(1) Where any buyer is required to get his annual accounts audited under any law for the time being in force, such buyer shall furnish the following additional information in his annual statement of accounts, namely:—
- (i) the principal amount and the interest due thereon remaining unpaid to any supplier as at the end of each accounting year;
- (ii) the amount of interest paid by the buyer in terms of section 16, along with the amount of the payment made to the supplier beyond the appointed day;
- (iii) the amount of interest due and payable for the period of delay in making payment;
- (iv) the amount of interest accrued and remaining unpaid at the end of each accounting year; and
- (v) the amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues as above are actually paid.
Legal Commentary & Landmark Judgments: Section 22
Section 22 of the MSMED Act mandates that every buyer required to have its accounts audited under any law must explicitly disclose outstanding unpaid dues to MSME suppliers, along with accrued interest, in its annual financial statements.
Section 22 imposes severe accounting discipline on corporate entities. Failure to disclose MSME dues or misreporting them constitutes a statutory violation under Section 27 and triggers penal consequences under the Companies Act, 2013 and reporting obligations for statutory auditors under CARO (Companies Auditor's Report Order).