A Clonmel-based electrical services business claims it went out of business because a division of Bord Gais did not pay a bill worth hundreds of thousands of euro.
MP Ryan, which provided electrical instrumentation and anti-corrosion services to numerous big-ticket clients, closed its doors earlier this year.
The company is blaming an "unpaid debt" from Bord Gais Networks (BGN) for forcing it to close its doors.
According to MP Ryan, it took high court action against Bord Gais Networks in June to force payment of a €65,000 debt. BGN eventually paid that amount just before the court case, leaving MP Ryan with legal costs of €10,000.
It also claims BGN has unpaid bills worth more than €200,000, which forced it to cease trading.
However, BGN said it "has paid all invoices submitted to the company by MP Ryan".
"MP Ryan has submitted two claims for works completed. We assessed the claims and made an offer. . . which was rejected.
"BGN agreed on June 27, 2012, to enter mediation to resolve these claims but the company has not received a response since that date," the company added.
Details of the dispute emerged after the head of the Office of Public Works, Clare McGrath, defended the state tender process, and its role in giving SMEs access to state contracts to the Oireachtas Committee on Jobs and Enterprise.
Ms McGrath said 97pc of contracts were paid within 30 days, while nearly two-thirds were settled in 15 days.
The OPW has no responsibility with the tender process other than to ensure it runs smoothly. However, Sinn Fein TD Peadar Toibin said it did have a moral responsibility.
"If it awards contracts to companies that have a history of not delivering services or payments to contractors on time then it would seem to have a moral responsibility for the problems SMEs are facing in this area," he said.