(MENAFN- KNN India) New Delhi, Nov 17 (KNN) A high-level committee led by NITI Aayog member Rajiv Gauba has recommended 17 reforms aimed at reducing regulatory and financial burdens on Micro, Small and Medium Enterprises (MSMEs).

The proposals, currently under examination by relevant ministries and departments, seek to improve credit access, simplify compliance under the Companies Act, streamline tax procedures, expedite payment dispute resolution, and ease Corporate Social Responsibility (CSR) obligations, reported TOI.

The committee has also outlined indicative timelines for implementation.

To strengthen credit flow, the panel has suggested expanding the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) to include manufacturing medium enterprises.

It has also proposed extending credit guarantee cover to receivables on the Trade Receivables Discounting System (TReDS) to support faster payments and ease liquidity constraints.

Addressing persistent delays in arbitration-related payments particularly by government entities the committee has recommended reinforcing the mandatory pre-appeal deposit of 75 per cent of the arbitral award value under the MSME Development Act.

It has proposed amending the law to ensure actual deposit of the amount and enabling partial release of at least 50 per cent of the dues to micro and small suppliers after six months.

The appointment of a sole arbitrator has also been suggested to quicken dispute resolution.

In compliance-related reforms, the panel has advised exempting all micro and small companies from mandatory CSR obligations by amending existing criteria based on net worth, turnover, and profit thresholds.

Other recommendations include reducing required board meetings from two to one annually, removing the mandate for auditor appointments for companies with turnover below Rs 1 crore, and raising the tax audit exemption limit for firms with more than 5 per cent cash receipts from Rs 1 crore to Rs 2 crore.

(KNN Bureau)

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