MSEs seek council help to get over `18,700-cr dues

Micro and small enterprises (MSEs) have filed over 66,500 applications seeking payment of Rs 18,700 crore pending dues from central PSUs, ministries and other entities. The Micro and Small Enterprise Facilitation Council (MSEFC) has disposed of cases involving 4.6 per cent of the payment dues. Only a miniscule of the MSME payment dues is reaching the council for settlement.

MSEFC, which facilitates settlement of pending dues of MSEs, has received a total of 66,503 applications seeking payment of Rs 18,728 crore, or over $2.5 billion, from buyers, as per data from MSME Samadhaan. The buyers are central PSUs, ministries, departments, state PSUs and government departments, railways, proprietor owned entities, individuals and other MSMEs.

The council has disposed of 5,889 applications, accounting for Rs 871 crore, or 4.6 per cent, of the Rs 18,728-crore dues. Further, the council has rejected 11,616 applications, which amounted to payment of Rs 2,541 crore. As many as 5,930 cases involving Rs 895 crore were mutually settled with the buyers.

The council is currently considering 16,088 cases, involving total payments of Rs 6,804 crore. The MSEFC is yet to review 26,980 applications, seeking Rs 6,978 crore of payment dues.

According to Rajive Chawla, chairman of IamSMEofIndia, less than one per cent of the payment dues are reaching the council for settlement. "Many of the MSMEs do not want to drag their buyer to the council as it risks losing the buyer, especially if private companies are involved. In the case of government departments and PSUs that risk is not there. Further, they wait for the situation to improve and the buyer to settle the payments. Moreover, the awareness about the council is also limited among the MSMEs," he said.

However, of late, MSMEs are increasingly approaching the council after the government increased the threshold of payment dues to approach NCLT to Rs 1 crore. Further, government also has suspended fresh cases under the Insolvency and Bankruptcy Code. "The MSMEs earlier had the option of approaching NCLT. But since the government has put fresh cases on hold and increased the threshold of dues, they are approaching the council more," said Chawla.