Filing Entrepreneur Memorandum Not Mandatory Under MSME Act: Himachal Pradesh High Court

The Himachal Pradesh High Court has held that filing an Entrepreneur Memorandum is not a mandatory requirement for micro and small enterprises under the Micro, Small and Medium Enterprises Development Act, 2006.The Court remarked that micro and small enterprises are not bound to file the Entrepreneur Memorandum within 180 days of commencement of the MSMED Act, as the filing was voluntary, which was clarified by a 2007 government notification.Justice Sandeep Sharma remarked that:“…notification clarifying that for micro and small enterprises… there is no limitation of 180 days… and these enterprises can file EM anytime they decide to do.”Background: The petitioner, CBM Industries, was registered with the District Industries Centre, Nahan, in 2004 and began production in 2005. An order was placed by Northern Railways in May,2007 and all goods were supplied with good quality. However later in June 2007, Northern Railway stopped payments alleging higher rates, and initiated vigilance inquiries and CBI investigations. A report was submitted by Central Bureau of Investigation, as per which there was no evidence of overpricing or wrongdoing. The Court observed that the cause of action arose in September 2015, when Northern Railway formally denied liability of payment through its letter. Thereafter, CBM approached the the Micro and Small Enterprises Facilitation Council under Section 18 of the MSME Act. In 2018, the arbitrator awarded CBM a principal amount of ₹4.80 crore along with interest of over ₹50 crore. In response, Northern Railway contended that the claim was time barred and CBM was not a valid supplier as it delayed in Entrepreneur Memorandum filing. Case Name: Controller of Stores, Northern Railway v/s M/s CBM Industries Pvt. Ltd. and Anr. Case No.: CARBC No.6 of 2018Date of Decision: 20.11.2025For the Petitioner: Mr. Vir Bahadur Verma, Senior Panel CounselFor the Respondents: Mr. Sunil Mohan Goel, Senior Advocate with Mr. Vibhu Anshuman, Mr. Raman Jamatla, Mr. Vipul Sharda, Mr. Prateek Kumar, Mr. Yuvan Raj Gandhi, Mr. Abhinav Mohan Goel and Mr. Neeraj Kumar, AdvocatesClick Here To Read/Download Order

Filing Entrepreneur Memorandum Not Mandatory Under MSME Act: Himachal Pradesh High Court

Mehak Aggarwal

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