MSME Registration in India by Online XBRL

While acquiring MSME Registration in India is not required, it should be noted that entities or organizations with MSME Registration are entitled to partake in numerous schemes and advantages established by the Government. MSME Registration is obtained following the MSMED Act 2006.

MSME stands for Micro, Small and Medium Enterprises. It was a term introduced by the Government of India through the agreement with Micro, Small and Medium Enterprises Development (Act), 2006.

The Ministry of Micro, Small and Medium Enterprises has issued a notification dated 26th June 2020 regarding revising the definition of MSMEs and process registration. Apart from the old criteria of classification of MSMEs based on investment in Plant and Machinery / Equipment, an additional criterion of turnover has been included.

On Wednesday, delivering the economic package, part of the Aatma nirbhar Bharat Abhiyaan, FM Nirmala Sitharaman, announced revisions in the definition of Micro, Small and Medium Enterprises (MSME). Earlier, MSMEs were defined based on investments, but from now, turnover will also be included in the company's definition.

FM Sitharaman stated that there would be no more difference between Manufacturing and Service MSMEs.

“Earlier, the criteria for manufacturing units and service units were different. Now those distinctions between Manufacturing and Service MSMEs are being removed. They will all be defined similarly,” she said.

Existing and Revised Definition of MSMEs

Existing MSME Classification
Criteria: Investment in Plant & Machinery or Equipment
Classification	Micro	Small	Medium
Manufacturing Enterprises	Investment < INR. 25 lakhs	Investment < INR. 5 crore	Investment < INR. 10 crore
Services Enterprise	Investment < INR. 10 lakhs	Investment < INR. 2 crore	Investment < INR. 5 crore

New MSME Classification
Criteria: Investment and Annual Turnover
Classification	Micro	Small	Medium
Manufacturing & Services	Investment < INR. 1 crore OR Turnover < INR. 5 crore	Investment < INR. 10 crore OR Turnover < INR. 50 crore	Investment < INR. 20 crore OR Turnover < INR. 100 crore

Benefits of MSME Registration

1. Udyam/MSME Registration has many benefits: availing Government benefits/ MSME/ Subsidies/ Low-Interest Loans/ Collateral Free Loans, etc., just registering under the new Udyam scheme. Ex- Direct tax laws rules exemption, Patent registration subsidy, Interest rate Subsidy on Bank loans, Collateral free loans from banks, Ease of obtaining registrations, licenses and approvals etc.
2. There will be no need for renewal of the Registration
3. Registration procedure is all digitized and based on self-declaration
4. Any number of activities, including manufacturing, service, or both, may be added to one Registration.
5. Less paperwork and less cumbersome procedure
6. Far from the regular Minimum Alternate Tax (MAT) period of 10 years for credit, MSMEs are enabled to move further this limit to 15 years for credit against MAT.

Requirement for MSME Registration

1.Only Aadhar Number is required

In case of Proprietorship	Aadhar of Proprietor
In case of Partnership firm	Aadhar of managing partner
In case of Hindu Undivided Family (HUF)	Aadhar of Karta
In case of Company/ Limited Liability Partnership/ Cooperative Society/ Society/ Trust	Aadhar of Authorized Signatory

Having PAN & GST Number is mandatory from 01.04.2021

Procedure for MSME Registration:

Note:
Every organization or person having EM-II or UAM registration or any other registration issued by any authority under the Ministry of MSME will have to re-register.
An enterprise cannot file more than one Udyam Registration.

A. For Registering As A New Entrepreneur

1. New entrepreneurs will click on the option “For New Entrepreneurs who are not Registered yet as MSME or those with EM-II,” as shown on the home page.
2. After clicking “For New Entrepreneurs who are not Registered as MSME or those with EM-II,” a registration page opens.
3. After that person needs to enter the Aadhar number and name of the enterprise in the box provided and click “Validate & Generate OTP.”
4. After clicking the validate button, PAN card details are to be filled in, and after verification of PAN and filling in all asked udyam registration details, Registration will be completed.

B. For Those Who Already Have registered

1. For those already having UAM registration and want to migrate to Udyam or Re-Register UAM, click the button “For those already having registration as or “For those already having registration as UAM through Assisted filing.”
2. For those already registered, click on “For those already having registration as EM-II or UAM” or “For those already having registration as UAM through Assisted filing,” as shown on the home page.
3. After clicking “For those already having registration as EM-II or UAM” or “For those already having registration as UAM through Assisted filing,” a registration page opens.
4. After that person needs to enter Udyog Aadhar number and select the OTP option. Option to obtain OTP on mobile or email. And then click on “Validate & Generate OTP”.
5. After clicking the validate button, fill in all udyam registration details, and Registration will be completed.

Post MSME Registration Process

1. A permanent registration will be allotted after Registration
2. After completion of the Registration, a fresh registration certificate will be allotted, which can be downloaded by clicking on “Print/Verify,” or you can also print the certificate by clicking on “Print Udyam Registration Certificate,” as shown on the home page.

Penalty in case of misrepresentation of facts :
Penalty in case of misrepresentation or attempting to suppress the facts and figures shall be punishable :

In case of 1st Conviction	Fine upto Rs. 1000/-
In case of 2nd or subsequent Conviction	Min – Rs. 1000/- Max – Rs. 10,000/-