Micro, small, and medium enterprises are the backbone of the Indian economy, yet they are also among the most vulnerable to the consequences of payment defaults by larger buyers and counterparties. Delayed payments are not merely a commercial inconvenience for MSMEs. They are often an existential threat, straining cash flow, disrupting operations, and undermining the viability of businesses that have extended credit in good faith.
KK Associates has developed a dedicated MSME practice that is specifically designed to address this reality. We leverage the powerful statutory framework created by the Micro, Small and Medium Enterprises Development Act, 2006 to secure expedited and cost-effective recovery for MSME clients, utilising mechanisms that are specifically designed to redress the power imbalance between MSMEs and their larger counterparties.
The MSMED Act provides MSMEs with a suite of statutory rights that are not available to ordinary commercial creditors, including the right to compound interest on delayed payments at a rate specified by the Reserve Bank of India, the right to initiate conciliation and arbitration before the MSME Facilitation Council, and the availability of an expedited dispute resolution process that operates outside the conventional court system. These rights, when properly deployed, give MSMEs a significant advantage in recovering overdue amounts.
We represent MSME clients before the MSME Facilitation Council, in conciliation and arbitration proceedings initiated under the MSMED Act, and in the enforcement of awards and orders obtained through these proceedings before the relevant courts. We have successfully represented MSME suppliers in recovery proceedings under the MSMED statutory framework, utilising statutory interest provisions and expedited processes to secure timely and enforceable relief for significantly delayed payments, including the recovery of accrued statutory interest that substantially increased the overall recovery amount.
Our approach for MSME clients is focused on securing prompt, practical relief, while advising strategically on the use of mediation, conciliation, and parallel remedies to maximise the overall recovery position. We understand that MSMEs cannot afford the cost, delay, and uncertainty of protracted commercial litigation, and we design our strategies accordingly. Our goal is always to achieve the best possible outcome in the shortest possible time, using the most cost-effective legal tools available.