New Delhi, April 30 -- Three prominent trade associations have approached the Supreme Court challenging a recent amendment to the Income Tax Act that impacts payments made to micro and small enterprises (MSMEs).

The Federation of All India Vyapar Mandal, Federation of Madras Merchants and Manufacturers Association, and Confederation of West Bengal Trade Associations filed petitions on April 27, seeking an interim stay and eventual quashing of the contentious provision introduced through the Finance Act 2023.

The petitions take issue with the amendment that requires companies to wait an entire fiscal year for tax deductions if they fail to make payments to MSMEs within the stipulated time frame under the MSMED Act, 2006. This provision c...