MSME and relevant compliances

Micro, Small and Medium Enterprises (MSME) are classified in two Classes under Micro, Small & Medium Enterprises Development (MSMED) Act, 2006:

  1. Manufacturing Enterprises
    The enterprises engaged in the manufacture or production of goods pertaining to any industry specified in the first schedule to the industries (Development and regulation) Act, 1951) or employing plant and machinery in the process of value addition to the final product having a distinct name or character or use. The Manufacturing Enterprise are defined in terms of investment in Plant & Machinery.
  2. Service Enterprises
    The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment..

The limit for investment in plant and machinery / equipment for manufacturing / service enterprises, as notified, vide S.O. 1642(E) dtd.29-09-2006 are as under

Manufacturing Sector

    Enterprises  Investment in plant & machinery
    Micro Enterprises  Does not exceed twenty five lakh rupees
    Small Enterprises  More than twenty five lakh rupees but does not exceed five crore rupees
    Medium Enterprises  More than five crore rupees but does not exceed ten  crore rupees

Service Sector

    Enterprises  Investment in equipments
    Micro Enterprises  Does not exceed ten lakh rupees:
    Small Enterprises  More than  ten lakh rupees but does not exceed two crore rupees
    Medium Enterprises  More than two crore rupees but does not exceed five core rupees

Benefits of Registration as MSME (Udyog Aadhar)

  1. Protection against delay in payment.
  2. Fast resolution of disputes
  3. Collateral Free loans from bank
  4. Exclusive consideration for participating in international trade fair
  5. Octroi benefits
  6. Waiver of Stamp duty and Registration fees
  7. Several Exemption under Direct Tax Laws
  8. Barcode registration subsidy
  9. Subsidy on NSIC Performance and Credit ratings
  10. Counter Guarantee from GoI through CGSTI
  11. Reduced rate of interest from banks
  12. 15% subsidy under CLCSS scheme for technology upgradation
  13. Exemptions while applying for Government tenders
  14. Concession in Electricity Bills
  15. Reimbursement of payment made for obtaining ISO certification
  16. 1% exemption in interest on OD
  17. Increasing eligible loan limit for optimal reasons, from the amount of Rs. 25 lakh to Rs. 50 lakh
  18. Raising the extent of guarantee cover from 75 % to 80 %
  19. Reservation of products for exclusive manufacturing by MSME/SSI
  20. Easier registration and approvals to obtain Licenses
  21. Eligible for IPS subsidy
  22. Preference in allocation of Government tenders
  23. Excise Exemption Scheme
  24. Reduced rate of interest from banks
  25. 50% subsidy for patent registration

2 Comments on "MSME and relevant compliances"

  1. Thank you.
    your information is useful to us.
    keep sharing.

  2. thankyou so much for sharing such useful information. this article has helped me a lot. it has provided a good piece of information on MSME. keep writing.

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