MSME/SSI Registration In India 2022
A small scale industry (SSI) registration in india 2022 is the registration one gets from the Ministry of Micro, Small and Medium Enterprises. When a company/business/organization registers as a small scale industry (SSI), the said entity becomes eligible for government schemes and subsidies that are exclusively given to small business enterprises.
MEANING OF SSI/MSME REGISTRATION IN INDIA 2022
A small scale industry has always played an important role in the socio-economic development of India since independence. The government of India created the MSMED act for the promotion of small scale industries and to maintain a list of all industries registered as small scale industries (SSI) and micro, small and medium enterprises (MSME) in the country.
Maintaining such a list has helped the government of India to provide incentives to such SSI’s and MSME’s. SSI’s has always helped in providing employment to lakhs of people without requiring huge capital investments. Any such entity that falls under these category should get a certificate of MSME registration, which has to be registered with the Central Government’s MSME department under the Act of MSME Development – 2006.
The MSMED Act contains the following points:
1) Small Scale Industries (SSI).
2) Micro, Small and Medium Enterprises (MSME).
3) Different segments/sectors have different limits under which they can register under the MSMED act.
4) Any manufacturing unit with plant & machinery that requires an investment of under 10 Crores is categorized as a MSME. For a service enterprise to be categorized as a MSME, the investment amount has to under five crores. If any manufacturing unit/service enterprises exceeds these limits in the future, they are then not categorized as an MSME.
To be eligible for the numerous benefits offered by the Government of India, a SSI unit needs a SSI registration certificate. A SSI registration is an optional registration for a SSI company. But the advantages for registering a said company/unit under this registration are mentioned below:
a) They are charged lesser interest rates.
b) They fall under the excise exemption scheme.
c) They get subsidies in tax/capital investment and power tariffs.
d) They are also eligible to get other support from the government.
UDYOG AADHAAR REPLACES SSI / MSME REGISTRATION
To make the process of registration even simpler for a small/medium enterprise, a new Act called the Udyog Aadhaar was introduced in 2015 by the government of India. Udyog Aadhaar replaces MSME and the whole registration process can be conducted online. Under the Udyog Aadhaar registration an applicant needs to fill up just one page/or register with his/her Aadhaar Card which acts as the sole legal document. Mentioned below are the different MSME schemes which are offered under the Udyog Aadhaar.
- The Udyog Aadhaar Memorandum (UAM) was first introduced under the MSMED Act, 2006 to facilitate and promote the ease of doing business for MSMEs in India. A simple one-page form needs to be filed and the registration is extremely easy. The only documentation an applicant requires to register is their 12-digit Aadhaar card number. A business also has a provision to file for multiple Udyog Aadhaar with the same Aadhaar number. The UAM can easily be filed on a self-declaration basis.
2) Under The ZED scheme an exporter is encouraged to manufacture export goods that are of the highest quality and standards. If such standards are met during the export of goods then the said exporter is eligible for rebates and concessions offered under the ZED scheme. If such goods don’t meet the standards while being exported, then these goods are rejected and returned to India. The ZED scheme helps micro/small and medium enterprises produce high quality goods at competitive prices by adopting the tools under the scheme. The tools offered under the ZED scheme help a business optimize their resources/improve quality standards/ reduce the rate of rejection & rework. Under the ZED scheme a business is taught about these tools through different activities such as workshops/campaigns and seminars run by the government. The ZED scheme also addresses the various complaints and issues of the businesses registered under. An owner of a registered business can track the status of his/her complaint and challenge/question the outcome, if he/she is not satisfied with the decision.
BENEFITS OF UDYOG AADHAAR
If a business wants to avail the benefits of the MSMED Act of 2006 through banks, they should opt for MSME registration. When an individual registers his/her firm with Udyog Aadhaar they can leverage all the schemes initiated by the State and Central Government. The benefits offered under the MSMED Act 2006 are as follows:
- Banks refrain from asking for security deposits from registered MSME entities.
2) Concession is offered to a registered MSME in their monthly electricity bills.
3) Being registered increases the chances of a MSME getting a government tender.
4) There is a reduction in fee for a registered MSME for filing patents/trademark registration.
5) Bank loans offered by the major banks are easier to procure and are offered at lower interest rates for a registered MSME.
6) There are reservation benefits offered under the MSMED act for relevant beneficiaries.
7) The stamp duty and registration charges are waived off for a registered MSME.
