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Udyam Registration in India or MSME Registration or SSI registration is a certificate that is provided to micro, small, and medium-sized businesses in India under the MSME Act, 2006
What is Udyam Registration?
Udyam Registration in India or MSME Registration or SSI registration is a certificate that is provided to micro, small, and medium-sized businesses in India under the MSME Act, 2006. Udyam registration in India was earlier known as MSME registration. The primary objectives of the Micro, Small and Medium enterprises concerning the Udyam registration is as follows:
- To enable the Micro, Small and Medium enterprises on a large scale to effectively tackle the widespread problems of unemployment and poverty.
- To extend the benefits of various government schemes at one stop to the SSI units.
- To safeguard the SSI from financial harassment in the hands of the big industries.
To avail the benefits under the MSMED Act from Central or State Government and the Banking Sector, MSME Registration is required. MSME stands for micro, small and medium enterprises and any enterprise that falls under any of these three categories. Micro, Small and Medium Enterprises (MSME) sector has emerged as a highly vibrant and dynamic sector of the Indian economy over the last five decades.
On 13th may, 2020 Government of India announced some major relief to the MSMEs. And one of the major reliefs is that the Government Revised the definition of the MSME.
Under the new definitions, the distinction between manufacturing and services enterprises has been eliminated and the investments have been revised upwards and an additional criterion of turnover has been introduced.
Procedure for Udyam Registration Application
What is the procedure to obtain Udyam Registration?
To obtain Udyam registration following steps should be followed:
Documents Required for Udyam Registration
What are the documents required for Udyam Registration in India?
In case if the applicant or an authorized signatory does not have a valid Aadhar Card then the applicant must first apply for an Aadhar card at an Aadhar enrolment centre. Once the Aadhar is obtained the Udyam Registration can be initiated.
Details to be provided for obtaining Udyam Registration
- Aadhar Number (Mandatory)
- Name of the entrepreneur as mentioned in the Aadhar Card
- Mobile Number
- PAN Number (Pvt/ LLP/ Partner/ Company PAN number)
- Name of the enterprise
- Type of entity.
- Full Address of the Firm
- Account No
- Bank Name and Branch (Only the proprietor can use a savings account)
- Do you have GSTIN
- ITR details
- Physically handicapped
- Social Category
- Date of commencement of business
- Bank details of the Company or the personal (Current/ Savings)
- IFSC code
- NIC Code
- Specify the area (Urban or Rural)
- No of persons employed in the Company
- District Industry Centre
Benefits of Udyam Registration
What is the new & Revised definition of MSME?
Micro Enterprise: Manufacturing and services enterprises with investments up to Rs 1 crore and turnover up to Rs 5 crore will be classified as micro enterprises.
Small Enterprise: For small enterprises, the investment criteria and the turnover criteria has been revised upwards to Rs 10 crore and Rs 50 crore respectively.
Medium Enterprise: The enterprises which have investment up to Rs 20 crore and turnover up to Rs 100 crore will be termed as medium enterprises.
Eligibility for Udyam Registration
Who is eligible for Udyam registration in India?
Not all businesses require to obtain Udyam registration in India. The entities that are mentioned below that are classified as micro, small or medium enterprises based on the investment in plant and machinery are eligible for Udyam registration.
Classification of Enterprise
|Micro Enterprises||Up to Rs. 25 lakh investments in plant and machinery.|
|Small Enterprises||Up to Rs. 5 crore investments in plant and machinery.|
|Medium Enterprises||Up to Rs. 10 crore investments in plant and machinery.|
Becoming an Enterprise
- Any individual who is intending to establish a Micro, small or medium enterprise should get an Udyam registration in India.
- Once the registration is done an enterprise that is referred to as Udyam is assigned the permanent identification number that is known as the Udyam Registration Number
- An Udyam Registration Certificate is issued on completion of the registration process.
- All the units with the Goods and the Service Tax Identification Number (GSTIN) that are listed against the same Permanent Account Number (PAN) should be treated as one enterprise and turnover and the investment figures for all the entities should be seen together and only the aggregate values will be considered for deciding the category as a micro, small or medium enterprise.
Calculation of investment in plant and machinery
- The calculation of investment in plant and machinery or equipment is to be linked with the Income Tax Return for the previous years that is filed under the Income Tax Act,1961.
- In case of new enterprises where no ITR filing is available, the investment will be based on the self-declaration of the promoter of the enterprise and this relaxation will end after 31st March of the financial year in which the first ITR is filed.
- The expression “plant and machinery or equipment” of the enterprise shall have the same meaning as it is assigned to the plant and machinery in the Income Tax Rules,1962 are under the Income Tax Act,1961 and shall include the tangible assets which do not include the land and buildings, furniture and fittings.
- The invoice value of a plant and the machinery or the equipment whether it is purchased first-hand or second hand should be considered, and the GST should be excluded on a self-disclosure basis if in case the enterprise is newly formed without any ITR.
- The Cost of certain items that are specified in explanation I to the sub section of section 7 of the Act should be excluded from the calculation of the amount of the investment in plant and machinery.
Calculation of turnover
- Exports of the goods or services or both should be excluded while calculating the turnover of the enterprise be it micro, small, or medium for classification.
- Information concerning turnover and export turnover for an enterprise should be linked to the Income Tax Act or the CGST and the GSTIN.
- The turnover relevant to the figures of such enterprise which is not having a PAN will be considered on a self-declaration basis for a period up to 31st March 2021 and after. The PAN and GSTIN shall be mandatory.
Composite criteria of investment and turnover for classification
Composite criteria of investment and turnover should be applied for the classification of an enterprise as micro, small or medium.
If the enterprise is crossing the ceiling limits that are specified for the present category in either of the two criteria of investment or turnover, it will cease to exist in that category and will be placed in the next higher category, but no enterprise should be placed in the lower category unless it is going below the ceiling limits that are specified for the present category in both investment as well as turnover criteria.
All the units that have a valid GSTIN which is listed against the same PAN are to be collectively treated as one enterprise and the turnover and the investment figures of these entities should be seen together and only the aggregate values will be considered for deciding the category as a micro, small or medium enterprise.
FAQs On SSI MSME Registration
Any entrepreneur having valid Aadhaar Number can apply for MSME Registration Online.
Provisional registration is valid for a period of 2 years from the date of its Issue. In case Unit is not set up for two years, an applicant may apply afresh and obtain a new provisional registration. Permanent registration is granted for a lifetime.
It is computed as per the MSMED act and rules provided their under, but while computing the value of plant & machinery their original value is to be taken into consideration.
The SSI Registration is only needed to avail subsidies and benefits. It is voluntary. Due to the various benefits attached to it, it is advisable for SMEs to obtain the same.
A Micro, small and medium Enterprises can violate the regulations in the following ways which will make it liable for de-registration:
a) It crosses the investment limits.
b) It starts manufacturing any new item or items that require an industrial license or other kinds of statutory license.
c) It does not satisfy the condition of being owned, controlled or being a subsidiary of any other industrial undertaking.
In the interest of the environment, no physical copy of MSME Certificate will be issued. The government believes in paperless work.
At present, Aadhaar Number is mandatory for issuance of MSME Certificate.
Yes, you can very well do so by visiting Government website. It is free of cost.
For detailed narration, please visit here.
BizHub provides SSI/MSME Registration across India. You can obtain SSI/MSME registration in Ahmedabad, Mumbai, Pune, Bangalore, Chennai, Delhi, Kolkata, Kanpur, Nagpur, Jaipur or any other cities easily with us.
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