New Delhi, April 23 -- Small exporters in India have requested the government to extend the amnesty scheme for one-time settlement of default in export obligations until September 2024.

The appeal comes from a Ludhiana based Hand Tools Association where its President, S.C. Ralhan stated that many small exporters were unable to take advantage of the scheme due to their obligations to make payments to Micro, Small, and Medium Enterprises (MSMEs) within 45 days.

The Finance Act 2023 introduced Section 43B(h) in the Income Tax Act, which stipulates that larger companies cannot deduct expenses from their taxable income if they fail to pay MSMEs within 45 days of a written agreement.

Consequently, small exporters had to divert their funds to...