Dear Mr Rautray
We have gone your various comments on MSME act on this portal. We are micro level unit/MSME unit registered with local DIC with Udyog adhaar no. We have query. We are supplying material to Govt department . Please see a hypothetical situation .
Total 800 Pieces to be delivered. Agreement was dated 03/ 2013 with 6 months delivery period i.e till 09/2013 . Terms of payments – “On receipt of material in Good condition”
Liquadation damages – Maximum 10% of agreement value . Consideration to be given for genuine delays in supply to supplier
1st RA (running account bill) – 200 Pcs delivered by 06/2013 - full Payment received in 10/2013
2nd RA – 200 Pcs - delivered by 11/2013 - Payment received in 06/2014 (10% payment with held by govt department on account of delayed delivery. This 10% can be released after time extension application is approved by govt department at the time final Bill )
3rd RA –400 Pcs - Delivered by 06/2016 - Payment received in 11/2016 (10% payment with held )
Final Bill is submitted along with 3rd RA along with Time extension application citing reasons for delay.If Govt finds delays genuine they release the With HELD amounts . This particular time extension application is pending for approval from the Govt department side till date 07/2018. Therefore Agreement is still running and in continuation.
Now our main query is , will LIMITATION ACT apply (3yrs time limit) if we file Interest on delayed payments on 1st and 2nd RA bill as payment for 1st and 2nd RA bill has crossed 3yrs limit ? Or Limitation act WONT be applicable as agreement is still subsisting as on today (07/2018) since all our payments have not been cleared yet?? We hope the MSEFC council wont reject our claim when we file it on limitations act grounds
We are not able to file interest on delayed payments as the Govt department might in retaliation impose heavy Liquadation damages on us and deduct our entire 10% amount which are with held with them? We prefer to close agreement first after approval of time extension application , take out maximum amount from govt after that file for MSME interest.
Please enlighten and suggest how we must move forward as we are stuck from both sides.
Looking forward to hearing from you