Learn how Advocate BK Singh assists MSMEs with unpaid invoices, MSEFC claims, delayed payment interest, dispute resolution and business recovery cases.
It's never easy for a small business when they are unable to receive their payments. There are salaries to pay off. GST to pay off. Payments to suppliers etc. Your buyer will most likely tell you they will pay you by another day and nothing will happen.
If your business falls under Micro or Small Enterprise then this could mean life and death for your business.
MSME Payment Recovery Lawyer will help the eligible enterprise understand their unpaid invoices, contract, PO's and delivery challans etc. To determine which forum of recovery would apply to them. And assist them in recovering payments via Notice, Discussions, MSEFC Proceedings, Arbitration or Commercial Litigation.
At BK Singh Advocate we represent businesses that have faced delays in receiving payments. Whether it be Invoices, Supply of Goods/Services that have been Disputed. PO that have not been honoured. Services rendered and not honoured. Or even amount withheld as Retention. One thing that many don't understand is. You don't just want to know if you can take your buyer to court. But rather what are your options of recovering payment. And is there any substance to those options based on documents.
Your buyer might say that they received goods but they aren't satisfied with the quality. Your buyer might say yes we received the invoice but your invoice had to be cleared with our 3rd party. Your business is registered as MSME. Or maybe you were supplying goods before you became registered. All of these factors can come into play.
So when speaking to MSME Lawyers about your case. We will want to see all documents pertaining to the sale. Before proceeding with any form of litigation.
Whether your business operates in Delhi NCR, Noida, Ghaziabad, Greater Noida. Gurugram, Faridabad, Meerut, Lucknow, Jaipur, Mumbai, Bengaluru, Hyderabad, Chennai or Kolkata. When you have payments due from a buyer it can affect more than just that one payment.
If you have ?5 lakhs or ?20 lakhs tied up in pending invoices as a small manufacturing/trading/service business. This can amount to your cash flow for many months. People continue chasing each other on informal basis since they don't want to burn the commercial tie.
There's a catch though.
Things get lost over time. Personnel who were involved in the transaction move out. You lose emails. Buyer starts contesting things that weren't contested at the time of delivery.
BK Singh can take a look at what happened commercially between you and your customer. There is no compulsion that as soon as you approach us we will file a case against them. We may suggest a demand letter, amicable resolution or reconciling the dues which could be a better option commercially.
Under MSMED act there is also an option available for Micro and Small Enterprises if your invoice is pending. Section 15 says that payment should be made within a period of 45 days from date of receipt or deemed receipt of goods/services. Interest can be claimed under section 16 and recovery of dues under section 17.
Sometimes it is important where your supplier is located. If you're a Delhi based supplier supplying to Mumbai then it's one thing but if your a Noida based company supplying locally it's another. These aspects need to be looked into rather than assuming something.
What is the key thing here is that money has become due on account of goods supplied and / or services rendered. And what course of action we can take to collect the said dues.
Merely looking at the Invoice will not solve the issue.
It is necessary that the advocate checks whether the goods were supplied or services rendered. Invoices accepted or disputed, Credit Notes issued and any part payments made. Purchase orders and payment terms on contract also become important.
If we are to raise a Statutory Claim against MSME the other aspect is that was the entity an MSME i.e. Supplier for the purpose of the transaction that you wish to invoke the MSMED Act provisions on.
BK Singh Advocate would look into when was the MSME/Udyam registration done and compare that with the purchase order date, supply, invoice and date of default. You cannot assume that if you got registered later it will benefit you for previous supplies.
This may change your course of action.
You may still be able to file a Commercial suit, Arbitration or pursue the contractual remedy for collection of dues.
No. Calling it an MSME won't answer the question at hand.
Mostly the issue that comes up when we deal with chapter v is the MSME's which have qualified as Micro & Small Supplier. How they are registered? When did they get registered? What kind of purchase has taken place?
If someone supplied machine in year 2024 and got registered under MSME few months later and want to avail benefit under this law. What would be the stand?
Similar scenario could be buyer might argue that the job hasn't been completed by the supplier as per agreement. Or some issue with material. This cannot be answered just by showing an unpaid invoice.
So Advocate BK Singh can look into-
These can help save your time from taking action under this law which might not be suitable for you.
Most payment dispute cases are decided on what your commercial record says.
You will require your commercial documents from which MSME Lawyers can derive their claim. Not just a list of invoices that have gone unpaid.
Below are some of the Documents and Evidence to have handy
Even if they seem small don't delete any such messages. You may have an Email from customer accepting there liability towards 8 lakhs. It will prove to be more helpful than calling them multiple times.
BK Singh Advocate will be able to map this information to your case.
Buyer's defence has to be looked into case to case basis.
There could be some cases where it is true. That the goods may have been returned at the time of delivery or some milestones might be pending as per contract.
