India, Feb. 10 -- The latest insertion of the new clause 'h' to Section 43B of the Income Tax Act is making quite some feathers in the MSME sector in India. According to this clause, an MSME enterprise needs to be paid for the goods bought from it within 15-45 days of the purchase to claim a deduction in the assessment year 2024-25.

This means that the rule of Section 43B of allowing certain deductions on actual payments has been extended to payments due to MSMEs and the period for these MSME payments is as specified in Section 15 of the Micro, Small and Medium Enterprises Development Act, 2006 (MSME Act). As of now, the applicability of this new clause will be effective from April 1st, 2024. In case of non-payment by 31st March 2023, th...