Section 15 is often summarised as a 45-day rule, but 45 days is only a ceiling on what the parties may agree in writing. With no written agreement the buyer must pay before the appointed day, which falls 15 days after acceptance. The result depends on when acceptance, or deemed acceptance, occurs.

1. The rule has two tracks, not one

Section 15 requires a buyer to pay on or before the date agreed in writing or, where there is no agreement, before the appointed day. A proviso adds that no written agreement may allow more than 45 days from the day of acceptance or deemed acceptance. Section 2(b) defines the appointed day as the day following the expiry of 15 days from acceptance or deemed acceptance.

2. When does the clock start?

Time runs from acceptance, and the Act defines it by two situations in the explanation to section 2(b). If the buyer makes no written objection within 15 days of delivery or of the service being rendered, the day of deemed acceptance is the day of actual delivery. If the buyer does object in writing within those 15 days, the day of acceptance is the day the supplier removes the objection.

This makes the 15-day objection window the most important operational fact in the section. A buyer that inspects goods but raises no written objection has accepted them for the purposes of the Act, however long its own approval workflow takes. A supplier that receives a written objection should record the date it cures the defect, because that date restarts the clock.

3. Four timelines from one delivery

Assume goods are delivered on 1 June.

4. What “agreed in writing” should mean in practice

The proviso presupposes an agreement between buyer and supplier. A payment term sitting in the buyer’s ERP master, or in standard terms the supplier never saw, is a weak foundation. The safer course is a purchase order or contract that carries the payment term and is acknowledged by the supplier. Where the document is silent or contradictory, the buyer should expect the 15-day default to be argued against it.

Where a contract provides for more than 45 days, the buyer should not plan around the longer period. Section 16 applies notwithstanding any contrary agreement, and the proviso is framed as a limit on what may be agreed. Check the current treatment before relying on any term beyond 45 days.

5. How one deadline drives three consequences

•      Interest: a missed section 15 deadline starts compound interest under section 16 (Article 3).

•      Tax: a sum paid beyond the section 15 limit becomes a clause (h) timing issue if it crosses a year-end (Article 1).

•      Reporting: MSME-1 is triggered at 45 days, not 15. An invoice with no written agreement paid on day 30 is late under section 15 and attracts interest, but is not reportable on MSME-1 (Article 4).

6. Drafting and process fixes

•      State the payment term and the acceptance procedure in the purchase order, and keep the supplier’s acknowledgement.

•      Record the delivery date and any written objection date in separate fields from the invoice receipt date.

•      Set alerts at day 10 and day 40 so that a 15-day default or a 45-day cap is not missed.

Where quality is disputed, object in writing within 15 days, with reasons