MSME Registration0 ( 0 reviews )
MSME (Micro Small & Medium Enterprises) plays a very important role in the economy. Such enterprises provide support to the industries through raw material supply and supply of goods & finished product. In India, MSMEs are classified in terms of investment made in plant & machinery and equipment.
Brief Explanation on Classification of MSME in India on the basis of investment -
Investment made in Plant & Machinery
- Micro Enterprise- An entity which invest less than Rs. 25lakhs in plant and machinery
- Small Enterprise- An entity which invest between Rs. 25lakhs to Rs. 5crores in plant and machinery
- Medium Enterprise- An entity which invest between Rs. 5crores to Rs. 10crores in plant & machinery
Investment made in Equipment
- Micro Enterprise- An entity which invest less than Rs. 10lakhs
- Small enterprises- An entity which invest more than Rs. 10lakhs but less than Rs. 2 crores.
- Medium Enterprise- An entity which invest more than Rs. 2 crores but less than Rs. 5 crores.
What is MSME Registration?
Recently Government of India has introduced various schemes, subsidies, and incentives to promote MSME (Micro, Small and Medium Enterprises) through MSMED act. Not only the government but banks are also providing loans to these MSMEs at very concessional rates to set their first brick of the business. However, to get these benefits from the central and the state government or the banking sector, you would have to apply for MSME Registration. The Government of India has made it compulsory to have an Aadhar Number for Registration under the MSME act. For MSME, an application will be filed online using the official website of Udyog Aadhar Registration at Udyog Aadhar Website and this can be verified using the Aadhar OTP.
It's is playing a very crucial role across the nation for small and medium enterprises. It has been observed from various surveys that the economic growth of the country not only depends upon large scale enterprises but also on small sector enterprises operating in India. It is the backbone of such country whose economy is depends upon agriculture. India has huge stock of natural resources therefore the growth of small scale industries is certain. In the year 2015, government changed MSME registration into Udyog Aadhar Registration.
What is the Importance of MSME Registration for Small Scale Industries?
For the transparency and accountability of small scale industries, MSME registration is very important. To promote the MSMEs throughout the country there is a MSME department which is an authorized body established by the government. With registration one can avail numerous incentives as per MSMED Act. It is mandatory in order to subscribe under MSME.
What are the Advantages of MSME / SSI Registration?
The micro, small and medium enterprises in the manufacturing sector and the service sector can obtain MSME Registration. It is not mandatory to obtain but quite beneficial for certain businesses as it provides several benefits like:-
- Lower Rates of Interest on the loan
- Tax Subsidy
- Excise Duty Exemption schemes
- Subsidy tariffs
- Also capital investments subsidy etc and other supports.
- collateral free loans from the banks
- Reservation policies for the manufacturing sector and production sector
- Special consideration for the international trade fairs
- Eligible for IPS subsidy
- Reimbursement of ISO certification
What are the Several other benefits / schemes of MSME in India?
Once MSME registration/SSI Registration is obtained, you will be eligible Central and State Government schemes. Government subsidies and bank loans are the prime benefits of MSME registration/SSI Registration.
Detailed benefits of MSME Registration
Easily avail Bank Loans
Once registration is done by the enterprises they can avail the benefit of bank loans. Banks offer collateral free loans even property is not pledge with the Banks. Government of India and SIDBI work directly to implement the schemes on the MSMEs.
Ease in an opening bank account
Registration Certificate is a legal entity proof of the business therefore bank account can be easily opened and easily apply for any other license such as GST registration.
International Trade Fairs Participation
In order to expand the business across the country or internationally, enterprises can participate in international/national trade fairs organized by the MSME Department.
Government provides benefit of the refund of the octroi imposed on the goods and services, however without MSME registration; enterprises have to pay the octroi on the goods and services.
Waiving off Stamp Duty and Registration Charges
Prior to this, only such enterprises which expand their business in the IT Park or SEZ could avail the stamp duty benefits however now MSMEs can also avail these benefits.
