MSME / ssi Registration
The Government of India has enacted the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 in terms of which the definition of micro, small and medium enterprises is given below. A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 25 lakh, for micro service less than Rs. 10 lakh. A small enterprise is an enterprise where the investment in plant and machinery is more than Rs. 25 lakh but does not exceed Rs. 5 crore, for small service between Rs. 10 lakh to Rs 2 Crore.
A medium enterprise is an enterprise where the investment in plant and machinery is more than Rs.5 crore but does not exceed Rs.10 crore, for medium service between Rs 2 crore to Rs. 5 crore.
Types of MSME/SSI
MSME Registration in India, come under two categories on the basis of Investment in Equipment. These are further explained below:
1. MSME (Manufacturing)- Those Enterprises engaged in manufacture or production, processing or preservation of goods as specified here,
Type A: Micro Enterprise whose investment in plant and machinery does not exceed Rs. 25 lakh;
Type B: Small Enterprise is the one where the investment in plant and machinery is between Rs. 25 lakh and Rs. 5 crore;
Type C: Medium Enterprise where the investment in plant and machinery is over Rs. 5 crore but does not exceed Rs. 10 crore.
Here, the investment in plant and machinery means the original cost. It doesn’t include land and building or the items as specified by the Ministry of Small Scale Industries.
2. MSME (Services)- The Enterprises providing services and whose investment in equipment (original cost excluding land, building, furniture, fittings, and other items not directly related to the services rendered or as may be notified under the MSMED Act, are:
Type D: Micro Enterprise with the investment in equipment below Rs. 10 lakh;
Type E: Small Enterprise is where the investment in equipment ranges between Rs. 10 lakh to Rs. 2 crore;
Type F: Medium Enterprise is the one whose investment in equipment is over Rs. 2 crore but does not exceed Rs. 5 crore.
Those firms/shops/LLPs/public/private limited companies, corresponding to the above criteria, are also eligible to avail the Government subsidies to MSME.
The Objectives of MSME / SSI
1. MSME or SSI registration helps to count and maintain the role of the small businesses to which the package of incentives and support are targeted.
2. It provides a certificate for declaring that the registration under MSME and SSI will empower the enterprises to gain profit from the legal advantages that are offered by the government and also essentially, they will have the long-term protection.
3. It helps in fulfilling the use of the statistics collection.
4. MSME and SSI registration can be used as identification for businesses to open a bank account with the name of the business or the enterprise and also for registration of GST: https://www.gst.gov.in/.
Benefits of obtaining SSI Registration
SSI registration is not a mandatory requirement for a small business in India. However, businesses that have SSI registration can avail some benefits, incentives or support given either by the Central or State Government. Some of the incentives offered for SSI businesses include:
Priority sector lending in Banks
Reduction in bank loan interest rate
Excise exemption scheme
Exemption under direct tax laws
Statutory support such as reservation
Interest on Delayed Payments Act
In addition to the above-mentioned benefits provided by the Central Government, States Governments and Union Territories have implemented their own package of facilities and incentives for SSI units. Typical SSI benefits relate to the development of industrial estates, tax subsidies, power tariff subsidies, capital investment subsidies and other support. Both the Centre and the State Government subsidies aimed at small businesses are provided only to those businesses having SSI registration.
Documents Required for MSME Registration
To register your business under MSME, you have to submit the following documents
1. Business Address Proof
2. Copies of Sale Bill and Purchase Bill
3. Partnership Deed/ MoA and AoA
4. Copy of Licenses and Bills of Machinery Purchased
Business Address Proof of the entity: If the business premise is self-owned then you have to submit allotment letter, lease deed or property tax receipt and possession letter. If you have a municipal license in your business name or in the name of a partner or director or in the name of the proprietor of the business then no other possession document is needed to be submitted.
If the business premise is rented then you have to submit the rent receipt and a no-objection certificate from the owner of the premises. Also, any utility bill manifesting the landlord’s ownership is needed to be submitted.
Copies of Sale Bill and Purchase Bill: The entity is needed to submit a copy of the sale bill related to each end product of the business that it will supply. Also, for each and every raw material which is purchased, a purchase bill has to be presented.
Partnership Deed/ MoA and AoA: If the company is a partnership firm then it has to present its partnership deed. If the partnership firm is registered already then the registration certificate of the firm has to be submitted. If it is a company then a copy of Memorandum of Association and Articles of Association, and certificate of incorporation has to be presented during the MSME registration process. Apart from that, a copy of board resolution empowering a director to sign the MSME application and a copy of the resolution passed in general meeting is also to be submitted.
Copy of Licenses and Bills of Machinery Purchased: In a few cases, the applicant has to produce a copy of the industrial license from Govt. of India. Additionally, all receipts and bills related to purchase and installation of plant and machinery for your business have to be filed in the proper manner as it may require during the registration process.
Steps for MSME / SSI Registration online
1. Form fill-up for MSME/SSI Registration – You have initially fill-up the our MSME/SSI Registration form and submission of the basic answers.
2. MSME Application submission – Your MSME/SSI application along with the required document, after verification by our team, will submit.
3. Receipt of OTP – Provide us the OTP you receive on your mobile and email provided earlier.
4. Receive your Certificate – on successful validation. we will send you the MSME/SSI Certificate.
Conclusion
The MSME and SSI are both under Government of India. Earlier it was only SSI but then Government decided to include micro and medium enterprises into it and therefore the name is MSME now. The Indian MSME and SSI enterprises sector provides quiet a support to the national economy and by protecting it acts as a defense in case of recession, global economic shock and any other unprecedented adversities. Hence, it can be said that India through a silent revolution is growing forward towards a strong and powerful global economy powered by MSMEs.
Therefore, both MSME and SSI aim for the socio-economic development and growth of the Indian economy and works for the same cause.