MSME / Udyam Registration

Micro, Small, and Medium Enterprises, coined as MSMEs, have come to become the Indian economy’s major pillar of foundation. The classification of these enterprises is as follows: -

i.) a micro enterprise, where the investment in Plant and Machinery or Equipment does not exceed 1 crore rupees and turnover does not exceed 5 crore rupees;
ii.) a small enterprise, where the investment in Plant and Machinery or Equipment does not exceed 10 crore rupees and turnover does not exceed 50 crore rupees;
iii.) a medium enterprise, where the investment in Plant and Machinery or Equipment does not exceed 50 crore rupees and turnover does not exceed 250 crore rupees.

MSMEs enable citizens of a nation to venture out on their own and in turn, give back to society by creating new jobs and diversifying an area’s gross domestic production(GDP). They have also slowly and steadily revived the artisan class in the far reaches of India by providing employment, and access to loans and other services to the said class. Furthermore, they constantly support the upgradation of technology, and infrastructure development, and trigger the modernization of the country and our society as a whole.

In order to help MSMEs, the government of India introduced the MSME (Amendment) Bill Of 2018 and re-emphasized the MSME ACT of 2006. Under these legislations, there would be no need for frequent inspections to check the required investments needed to be made in the plant and machinery needed. In addition, the operations of MSMEs would be allowed to continue in a transparent, non-discriminatory, and objective manner.

MSME registration is a mandatory process for any business to legally start functioning in India. The registration process is paperless, based on self-declaration, and is differentiated into two main categories, namely manufacturing enterprises and service enterprises. Businesses who want to avail of benefits announced by the Government for MSMEs will need to register their business on the ‘Udyog Aadhaar Memorandum (UAM) portal and provide the following documents:- Aadhar number PAN number Address of the business Bank account number The basic business activity NIC 2-digit code Investment details (Plant/equipment details) Turnover details (as per new MSME definition) Partnership deed Sales and purchase bill copies Copies of licenses and bills of purchased machinery