS/CEO/CFO
Step 5: Upload and download SRN acknowledgment. Track status via” View Public Documents
Since it must be in accordance with the guidelines of the MCA and the provisions of the Companies Act, 2013, if you still find any confusion and want to know whether this really applies to your company, you should contact the concerned professional to reduce the risk of penalties or incorrect filing.
To learn more, click here!
Penalties of Non-Filing of MSME Form 1 in India
If a company registered under the Companies Act fails to file MSME Form-1 in India, it may be subject to penalties under Section 405(4) of the Companies Act, 2013.
Penalty Structure
- ₹20,000 penalty for the company and the responsible/defaulting officers
- ₹1,000 per day for continued failure
- Maximum penalty up to ₹3,00,000
This penalty applies to:
- The company
- Officers responsible for compliance
Failure can also lead to prosecutions for directors, including imprisonment for up to six months
Common Myths about MSME Form 1
Many companies in India believe that MSME Form-1 is not a very important compliance or that it is optional. Because of this misunderstanding, businesses often ignore it or delay filing the form.
However, this is not correct. MSME Form-1 is an important compliance requirement issued by the Ministry of Corporate Affairs under the Companies Act, 2013. Let’s
To understand some common myths and actual facts.
Myth 1: Only Large Companies Need to File MSME Form-1
Fact:
This is one of the most common misunderstandings. MSME Form-1 is not limited to large corporations.
Any company registered under the Companies Act—such as a Private Limited Company or Public Limited Company—must file MSME Form-1 if it has outstanding payments to MSME suppliers for more than 45 days.
For example, even a small private limited company purchasing goods from an MSME vendor must report delayed payments if the dues cross the 45-day limit.
Myth 2: If There Are No Dues, Filing Is Not Required
Fact: Many companies believe that if they do not have outstanding MSME payments, they do not need to worry about the form.
While MSME Form-1 mainly reports delayed payments to MSMEs, companies should still carefully review their transactions each half-year to determine whether any payments crossed the 45-day limit.
In some cases, compliance checks or system updates under the MCA portal may require confirmation or reporting of such details.
Myth 3: LLPs and Partnership Firms Must File MSME Form-1
Fact:
MSME Form-1 is only applicable to companies registered under the Companies Act.
This means:
Required to file
- Private Limited Companies
- Public Limited Companies
- Other companies registered under the Companies Act
Not required to file
- LLPs
- Partnership firms
- Sole proprietorships
These entities may have other compliance requirements, but MSME Form-1 specifically applies only to companies.
How Mercurius Can Help with MSME Form 1
At Mercurius, we make MSME Form-1 compliance simple and stress-free for companies in India. From identifying applicability to accurate filing, our experts handle everything so you don’t have to worry about errors or penalties.
We support you with:
- Accurate and timely MSME Form-1 filings
- Complete ROC compliance management
- Review of MSME vendor data and outstanding payments
- Ongoing compliance support to avoid penalties
Whether you are a growing startup or an established company, we ensure your filings are done correctly, on time, and in line with regulations.
Have questions or need help?
Get in touch with our experts today:
📧 info@masllp.com
📞 +91 966 777 9615
