POSH Act & Requirement of filing Annual report

 

POSH Act & Requirement of filing Annual report for 2023 by 31st January, 2024

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act was passed in 2013 and it got amended in 2023 with certain important stipulations. As an employer, it is very important for you to be aware of the provisions, the compliance requirements and the penalties for non-compliance.

 

As gender equality and women’s rights are in the forefront of the social and governance attention, any lapse in the compliance may have far-reaching implications.

 

Let us see a gist of the POSH Act compliance.

 

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act was passed in 2013, laying down the procedures for a complaint and inquiry, and the action to be taken.

 

1.    POSH Act is applicable on every Company, workspace, establishment or organization employing 10 or more employees whether full time, part time, interns or on contract, irrespective of its nature of industry of location.

 

It is applicable to all including proprietary, firms, companies or any other entity.

 

2. Internal Committee: Internal Complaints Committee has to be mandatory set up in each establishment with 1 Presiding Member, 2 Employee Members and  & 1 external members in case of bigger entities.

 

Presiding Officer who shall be a woman employed at a senior level at workplace from amongst the employees and at least one-half of the total Members so shall be women.

 

3.     Formulation of Internal POSH Policy.

 

Entity should formulate a POSH Policy and circulate it amongst its employees.

 

4.  Workshops, Awareness and Orientation Programs has to be Organized by the employer to the employees.

 

5.   Submitting Reports under the Act: The Internal Complaints Committee or the Local Committee, in every calendar year, shall prepare and submit an annual report to employer and district officer.

 

There is a specific format for this Annual Report.

 

The due date to file the report with the District Officer is 31st of January for every year for the preceding calendar year.

 

6.     Penalties: When the employer fails to constitute an Internal Committee or breaches provisions of this Act or any rules made thereunder, they shall be punishable with fine of fifty thousand rupees.

Extended penalties shall be:

·       Cancellation or withdrawal of his license.

·       Non-renewal, or cancellation of the registration.

·    The employer shall be punishable with fine which may extend to Rs. 50,000/- for the first offence.

 

7.     Disclosure regarding the POSH act compliances must be reported every year in Board report of the Company.

Very important amendment in Income Tax relating to MSME

You buy goods or services from an MSME:

You have to pay the amount _within 45 days from the date of acceptance of goods of services_ (or within such shorter time as agreed between the parties)

But If you fail to pay the amount due to an MSME within 45 days, then what is the consequence?

1.  You have to pay interest @ 20.25% from the 45^th day till the date of payment.

(This interest is not deductible as an expenses under Income Tax Act)

2. But most importantly, there is an amendment in the Income Tax Act from FY 2023-24 which says “YOU CANNOT CLAIM THAT PURCHASE OF GOODS OR SERVICES AS AN EXPENSE”. But you can claim the expense in the year in which you have paid the MSME.

 For example, if you buy Rs. 10 lakhs worth of goods from an MSME which is overdue for more than 45 days and is outstanding as on 31^st March,  then you will have to pay about Rs. 3.40 lakhs plus interest additionally, as Income Tax.

You have to identify, out of your creditors,  who all are MSMEs and ensure that their dues are settled in time.

So please take care that you pay all your MSME creditors within 45 days and clear the all dues to MSME outstanding for more than 45 days before March 31^st.

To MSME suppliers : Do not forget to mention your MSME registration number in your quotes, contracts, invoice and other communications with your customers.