Exemption under the Income Tax
Enterprises which are working towards the improvement of society can take the income tax benefits in the initial years. Recently government has introduced some benefits under the startup India scheme.
Reimbursement under the Bar Code Registration
Bar Code registration is required by the manufacturing units. Under this, one can avail the benefit of subsidy under the bar code registration.
NSIC and Credit Rating
Through NSIC Performance, small enterprise can avail the subsidy benefits on various expenses.
Industrial Promotion Subsidy
This subsidy is provided by the government to industrially promote the small enterprise.
Protection in case of Delay
Under this, enterprises can file case against the buyer & dispute settlement in the short span of time.
Lower Rate of the Interest by the Banks
Bank Policy for the MSMEs regarding the bank loan is as follows –
1. 40% of the total advances of banks must be for the following MSMEs
a. For manufacturing enterprises
Investment in plant and machinery up to Rs.10 lakh and
b. For service enterprises
Investment in equipment up to Rs.4 lakh
2. 20% of the total advances of banks must be for the following MSMEs
a. For manufacturing enterprises
Investment in plant and machinery above Rs.10 lakh till Rs.25 lakh investment
b. For service enterprises
Investments in equipment above Rs.4 lakhs
To purchase the plan & machinery, all the enterprise get the 15% capital subsidy.
Electricity Bills Concession
Under this, there will be a concession in the electricity bills for the enterprises having MSME registration certificate.
ISO Certification Benefit
Under this scheme, enterprise is eligible for subsidy for the ISO Certification.
Preference in the Government Tenders
There will be a preference in the government tenders for the enterprises having MSME registration/SSI Registration certificate.
Subsidy on the Patent Registration
For all such MSME firms who want protection for their innovation will get 50% waived off in the patent government registration fee.
What is the Eligibility Criterion for MSME / SSI Registration?
You can apply for registration if you fulfill one or multiple of the below mentioned criteria, such as if:-
- You are a sole proprietor (exclusive owner of a business)
- You belong to or are part of Hindu Undivided Family
- You work as or have a partnership firm with another party in an association
- You have a one person company
- You have a limited liability partnership
- You have a private limited company
- You have a production company that produces materials
- You work in an association with other persons
- You have co-operative societies
- Or any other undertaking
What are the Documents Required for MSME Registration?
The next step is to collect document for registration.
Hence, the following are the required documents for registration-
- PAN Card of the proprietor/ all the partners/all the directors
- Aadhar Card of the proprietor/all the partners/all the directors
- Proof of ownership of premises such as allotment letter/possession letter/lease agreement/property tax receipt.
- If rented premises then rent agreement and NOC from the landlord along with the utility bill
- Copy of sale bill for each end product
- Copy of purchase bill of each raw material purchased
- Copy of Partnership Deed in case of partnership firm
- Copy of Memorandum and Articles of association and certificate of incorporation in case of Private Limited Company Registration along with the Board's Resolution authorizing the director to sign the application
- Copy of Industrial License as obtained under Industrial Development and Regulation Act,1951
- An affidavit on Rs. 10/-non judicial stamp paper duly attested by Notary Public affixed providing the status of machinery installed, power requirement etc.
- Purchase bill of machinery installed
- Bills in relation to purchasing and installation of plant and machinery
- Bank Account Statement
Is it Compulsory to apply for MSME Registration?
MSME Registration Process is completely online subsequently you need a professional to fill up your application for MSME and obtain approval from the MSME department because many of us are not aware of the latest rules and regulation of the government regarding MSME.
Moreover, each state has a separate department to approve the MSME Registration Certificate with the MSME Number. It is not mandatory to obtain SSI registration but there are certain benefits that you can avail if you apply for Registration.
