Apply sections 26-32 and keep section 25’s limited closure power in its correct chapter and time frame.
Published by Finin2min · Source review: 24 October 2026
Rules, conditions and exceptions
- Chapter VI starts at section 26, not section 25. Section25, still within Chapter V, concerns a Central Government scheme for closure of non-company enterprises and limits the enabling notification to one year from commencement. It is not a provision for closing the Advisory Committee or a general current licence to dissolve every company.
- Section26 allows the Central or State Government to appoint officers/employees and entrust functions. An appointed officer may, by order, require prescribed information for the Act’s purposes. The order, requesting officer and prescribed form matter; this is not an unbounded demand by any private counterparty.
- Section27(1) concerns intentional contravention, attempt or abetment of the specified section 8(1) or 26(2) provisions. The first conviction carries a fine up to Rs 1,000; a second/subsequent conviction carries Rs 1,000-Rs 10,000. The required conduct and conviction categories must not be turned into an automatic late-invoice fee.
- Section27(2) separately addresses a buyer’s section 22 annual-account disclosure contravention, with a fine not less than Rs 10,000. It is distinct from the section 16 interest on delayed supplier payments; neither head should be labelled as the other.
- Section28 requires a court no lower than Metropolitan Magistrate or first-class Magistrate for offences. These offences/fines are not the Council’s section 18 money-award procedure. The cited2026 Jan Vishwas Schedule was checked and does not amend MSMED2006; no general claim that every MSME offence was decriminalised is made.
- Section29 gives Central rulemaking and the specified parliamentary laying process; section 30 gives State rulemaking, including Council composition, vacancies and procedure, with State legislative laying. A procedure from one State does not automatically become every State’s Council rule.
- Section31’s power to remove difficulties is limited to two years from the Act’s commencement. Section32 repeals the 1993 delayed-payments Act with savings for prior action under corresponding provisions; it does not erase all historic rights or records.
Provision map
| Provision | Subject or calculation | Primary source |
|---|---|---|
| 25(context) | Chapter V: limited non-company business closure scheme | PDF page 11 |
| 26 | Officers and prescribed information orders | PDF page 11 |
| 27 | Specified contraventions and conviction fines | PDF page 11 |
| 28 | Offence trial-court threshold | PDF page 12 |
| 29 | Central rules and parliamentary laying | PDF page 12 |
| 30 | State rules and legislative laying | PDF page 12 |
| 31 | Two-year difficulty-removal power | PDF page 12 |
| 32 | 1993Act repeal and savings | PDF page 13 |
Worked example
A buyer’s audited annual accounts omit the section 22 supplier disclosures. The section 27(2) reporting-offence branch is examined separately from any delayed-payment interest owed to the supplier. A Rs 10,000 reporting fine is not a substitute calculation of section 16 interest, nor a fee that the supplier may automatically add per invoice.
Questions answered
Does Chapter VI begin with section 25?
No. Chapter VI begins with section 26; section 25 remains in Chapter V.
Is every delayed invoice automatically fined Rs 10,000 under section 27(2)?
No. That subsection concerns section 22 annual-account disclosure contravention, not an automatic per-invoice late fee.
Does section 25 close the Advisory Committee?
No. It concerns the stated time-limited business-closure scheme power for non-company enterprises.
Primary sources
- Micro, Small and Medium Enterprises Development Act 2006: India Code text. Sections25-32; PDF pages11-13.
- Jan Vishwas (Amendment of Provisions) Act 2026, Act 8 of 2026. Schedule reviewed for MSMED references; the cited2026 Act does not list an amendment to MSMED2006.
Source review24October 2026. This guide explains the identified provisions and primary judgments. Its illustrations do not decide an individual matter or replace an operative court order.