Vidhi Codex

THE MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006

The Micro, Small and Medium Enterprises Development Act, 2006

Corporate200632 sections6 chapters

This Act promotes and develops micro, small and medium enterprises (MSMEs). It classifies enterprises by their investment and turnover, and lets them file a memorandum to register as an MSME. A National Board advises the Government on MSME policy, and the Government can make schemes for credit, skills, technology and procurement preference. Buyers must pay MSME suppliers within an agreed period of at most 45 days, or pay compound interest at three times the Reserve Bank's bank rate. Payment disputes go to a Micro and Small Enterprises Facilitation Council.

Start reading →Read full ActSections

Chapter I PRELIMINARY →

  1. 1Short title and commencement
  2. 2Definitions

Chapter II NATIONALBOARD FOR MICRO, SMALL AND MEDIUM ENTERPRISES →

  1. 3Establishment of Board
  2. 4Removal of member from Board
  3. 5Functions of Board
  4. 6Powers and functions of Member-Secretary of Board

Chapter III Chapter III →

  1. 7Classification of enterprises
  2. 8Memorandum of micro, small and medium enterprises

Chapter IV Chapter IV →

  1. 9Measures for promotion and development
  2. 10Credit facilities
  3. 11Procurement preference policy
  4. 12Funds
  5. 13Grants by Central Government
  6. 14Administration and utilisation of Fund or Funds

Chapter V DELAYED PAYMENTS TO MICRO AND SMALL ENTERPRISES →

  1. 15Liability of buyer to make payment
  2. 16Provided that in no case the period agreed upon between the supplier and the buyer in writing shall exceed forty-five days from the day of acceptance or the day of deemed acceptance.
  3. 17Recovery of amount due
  4. 18Reference to Micro and Small Enterprises Facilitation Council
  5. 19Application for setting aside decree, award or order
  6. 20Establishment of Micro and Small Enterprises Facilitation Council
  7. 21Composition of Micro and Small Enterprises Facilitation Council
  8. 22Requirement to specify unpaid amount with interest in the annual statement of accounts
  9. 23Interest not to be allowed as deduction from income
  10. 24Overriding effect
  11. 25Scheme for closure of business of micro, small and medium enterprises

Chapter VI MISCELLANEOUS →

  1. 26Appointment of officers and other employees
  2. 27Penalty for contravention of section 8 or section 22 or section 26
  3. 28Jurisdiction of courts
  4. 29Power to make rules
  5. 30Power to make rules by State Government
  6. 31Power to remove difficulties
  7. 32Repeal of Act 32 of 1993

PDF: pending for this language.