8) Reimbursement is offered under the bar code registration for a registered MSME.
9) Industrial promotion subsidy is given to a registered MSME.
DIFFERENT TYPE OF MSME REGISTRATIONS
PROVISIONAL MSME REGISTRATION
The first type of MSME registration is a provisional one. This is offered before the establishment of the said entity/the pre-investment period of the firm. At this point, such a said entity qualifies to obtain facilities for accommodation/land, get important approvals and NOCs, get clearances from government bodies such as the Pollution Control Board and Labour Regulations. A provisional SSI Registration Certificate (PRC) helps small units get term loans/working capital from banks and financial institutions under priority sector lending.
PERMANENT MSME REGISTRATION
The second type of MSME registration is a permanent one. A permanent MSME registration is issued to industrial units/factories that are already functional.
GUIDELINES FOR ONLINE SSI / MSME REGISTRATION
Apply For Provisional Registration
A Provisional Registration Certificate (PRC) is issued to new entities without any kind of field enquiry. It is mainly an application-based form. Thus, such an application has to be submitted in the precise prescribed form before operations commence in the said unit. Once this application is filed and submitted, the provisional registration is provided without a physical inspection of the unit. The procedure is extremely quick and hassle free. This has been done so these new companies can get multiple benefits/quick loans and other necessary approvals that are required to get the business functioning.
COMMENCEMENT OF BUSINESS
A provisional registration certificate (PRC) is valid for a period of five years and the registered enterprise/entity must become operational within this period. If for some reason the business fails to commence work, then a new application must be submitted.
APPLICATION FOR PERMANENT SSI REGISTRATION
If a business manages to begin operations within five years, they are eligible for a permanent SSI registration issued by the Ministry of MSMEs. A permanent SSI registration is granted only if the below mentioned conditions are fulfilled.
a) The registered unit has got statutory and administrative clearances as required.
b) The registered unit has not violated any regulations or restrictions.
c) The monetary value of plant and machinery in the registered unit is not in excess of the prescribed limits.
d) Evidence has to be presented that the said registered enterprise is not owned/is a subsidiary/or owned by another entity.
Our team of experts at ACE ALLIANCE will assist you every step of the way during the MSME registration process and guide you with any problems that may arise during this process.
LIST OF DOCUMENTS REQUIRED FOR SSI / MSME REGISTRATION
Stated below are the list of documents one requires for SSI/MSME registration.
1) The address proof of the business.2) A copy of the sale/purchase bill.3) The original Partnership Deed/ MOA and AOA.4) A copy of the license and bills of the machinery that has been purchased.
For firms that are listed under Schedule-III of the Industrial Licensing Exemption Notification, no industrial license is required. Every other enterprise/unit must obtain a license to apply for the Provisional Registration Certificate(PRC). For the registration and document process, all statutory and administrative clearances such as a NOC from the pollution board have to obtained, to prove that no restrictions are being violated.
OPENING A CURRENT ACCOUNT
A current account/Demand Deposit Account has to be opened in a bank by the said business entity. Such an account is used to facilitate higher number of transactions daily which include deposits/withdrawals/contra transactions.
UDYOG AADHAAR ELIGIBILITY
The eligibility for this scheme of MSME/SSI registration depends on the scale of business of the enterprise. Udyog Aadhaar registration is applicable for Proprietorship/Hindu Undivided Family(HUF)/One-person enterprise(OPC)/ Public limited company/Private limited company/Production company/Co-operative societies/Limited liability partnership(LLP)/or any Association of persons(AOP)/or any other enterprise. The different types of enterprises are stated below.
A micro enterprise is a manufacturing enterprise that has an investment of less than Rs.25 lakhs in plant and machinery/or a service enterprise that has less than Rs.10 lakhs in investment.
A small enterprise is a manufacturing enterprise that has an investment between Rs.25 lakhs and Rs.5 crores in plant and machinery. For a service enterprise to fall under this category, the investment must be between Rs.10 lakhs and Rs.2 crores.
A medium enterprise is when a manufacturing enterprise has an investment in plant and machinery between Rs.5 crore and Rs.10 crores. For a service enterprise, the investment must be between Rs.2 crores to Rs.5 crores.
Our team of experts at ACE ALLIANCE will offer you all the help you need for MSME registration. Our team will offer free consultation, do a complete and thorough of all the documents you have submitted. Our team will help with the whole online process for SSI application till you receive the SSI certificate within a period of 15 days.