Business visionary look for a permit to get their company recognized by the government when they first start out. The msme registration online is one of the less difficult enlistment to obtain. Enterprise benefit from this registration in a variety of way.
What are the advantage of micro, small and medium enterprise registration?
There is no legal foundation for the registration intention. Enterprise frequently enlist in order to take advantage of specific benefit. The national as well as state government fund the motivating force. The following are some of the advantage provided by the federal government.
- Lending to priority sector at a lower interest rate.
- Exemption from excise.
- Direct tax exemption.
- Legal aid such as the interest on delayed payment act and the reservation act.
States and union territory provide their own set of facility and incentive for small enterprise. They recognize the potential for growth in these enterprise and offer various subsidy and sponsorship, as well as lower power tariff, capital investment rebate and other assistance. Both the center and the state whether by law and otherwise focus on their incentive and goal with package often given to unit enrolled with them.
What are the registration scheme key goal?
Maintain a steady pace and keep track of the small industry targeted for incentive.
To issue a certificate that allow organization to benefit from incentive mainly in term of security.
To assist in the gathering of data and statistic.
To assist in the formation of nodal focus at the national as well as state and local district level in order to progress small scale industry.
Eligibility for registration.
Micro enterprise. Micro manufacturing enterprise invest less than rupees 25 lakh in plant and machinery whereas micro service enterprise invest less than rupees 10 lakh in resource.
Small enterprise. Small manufacturing company may invest anywhere from rupees 25 lakh to rupees 5 crore in plant and equipment while small service company may invest anywhere from rupees 10 lakh to rupees 2 crore in hardware and equipment.
Medium enterprise. Medium manufacturing company may invest between rupees 5 crore and rupees 10 crore in plant and equipment whereas medium service company may invest between rupees 2 crore and rupees 5 crore in hardware and equipment.
Land and building on the other hand cannot be included in the total investment for manufacturing venture. The original cost of the hardware plant and machinery is also taken into account depreciation is not taken into account.
Any business whether a partnership corporation as well as single proprietorship can apply for this registration.
What is the registration procedure?
The following are the highlight of the current strategy.
For something that does not require industrial authorization a unit can apply for a permanent registration certificate. This include the item listed in schedule three as well as those not listed in schedule one as well as schedule two of the licensing exemption notification. Unit with fewer than 50 and 100 specialist with and without power are eligible to apply for registration for the item listed in schedule two.
Unit complete the approved application structure for a permanent registration certificate. There is no field investigation and the permanent registration certificate is issued.
The permanent registration certificate has a five year validity period. If the business visionary is unable to establish the unit within this time he may reapply at the end of the five year period.
The unit must apply for a permanent license on the approved form once it commence production.
The assessment is based on the following form.
The unit must get all necessary statutory as well as regulatory clearance. A drug license permit under the drug control order if necessary a no objection certificate from the pollution control board and so on.
At the time of assessment the unit does not damage any locational power constraint.
The plant and machinery estimation are within the prescribed range.
According to the notification the unit is not possessed, controlled and a backup of any other industrial venture.
Also read udyog aadhaar print.
What is the significance of a provisional registration certificate?
Because the provisional registration certificate expire at the end of five year you may reapply if the unit is not yet operating and if it exceed the micro, small and medium enterprise development act speculative restriction. You can apply for a permanent license once you begin manufacturing.
What are the factor that are not considered an investment?
For registration the total cost of plant and machinery for manufacturing firm should be up to rupees 25 crore, and for service based enterprise it should be up to rupees 10 crore.The cost of land and construction will not be factored into the total investment when calculating this figure. The original cost of the machinery and plant as well as equipment is also taken into account. Depreciation cannot be factored into the equation.
How does micro, small and medium enterprise assist in obtaining a bank loan?
Micro, small and medium enterprise are recognized by all banks and non banking financial corporation and they have unique plan in place for them. This usually include priority sector lending which mean that your firm has a high chance of being approved for a loan. Interest rate will also be cheaper. In the event of late payment special consideration may be given.