MSME Registration : Micro, Small and Medium Enterprises Under MSME Act
To promote the growth of Micro, Small & Medium Enterprises, the government of India gives various concessions and extends financial assistance exclusively to the units or enterprises which qualifies to be a micro, small and medium enterprises. The Micro Small & Medium Enterprises Development Act 2006 makes it mandatory for MSME to register themselves with government and to obtain Udyog Aadhar for availing benefits provided under MSME Development Act.
The terminology like MSME, SSI or Udyog Aadhar is one and same thing. In other words, there is only one registration which a micro, small and medium enterprises has to obtain and that is UDYOG AADHAR. MSME is the backbone of the modern Indian economy and is considered as the growth engine for equitable and sustainable economic development of the country. Under MSME all kinds of enterprises can obtain registration, like manufacturers the service providers are also eligible for MSME benefits. Hence they are also required to get UDYOG AADHAR Registration.
1. Micro Enterprise
An enterprise which is engaged in manufacturing can be classified as a Micro Enterprises in case the total investment in its plant and machinery is less than Rs. 25 Lakhs. However in case the enterprise deals in service sector then the said investment must be less than 10 Lakh, during the financial year.
An enterprise which is engaged in manufacturing can be classified as a Small Enterprises in case the total investment in its plant and machinery is more than Rs. 25 Lakhs but does not exceed Rs. 5 Crores. However in case the enterprise deals in service sector then the said investment must be more than 10 Lakh but must not exceed Rs. 2 Crores.
3. Medium Enterprise
An enterprise which is engaged in manufacturing can be classified as a Medium Enterprises in case the total investment in its plant and machinery is more than Rs. 5 Crores but does not exceed Rs. 10 Crores. However in case the enterprise deals in service sector then the said investment must be more than 2 Crores but must not exceed Rs. 5 Crores.
Benefits of MSME in Brief
An MSME is entitled to many benefits such as a reduction in the fee for the filing of trademark, copyright, patent, and design applications. Further, all government department has to necessarily source their supplies from a MSME. The benefits of the MSME Registration is provided in the following section of this page.
EASY AVAILABILITY OF LOAN
Every MSME whether in the manufacturing sector or service sector is entitled to collateral or mortgage-free loan from Bank for an amount up to Rs. 1 Crore through SIDBI under the Credit Guarantee Scheme.
GOVT. PROCUREMENT PRIORITY
Central or state government departments have been mandated to extend priority treatment to MSME while procuring goods or services for the consumption of goods or services for public purposes.
While availing bank overdraft facility from a bank, MSME has a reason to smile as Banks need to offer 1% less interest rate on the overdraft extended to the MSME which is registered with Udyog Aadhar.
TA registered MSME can avail concessional rate of electricity for their unit by making a written application along with the certificate issued after registration as MSME ( Udyog aadhar) to the electricity department.
SPEEDY RECOVERY OF DUES
The MSME is required to be paid as per the agreement between parties or within 45 days if there is no understanding between them. Failure entitles the MSME for an interest which is three times the bank rate.
REBATE IN TAXES
MSME registered under the MSMED Act, 2006 is eligible for many tax incentives and exemption both under the Direct Taxes and Indirect Taxes including GST such as capital gain subsidy schemes under income tax act.
50% DISCOUNT ON IP PROTECTION
While filing the trademark application in any class or multiple class, the MSME enjoys 50% less fee of filing in comparison to other corporates or firms. Similarly while filing a patent 50% discount is granted to the MSME.
MSME CONCILIATION CENTRE
For faster resolution of disputes where MSME is struggling to recover money from other persons, there is a provision of MSME reconciliation center which may provide for a speedy resolution of a dispute and faster recovery.
Documentation of MSME Registration:
Udyog Aadhar is a free facility by government, and there is no fee charged by government.
PAN Number in case of company, LLP or cooperative society, it is optional in all other cases.
Aadhar number and pan of the applicant, an OTP shall go to his mobile and email id for confirmation.
Address Proof of Establishment, either in the form of a sale deed or valid rental agreement.
Bank Account Information (bank statement and canceled cheque).
NIC Code of the products and services in which the enterprises are dealing at the time of registration.
Note: You can do the MSME Registration from your end for free but you are unable to do so, then we can do it from our end with a consultancy fee Rs. 777/- ( seven hundred seventy-seven Rupees)
Please email your documents or Whatsapp the same to us. The rest will be done from our end.