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MSME REGISTRATION

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+ 91 9875939051, 9875939052

Micro, Small & Medium Enterprises (MSME)

Introduction

Micro, Small and Medium enterprises have been the backbone of our economy for quite a long time. Their contribution to the industrial growth of our economy and towards growth in export capabilities and employment opportunities has been exemplary. That is why keeping in line with the government’s vision for Atmanirbhar Bharat, there is now a renewed focus and thrust for providing greater facilities to MSMEs and for improving the overall MSME landscape in the country. The recent changes in the definition of MSMEs and provisions for greater benefits to the MSMEs is the first step towards that direction.

Defination of Micro, Small & Medium Enterprises (MSME)

As per the provisions of MSMED Act, 2006 the Micro, Small and Medium Enterprises are classified in two categories i.e. Manufacturing Enterprises & Service Enterprises

  • Manufacturing Enterprises: The enterprises which are engaged in the manufacturing or production of goods related to any industry or using plant & machinery for the process of value addition to the final product having different name or usage or character. The manufacturing Enterprises are defined based on TURNOVER* and INVESTEMNT** IN PLANT & MACHINERY.
  • Service Enterprises: The enterprises engaged in rendering or providing services and are defined in terms of TURNOVER* AND INVESTMENT** IN EQUIPMENTS.

* Turnover and export turnover information will be linked to Income Tax Retur n or GST Portal. Export value of goods and services shall be excluded for the purpose of determining classification. New entities shall be given an option to fill Turnover figures on a self-declaration basis.

** Similarly, Investment in Plant & Machinery or equipment will be linked with the Income Tax Return filed by the entity in previous years. Relaxation is provided to new enterprises by allowing self-declaration of investment value by the promoters where no prior ITR is available. However, such relaxation shall cease after 31st March of the financial year in which first ITR is filed.

Revised Classification of Micro, Small & Medium Enterprises (MSME) as Announced by Finance Minister dated 13th May 2020 under Atma Nirbhar Bharat Yogjna

The revised classification is based on Turnover and Investment in Plant & Machinery/ Equipment are mentioned herewith:

Revised MSME Classification w.e.f 01/07/2020
Composite Criteria : Investment in Plant & Machinery or Equipment and Annual Turnover
Classification Micro Small Medium
Manufacturing & Service Enterprises Investment ≤ 1 crore
And
Turnover ≤ 5 crore 		Investment ≤ 10 crore
And
Turnover ≤ 50 crore 		Investment ≤ 50 crore
And
Turnover ≤ 250 crore

Benefits of MSME Registration

1. Easy Bank loans without Collateral/ Mortgage: The Government of India and SIDBI has launched a Credit Guarantee Scheme (CGSME) to make available collateral free credits to SMEs.
2. One Percent (1%) exemption on interest rate on Bank Overdraft (OD): Enterprises that have MSME Registration can avail benefits of 1% exemption on interest rate on Over draft facility.
3. Preference in Procuring Government Tenders: The Government of India gives special preference in buying from Micro & Small Businesses through Government Tenders.
4. Protection from delayed payments: The ministry for MSMEs gets protection against late payments from buyers through conciliation, arbitration and settlement of disputes under minimal time frame. In case of registered micro, small and medium enterprises – buyers are required to make payments within 15 days of accepting goods or services.In case of payment delays, a buyer needs to pay compound interest with monthly interest rates on the amount within the next 45 days. Furthermore, a hefty penalty is charged on the buyer as mandated by the Reserve Bank of India.
5. Reimbursements of the ISO certification charges: Enterprises with MSME registration certificate are eligible to claim compensations from ISO certification expenses by applying a formal petition to the respective authority.
6. Exemption from Stamp Duty: MSME registered enterprises gets exemption from stamp duty for the purpose of setting up of Industry.
7. Special discount on Government fees for Trademark & Patents: Enterprises that have MSME Certificate can avail subsidy for patent & trademark registration.
8. Fast resolution of disputes: Enterprises undergoing a dispute with regard to payments may refer the dispute to the MSME Facilitation Council for conciliation & arbitration.
9. Benefits of Different Schemes/ Program offered to MSMEs: Registered Enterprises enjoys the benefits of many schemes & Program like Cluster Development Scheme, Infrastructure Development Program, Financial Support in ZED Certification Scheme and like.
10. Other benefits: Other benefits available to MSMEs include fewer formalities for licenses and approvals, reduced electricity bills, opportunity to participate in international trade fairs, preference in government schemes, concessions in security deposits in tenders and various other incentives by the Central and State Governments.
Documents/ Information Required for MSME Registration/ Udyamregistration
Aadhaar No.
Name of Entrepreneur
Aadhar should be linked to entrepreneur’s mobile number for OTP Validation
PAN
ITR filing details for previous year
GSTIN (GST No.)
Mobile Number and E-mail ID
Social Category and Gender of Entrepreneur
Name of Enterprise,Type of Organization, Location of plant/unit, Major Activity, Official Address of Enterprise, Date of Incorporation, Date of Commencement of operations are required
Bank Details
No. of Employees Employed
Investment in Plant & Machinery or Equipment, Total Turnover and Export Turnover
Who is eligible for MSME Registration?

Proprietorships, Hindu Undivided Family, Partnership Firm, One Person Company, Limited Liability Partnership, Private Limited Company, Limited Company, Producer Company, any association of persons, co-operative societies or any other undertaking can obtain MSME registration in India

Micro, Small and Medium Enterprises (MSMEs) are crucial for the economic growth and stability of our country and have played a vital role in economic and industrial progress of our country and in providing employment opportunities, thus contributing to poverty reduction.

SSI stands for Small Scale Industries which is another term used for MSMEs. As such, there is no such difference between SSI and MSME.

Consequent to the increased globalization of the Indian economy and changed industrial environment, MSME Ministry is currently focusing on providing support in the fields of credit, marketing, technology and infrastructure to MSMEs. It is also working on ways and means of encouraging entrepreneurship development, improving market access, promotion of quality products and support for product development, designing and packaging.

Aadhar number shall be of proprietor in case of proprietorship firm, of managing partner in case of partnership firm and of karta in case of HUF. In other enterprises, it shall be of authorized signatory.

Plant and machinery or equipment shall have the same meaning as given to it in the Income Tax Act and shall include all tangible assets other than land and building, furniture and fixtures. Investment in Plant & Machinery or equipment will be linked with the Income Tax Return filed by the entity in previous years. Relaxation is provided to new enterprises by allowing self-declaration of investment value by the promoters where no prior ITR is available. However, such relaxation shall cease after 31st March of the financial year in which first ITR is filed.

Turnover and export turnover information will be linked to Income Tax Act or GST Portal. Export value of goods and services shall be excluded for the purpose of determining classification. New entities shall be given an option to fill Turnover figures on a self-declaration basis.

Any number of activities be it manufacturing or service can be added in one Udyam Application. There is no need for more than one registration.

All enterprises which had obtained registration upto 30th June, 2020 need to be reclassified as per the new criteria. All such enterprises need to register themselves under Udyam Registration. Registrations done upto 30th June, 2020 shall continue to remain valid only till 31st March, 2021.

The classification of an enterprise will get updated in future years based on information gathered from ITR or GST Returns filed by the enterprise. The enterprise will be duly informed whenever there is any change in the status of the enterprise.

Fees Rs 1000.00 (Ex GST)