- \r\n
- An Overview of MSME Sector<\/a><\/li>\r\n
- Sources of Finance for MSME\u2019s<\/a><\/li>\r\n
- Advantages of MSME Registration<\/a><\/li>\r\n
- Classification of Micro, Medium and Small Enterprises<\/a><\/li>\r\n
- Eligibility for MSME Registration<\/a><\/li>\r\n
- Facilities to MSME\u2019s<\/a><\/li>\r\n
- Checklist<\/a><\/li>\r\n
- Documents required for MSME Registration <\/a><\/li>\r\n
- Process of MSME Registration in India <\/a><\/li>\r\n
- MSME schemes launched by the Government <\/a><\/li>\r\n
- Takeaway <\/a><\/li>\r\n<\/ul>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n\r\n\r\n\r\n
An Overview of MSME Sector<\/strong><\/h3>\r\n
The Micro, Small, and Medium Enterprise abbreviated as MSME is the backbone of a progressive country like India. The central objective to establish the MSME sector was to empower the development of micro, small, and medium enterprises. It majorly contributes to the manufacturing, employment, exports, and industrial units.
To undertake any business operations, an entrepreneur must have enough funds. Considering the inadequacy of capital in startups, the Government enables collateral-free credit. It ensures to provide the fund requirement of micro and small sector enterprises. Such an initiative is a boon for both the old and new enterprises. Moreover, the Government has introduced a trust namely \u2018The Credit Guarantee Trust Fund Scheme\u2019 and SIDBI(Small Industries Development Bank Of India) to further guarantee the implementation of Credit Guarantee Scheme for all SSI\u2019s.
One can get multiple other benefits like a hassle-free opening of bank accounts, the grant of bank loans at lower interest rates, discarding stamp duty<\/a> and registration charges, etc.<\/p>\r\n\r\n\r\n\r\nSources of Finance for MSME\u2019s<\/strong><\/h3>\r\n\r\n\r\n\r\n
\r\n![\"\"](\"https:\/\/legalwindow.in\/wp-content\/uploads\/a.png\")
<\/figure>\r\n<\/div>\r\n\r\n\r\n\r\nSource: ICSI<\/p>\r\n\r\n\r\n\r\n
Advantages of MSME Registration<\/strong><\/h3>\r\n
Registration of Micro, Small and Medium (MSM) Enterprises under MSMED Act provides various benefits and incentives offered by the Central Government which includes the following:<\/p>\r\n
- \r\n
- Easy finance availability from Banks, without collateral requirement<\/li>\r\n
- Multiple Tax Rebates<\/li>\r\n
- Preference in obtaining Government tenders<\/li>\r\n
- Benefits in Stamp duty and Octroi<\/li>\r\n
- Exemption under Direct Tax Laws.<\/li>\r\n
- Financial help for setting up testing facilities through NSIC<\/li>\r\n
- Subsidy on ISO Certifications<\/li>\r\n
- Subsidy on NSIC Performance and Credit ratings<\/li>\r\n
- Participation in Government Purchase registrations<\/li>\r\n
- Registration with NSIC<\/li>\r\n
- Concession in electricity bills<\/li>\r\n
- Reservation policies relating to manufacturing \/ production sector enterprises<\/li>\r\n
- Reimbursement of expenses for taking ISO Certification<\/li>\r\n
- Excise Exemption Scheme<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n
Classification of Micro, Medium and Small Enterprises<\/strong><\/h3>\r\n
According to the MSME Act, 2006, MSMEs have been broadly classified in two categories:<\/p>\r\n\r\n\r\n\r\n
\r\n![\"Classification](\"https:\/\/legalwindow.in\/wp-content\/uploads\/Add-a-subheading-2.png\" "\\"Classification")
<\/figure>\r\n<\/div>\r\n\r\n\r\n\r\n- \r\n
- Manufacturing Enterprises: <\/strong>Such Enterprises are involved in Manufacturing activities<\/li>\r\n
- Service Enterprises: <\/strong>Such Enterprises are involved in providing services to other industries.<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n
Eligibility for MSME Registration<\/strong><\/h3>\r\n
Recently, under Aatmanirbhar Bharat Abhiyaan, the government has revised the MSME Classification and the difference between manufacturing and services enterprises has been eliminated. They can be defined in terms of investment and annual turnover in Plant and Machinery\/ Equipment as below:<\/p>\r\n\r\n\r\n\r\n
- \r\n
- MICRO ENTERPRISES<\/strong>
These are the smallest entities and investment allowed for manufacturing enterprise and service enterprise is less than 1 crore and annual turnover of less than Rs. 5 crore.<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n- \r\n
- SMALL ENTERPRISE<\/strong>
Under these category of enterprises, Investment allowed is between 1 crore and 10 crore with annual turnover ranging between Rs. 5 crore to Rs. 50 crore<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n- \r\n
- MEDIUM ENTERPRISE<\/strong>
Medium enterprise allows investment in between 10 crores to 20 crores and annual turnover ranging between between 50 crores to 100 crores.<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n\r\n\r\n\r\n