As per the Notification released on 07th February 2018, MSME / SSI registration can be obtained by the manufacturing enterprises complying with following conditions-
- Micro Enterprise – whose annual turnover does not exceed Rs 5 crores
- Small enterprise- whose annual turnover is in between Rs 5 Crores to Rs 75 Crores
- Medium Enterprise- whose annual turnover is in between Rs 75 Crores to Rs 250crores
Note: This is a proposed classification
It is completely voluntary to obtain, thus it can be availed for acquiring all the benefits and subsidies offered by the government. MSME / SSI Registration contribute to the economic growth of the nation. Before heading straight for the registration, what you can do is to first go with the provisional SSI registration certificate.
With the help of SSI Registration certificate, you can avail term loans and capital. You must apply for SSI Registration online as there are numerous benefits provided by the Indian government for achieving the economic growth at a faster pace and with MSME registration / SSI registration you will get easy credit and subsidies along with tax rebates and exemptions.
Who has the Authority for Registration of MSME?
For MSME online Registration there is a separate DIC (District Industries Centre) department in each state. They have the power to issue MSME Registration Certificate with the MSME Number. Even for availing the scheme or benefits, enterprise have to contact nearby DIC Department.
What is the Procedure of MSME / SSI Registration?
The MSME registration / SSI registration can be canceled anytime if it exceeds the prescribed amount of turnover or investment by the government.
MSME Registration process is completely an online process and for this you have to fill an application form with the help of professional and obtain the approval from the department. It is not mandatory for the companies however it is always preferred to obtain. The process of MSME registration is described below:
- As per the rules & regulations, its registration requires filing of an application with the respective government department.
- In application, an applicant has to provide the details of the industry they want to run along with the necessary details and documents:
- Aadhaar Number of applicant
- Details of an applicant such as name, gender, PAN number, email ID and mobile number
- Details of Enterprise such as type of the organization, PAN of organization, location of setting up a plant, address of the organization, date of the commencement of the business, number of employees
- Bank Account Number and IFS Code
- Primary Business Activity of the enterprise
- NIC 2 Digit Code
- Investment in Plant & Machinery / Equipment
For the completion of all the documentation for MSME registration, process takes around 2-3 working days. All the necessary formalities must be completed to avoid any future difficulty and to complete the process in hassle free manner.
How LocalVyapar will Process Your Application for MSME Registration?
LocalVyapar can help you with MSME registration. We offer all type of legal services all over the India and across the world.
For MSME Registration in India from LocalVyapar, you have to go through the following steps:
- You just have to visit our website LocalVyapar.com and fill your basic details like name, Email Id & Mobile No – Click on Get Started button.
- Then we request you to wait for a Call back by a consultant alternatively if you are in hurry then you can directly make the payment and start the process if you are clear about the MSME Registration process.
- Our team of experts will call you back in 4 to 8 Working hours and after that, if you will have any further query, then a professional from our senior management will speak with you on Skype. You can also drop an email.
- LocalVyapar will share a detailed checklist of documents required from your end for further action.
- We will assign you a unique order Number to track the progress of the assignment.
- You can also upload documents by using Mobile application of LocalVyapar which is available on Google play store for Android users and the Apple App Store for ios users. You can also email your documents.
- We will assign your order to our team.
- You can track the status of your order on our website or by using Mobile App.
- We will send regular updates via email about the work progress.
- Our team will handle end to end processes like a collection of all the documents required and filing of an application for MSME registration with the appropriate government authority.
- For tracking the status of your order you can write us on email@example.com and for Feedbacks/Complaints write to firstname.lastname@example.org
Why Choose us for MSME Registration?
- LocalVyapar has a team of experienced and qualified professionals.
- We offer best services on relevant fees.
- No hidden charges.
- Client satisfaction is our priority.
- We will give you an end to end assistance.
What are the Recent Changes in MSME Sector?
To support MSME sector in India, government of India takes timely initiatives. Recently government introduced the fastrack loan approval facility for MSMEs. Now MSMEs can obtain in-principal approval for loan up to Rs. 1 crore within 59 minutes.
LocalVyapar is a leading platform which cares about every client. We provide various legal services which helps client in carrying out its activities such as FSSAI registration, business plan, other government registrations and IEC registration in case client intend to carry out import export activities.