But there are cases where it comes up when you repeatedly ask for money.
Your Advocate can look into when was the quality issue brought up as compared to the date of delivery and previous acts by the buyer. In case they have used it and paid some amount then maybe those could come into picture.
BK Singh Advocate can also check if the contract had an inspection period mentioned, how will acceptance be done, any warranty clause etc.
So this doesn't mean we ignore buyers defence but just analyse it according to documents.
Yes. Settling may help you get some liquid cash rather than going through with protracted litigation.
Suppose your vendor is having an issue with one of their clients from a very long time who owes them 18 lakh rupees. Client agrees to pay 14 Lakh and disputes the rest on account of shortage. It may be advisable to settle if there is an agreement reached which is practical and there is a proper settlement deed drafted.
However be careful with out of court settlements.
We will pay you everything by next month is not enough. Know what you are settling on. How many installments will be made, if any defaults occur, interest applicable if any, existing proceeding and settlement on full and final basis.
BK Singh Advocate can help you negotiate and also keep you covered if the other party does not abide by the settlement terms.
Do not withdraw a proceeding just because someone told you they will pay you.
Advocate BK Singh will help you analyse your documents in Delhi, New Delhi, Ghaziabad, Noida, Greater Noida, Gurugram etc and tell you if its wise to send notice / go for Conciliation / approach MSEFC / Arbitrate or litigate.
MSME Lawyers help you deal with issues around MSME payments and Commercial disputes such as Non Payment of Invoices, Receivable amount, Contract disputes, Buyer disputing invoices and Recovery cases.
Sometimes we may have to start with auditing the transactions before we can initiate legal action.
BK Singh Advocate will be able to go through your Registrations, Contracts, Invoices, Proof of delivery, Correspondence and Payments made earlier (if any) to point out loopholes in the deal which can be used by the buyer.
If you can take benefit of the MSMED Act we can assist you in filling your Claim and check for loopholes. Calculate Interest, Prepare documents for filing in MSEFC and represent you at conciliation stage and beyond if the case takes further steps.
In other situations we may look into what options you have as per the contract or Arbitration Act 1996 or Commercial Courts Act 2015 depending upon the situation.
For disputes above the prescribed value in the Commercial Court you may need to look at Mediation before approaching the Court under Section 12A of Commercial Courts Act unless you wish to seek urgent relief from the Court.
BK Singh Advocate can analyse the unpaid invoice, contract, deliveries made, MSME certificate and communication to find out the best course of action to recover dues. This could range from notice, negotiations, MSEFC or even a suit depending on the scenario.
Section 15 would restrict the written contract from stipulating a period higher than 45 days from the day of receipt or deemed receipt of goods/services.
If your are eligible supplier you can claim interest u/s 16 of the Act. Which allows compound interest monthly rests at 3x of the bank rate notified by RBI subject to the provisions of the Act.
MSEFC is a reference under section 18 of the MSMED act for amounts payable under section 17. It provides for conciliation and arbitration as per the MSMED act if the dispute cant be settled.
You have to look at what is defined under the Act and how it applies to your transaction. You cannot presume all businesses that fall under the description of MSME will be covered by section 18.
If you register later than your previous transactions they may not qualify for the benefit. This needs to be reviewed based on your dates of registration and transactions. BK Singh Advocate can look into this for you based on the documents of the transaction.
It may or may not affect your recovery of dues. You would need to check your purchase order, inspection reports, delivery details, email communication, when they rejected the goods, etc.
Yes, many disputes can be settled. Whether by negotiation or through the conciliation process if both parties agree to settle. Make sure the settlement is clear on the terms of the amount paid, how and when it will be paid, if any interest will be payable and if there is a default what the consequence would be.
Yes invoices are very important. Any documents which can prove you supplied them goods or provided a service would be useful. Such as purchase order, invoice, delivery challan, gst invoices, bills of lading, email communication, ledgers and bank statements.
As soon as you feel that your dues are significantly overdue and your customer has raised any objections or if the documents don't support you. It is always good to talk to MSME Lawyers who can advise you on your next course of action.
MSME Payment recovery isn't only about sending out a stern notice. There could be many factors that may play a role. Whether the seller is registered or not, when was the invoice raised, goods delivered or not, period of payment, buyers grievance etc. All these could affect your case.
Under MSMED Act if you fall under Micro & Small category. There are certain provisions which are in your favour from section 15 to 18. You can claim interest and approach MSEFC if the invoice has not been paid within 45 days.
However you need to assess each case on merit.
BK Singh Advocate can help you analyse your case and advise what course of action you should take to get paid. Before it's too late.
If your receivables are becoming stagnant and impacting your business cash flow. Paying salaries and vendors or losing new customers. Then it's advisable to get an expert opinion.
Speak directly with Advocate BK Singh at LEGAL365.
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