\r\n Type of MSME<\/strong><\/td>\r\n Micro<\/strong><\/td>\r\n Small<\/strong><\/td>\r\n Medium<\/strong><\/td>\r\n<\/tr>\r\n \r\n Manufacturing Enterprises and Service Enterprises, both<\/strong><\/td>\r\n Investment Amount<\/span><\/u> – <\/strong>Less than Rs. 1 crore Annual Turnover –<\/u><\/strong> Less than Rs. 5 crore<\/td>\r\n Investment Amount<\/u><\/strong> –<\/strong> Rs. 1crore to Rs. 10 crore Annual Turnover –<\/u><\/strong> Rs. 5 crore to 50 crore<\/td>\r\n Investment Amount <\/u><\/strong>–<\/strong> Rs. 10 crore to Rs. 20 crore Annual Turnover<\/u><\/strong> – Rs. 50 crore to Rs. 100 crore<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<\/figure>\r\n\r\n\r\n\r\n Facilities to MSME\u2019s<\/strong><\/h3>\r\n
There are numerous facilities which are provided to MSME\u2019s under State and Central Government. They are as follows:<\/p>\r\n
- \r\n
- Facilities under Central Government<\/strong>\r\n
- \r\n
- Easy Sanction of bank Loans (Priority Sector)<\/li>\r\n
- Lower Rates of Interest<\/li>\r\n
- Excise Exemption Scheme<\/li>\r\n
- Exemption under Tax Laws<\/li>\r\n
- Statutory Support such as reservation and Zero Interest on delayed payments.<\/li>\r\n<\/ul>\r\n<\/li>\r\n
- Facilities under State Government<\/strong>\r\n
- \r\n
- Specialized Departments for MSME<\/li>\r\n
- Development of specialized industrial estate<\/li>\r\n
- Tax Subsidies<\/li>\r\n
- Power Tariff Subsidies<\/li>\r\n
- Capital Investment Subsidies<\/li>\r\n<\/ul>\r\n<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n
Checklist<\/strong><\/h3>\r\n
Before applying for MSME Registration, you must have a proper registered undertaking. Registration will be processed further only if your enterprise falls in any of the following categories:<\/p>\r\n
- \r\n
- Sole Proprietor,or<\/li>\r\n
- Association or a group of persons, or<\/li>\r\n
- Co-operative Society, or<\/li>\r\n
- Hindu Undivided Family, or<\/li>\r\n
- Partnership Firm, or<\/li>\r\n
- One-person company, or<\/li>\r\n
- Limited liability partnership, or<\/li>\r\n
- Private limited company, or<\/li>\r\n
- Producer Company<\/li>\r\n
- Or any other undertaking<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n
Documents required for MSME Registration<\/strong><\/h3>\r\n
Following important documents are required for MSME Registration:<\/p>\r\n
- \r\n
- Basic Details\/Documents<\/strong>\r\n
- \r\n
- Aadhar Number<\/li>\r\n
- PAN<\/li>\r\n
- Account Number with IFSC Code<\/li>\r\n
- NIC Code<\/li>\r\n
- List of number of employees<\/li>\r\n
- Expected date of commencement of business<\/li>\r\n<\/ul>\r\n<\/li>\r\n
- Other Documents:<\/strong>\r\n
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- Address proof of the business<\/li>\r\n
- Copy of Industrial License<\/li>\r\n
- Bills and receipts on purchase of machinery<\/li>\r\n
- Sales and Purchases Bill<\/li>\r\n<\/ul>\r\n<\/li>\r\n
- Documents in case of Unregistered and Registered Partnership Firm<\/strong>\r\n
- \r\n
- Unregistered Partnership Firm<\/strong> – Partnership Deed<\/li>\r\n
- Registered Partnership Firm<\/strong> – Registration Certificate<\/li>\r\n<\/ul>\r\n<\/li>\r\n
- Documents in case of company<\/strong>\/LLP<\/strong>
The following documents are required in case of a company\r\n- \r\n
- Memorandum of Association (MOA) of Company<\/li>\r\n
- Articles of Association (AOA) of Company<\/li>\r\n
- Certificate of Incorporation of Company\/LLP<\/li>\r\n
- A copy of the resolution passed in general meeting of the company<\/li>\r\n
- A copy of board resolution authorizing a director to sign the application of MSME .<\/li>\r\n<\/ul>\r\n<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n
Process of MSME Registration in India<\/strong><\/h3>\r\n
The procedure of MSME registration is quite simple and an online process which can be done in few minutes. Follow the step by step process of MSME Registration:<\/p>\r\n\r\n\r\n\r\n
![\"Process](\"https:\/\/legalwindow.in\/wp-content\/uploads\/Process-of-Trademark-Registration-in-India-51-1024x538.png\" "\\"Process")
<\/figure>\r\n\r\n\r\n\r\n
- Registered Partnership Firm<\/strong> – Registration Certificate<\/li>\r\n<\/ul>\r\n<\/li>\r\n
- Unregistered Partnership Firm<\/strong> – Partnership Deed<\/li>\r\n
- Basic Details\/Documents<\/strong>\r\n
- Facilities under Central Government<\/strong>\r\n
- MEDIUM ENTERPRISE<\/strong>
- SMALL ENTERPRISE<\/strong>
- Service Enterprises: <\/strong>Such Enterprises are involved in providing services to other industries.<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n
- Manufacturing Enterprises: <\/strong>Such Enterprises are involved in Manufacturing activities<\/li>\r\n
- Sources of Finance for MSME\u2019s<\/a><\/li>\r\n
![\"MSME](\"https:\/\/legalwindow.in\/wp-content\/uploads\/Msme-image.jpg\")
<\/a><\/p>\r\n\r\n\r\n\r\n