Document text
[SUPPLIER'S NAME — MICRO / SMALL ENTERPRISE]
[REGISTERED ADDRESS]
Udyam Registration No.: [UDYAM-XX-00-0000000] · GSTIN: [GSTIN]
[PHONE] · [E-MAIL]
Ref. No.: [REFERENCE NUMBER]
Date: [DD/MM/YYYY]
BY SPEED POST / REGISTERED POST A.D. AND E-MAIL
To,
[BUYER'S NAME]
[ATTENTION: DIRECTOR / PROPRIETOR / HEAD OF ACCOUNTS]
[BUYER'S ADDRESS]
GSTIN: [BUYER'S GSTIN]
Subject: Notice for payment of overdue amount of ₹[PRINCIPAL AMOUNT] with interest under Sections 15, 16 and 17 of the Micro, Small and Medium Enterprises Development Act, 2006
Dear Sir/Madam,
1. We are a [MICRO / SMALL] enterprise registered under Udyam Registration No. [UDYAM NUMBER] since [DD/MM/YYYY]. A copy of our Udyam Registration Certificate is enclosed.
2. At your request, we supplied [GOODS / SERVICES — SHORT DESCRIPTION] to you under [PURCHASE ORDER / WORK ORDER / AGREEMENT No. ___ dated ___]. You accepted the supplies without any objection. The details are as follows:
No. Invoice No. Invoice date Date of delivery / service Date of acceptance Agreed payment date (if any) Amount (₹) Amount received (₹) Balance due (₹)
1 [INVOICE NO.] [DD/MM/YYYY] [DD/MM/YYYY] [DD/MM/YYYY] [DD/MM/YYYY / NONE] [AMOUNT] [AMOUNT] [AMOUNT]
2 [INVOICE NO.] [DD/MM/YYYY] [DD/MM/YYYY] [DD/MM/YYYY] [DD/MM/YYYY / NONE] [AMOUNT] [AMOUNT] [AMOUNT]
Total principal due [TOTAL]
3. Under Section 15 of the Micro, Small and Medium Enterprises Development Act, 2006 (the "Act"), you were required to pay for these supplies on or before the date agreed between us, which in no case can exceed forty-five days from the day of acceptance, or, where there is no agreement, before the appointed day under the Act. The payment for each invoice above has not been made within that period and is now overdue.
4. Under Section 16 of the Act, where a buyer fails to make payment as required by Section 15, the buyer is liable to pay compound interest with monthly rests on the amount due, from the appointed day or, as the case may be, from the day following the agreed date, at three times the bank rate notified by the Reserve Bank of India. Under Section 17, you are liable to pay the amount due together with this interest. The interest is calculated as follows:
Invoice No. Balance due (₹) Interest from Interest up to Months / days overdue Rate (3 × RBI bank rate of [BANK RATE]%) Interest (₹), compounded monthly
[INVOICE NO.] [AMOUNT] [DD/MM/YYYY] [DD/MM/YYYY] [PERIOD] [RATE]% p.a. [INTEREST]
[INVOICE NO.] [AMOUNT] [DD/MM/YYYY] [DD/MM/YYYY] [PERIOD] [RATE]% p.a. [INTEREST]
Total [TOTAL PRINCIPAL] [TOTAL INTEREST]
Total amount payable as on [DD/MM/YYYY]: ₹[PRINCIPAL + INTEREST] (Rupees [AMOUNT IN WORDS] only), with further interest under Section 16 until the date of actual payment.
5. [OPTIONAL: Our reminders dated [DD/MM/YYYY] and [DD/MM/YYYY] remain unanswered. / You have not raised any objection to the quality or quantity of the supplies at any time.]
6. We therefore call upon you to pay the total amount stated above within [15] days of receipt of this notice, by transfer to our account:
Account name: [ACCOUNT NAME] · Account No.: [ACCOUNT NUMBER] · Bank and branch: [BANK, BRANCH] · IFSC: [IFSC]
7. If the amount is not paid within this period, we shall make a reference to the Micro and Small Enterprises Facilitation Council under Section 18 of the Act through the MSME Online Dispute Resolution portal (odr.msme.gov.in) for recovery of the principal amount together with interest under Section 16, and take such other steps as are available to us in law, at your risk as to costs and consequences.
8. This notice is issued without prejudice to all our other rights and remedies.
For [SUPPLIER'S NAME]
______________________________
[NAME OF AUTHORISED SIGNATORY]
[DESIGNATION]
Enclosures:
1. Udyam Registration Certificate
2. Purchase order / work order / agreement
3. Invoices and delivery challans / proof of service with acknowledgement of receipt
4. Ledger account / statement of outstanding
5. Copies of earlier reminders (if any)
NOTES BEFORE SENDING — delete this part
Who can use this notice: a micro or small enterprise that holds Udyam Registration. Medium enterprises are not covered by Sections 15–18.
Payment period (Section 15): the agreed date, but never more than 45 days from the day of acceptance (or deemed acceptance) of the goods or services. Where nothing was agreed, payment is due before the appointed day — the day following 15 days from acceptance.
Interest (Section 16): compound interest with monthly rests at three times the bank rate notified by the RBI. Take the current Bank Rate from the RBI website (rbi.org.in, "Current Rates") and multiply by 3. For monthly compounding: amount due × ((1 + rate ÷ 12)^months − 1).
The interest under Section 16 applies "notwithstanding anything contained in any agreement" — a lower contract rate does not cut it down.
If the buyer does not pay, the reference to the MSE Facilitation Council (Section 18) is filed online on the MSME ODR portal. Keep the notice, postal proof and delivery report for that filing.
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