What is the Registration of MSME?

Any company that comes under the category of MSME needs to ensure they are registered under the MSME category. MSME registration stands for the Micro Small and Medium Enterprises registration. MSME Act has been launched by the government of India to support the MSME through various schemes, subsidies, and incentives. With MSME Registration, banks also provide the loans at lower rate of interests, as these MSME play an important role in the country’s economic growth.

What Businesses are Categorized Under the  MSME Scheme?

 
MSME are classified into two categories:

i. Manufacturing enterprises; and

ii. Service enterprises.

They are defined in term of investment in Plant and Machinery/Equipment  as below:

	MICRO	SMALL	MEDIUM
Manufacturing Enterprises	Less than ₹ 25 lakhs	Between ₹ 25 lakhs and ₹ 5 crores	Between ₹ 5 crores and ₹ 10 crores
Service Enterprises	Less than ₹ 10 lakhs	More than ₹ 10 lakhs but less than ₹ 2 crores	More than ₹ 2 crores but less than ₹ 5 crores

 

Benefits of MSME Registration

1.   Due to the MSME Registration​, the bank loans become cheaper as the interest rate is very low around - 1 to 1.5%. Much lower than interest on regular loans.

2.   There are various tax rebates offered to MSME.

3.   It also allowed credit for Minimum Alternate Tax (MAT) to be carried forward for up to 15 years instead of 10 years

4.   There are many government tenders which are only open to the MSME Industries.

5.   They get easy access to credit.

6.   Once registered the cost getting a patent done, or the cost of setting up the industry reduces as many rebates and concessions are available.

7.   Business registered under MSME are given higher preference for government license and certification.

8.   There is a One Time Settlement Fee for non-paid amounts of MSME.

Documents Required for MSME Registration

• Business Address Proof
  
• Copies of Sale Bill and Purchase Bill
  
• Partnership Deed/MOA and AOA
  
• Copy of Licenses and Bills of Machinery Purchased
  

Business Address Proof:

Self-owned premises: Possession letter, allotment letter, property tax receipt, or lease deed. If a municipal license exists in the name of the business or its proprietor, partner, or director, then no other possession document will be required.

Rented premises: Rent receipt, NOC from landlord, and utility bill or its equivalent as evidence to landlord’s ownership.

Copies of Sale Bill and Purchase Bill:

Business is required to submit a copy of sale bill related to each end product that it will supply. Also, for each raw material that it will purchase, a purchase bill has to be submitted.

Partnership Deed/ MOA and AOA:

If the business is a partnership firm, it has to submit its partnership deed. If the partnership firm is registered, it has to submit registration certificate also.

In case of a company, a copy of Memorandum of Association and Articles of Association, and certificate of incorporation has to be submitted. With it, a copy of the resolution passed in general meeting, and the copy of board resolution authorizing a director to sign the MSME application is also to be submitted.    

Copy of Licenses and Bills of Machinery Purchased:

In few cases, the applicant has to submit a copy of industrial license which is to be obtained by giving an application to Govt. of India. Further, all bills and receipts related to purchase and installation of plant and machinery have to be kept safe and required to be submitted on demand.

Registration Process

To do the registration the small and medium scale industry owner has to fill a single form which he can do online as well as offline.

Online Registration: The Ministry of MSME came up with a one page Udyog Aadhaar form which can be filled online.

Step 1: Go to Udyog Aadhaar homepage

Step 2: Enter the individual Aadhaar number of applicant in case of a partnership. In case of a company, the Aadhaar number of the authorized signatory applicant should be given.

Step 3: On submitting the form, you will receive an OTP on the registered mobile number linked with the Aadhaar card. Enter that OTP and proceed further to filling the form.

Step 4: You will need the personal information of the applicant while filling the Udyog Aadhaar form. These may include – Aadhaar number, name of owner (and then click on ‘Validate Aadhaar’), social category, gender, physical fitness, name of enterprise, type of organization, date of business commencement, PAN number, location of plant, previous registrations, Bank Account details, major area of business activity, NIC code, number of employees, investment in machinery/equipment. DIC, etc.

Step 5: Upon filling on the details, check the form for any mistakes and click on ‘Submit’

Step 6: You will then receive an OTP on your registered mobile number which you will be asked to enter.

Step 7: Then enter the code on the screen for final submission of the form and your online registration will be complete.

Offline Registration: The Udyog Aadhaar registration can also be done offline by following the steps below:

Step 1:   Apply for an Aadhaar card if you don’t have one.

Step 2: Until reception of your Aadhaar card, the Udyog Aadhaar application will be made to the District  Industry Center (DIC) or MSME-DI.

Step 3: You will be required to submit the following documents to DIC or MSME-DI: Aadhaar Enrollment ID slip or a copy of its request made for enrollment center, and any valid address proof.

Step 4:  Fill out the physical form carefully.

Step 5: Submit the duly filled form to DIC or MSME-DI, and your registration will be complete.

 

FAQ

Who can apply for Udyog Aadhaar Registration?

Any individual having a valid Aadhaar card can apply for Udyog Aadhaar Registration of their Firm/Company/Organization.

Is MSME updated to Udyog Aadhar?

Yes, MSME registration has been replaced with the Udyog Aadhar registration. If any micro, small and medium industries want to start any business; they need to do the registration with MSME/Udyog Aadhar. This registration with MSME/Udyog Aadhar can be done in two ways online and offline. This facility provides the business with a lot of benefits and subsidies.

Do I need multiple registrations for manufacturing plants in different cities?

No. The MSME/Udyog Aadhar certificate is for a single entity irrespective of multiple branches or plants. However, information about multiple branches or plants must be furnished.

What is the difference between MSME and Udyog Aadhaar?

Well, MSME registration and Udyog Aadhar Registration both are similar but different. Udyog Aadhar is just an easy way of acquiring MSME Registration.

Udyog Aadhar Registration is an online method by which an MSME can get the 12-digit Udyog Aadhar Number. And, later go for MSME registration. Therefore, one can say that both are different. But Udyog Aadhar registration is the new way of getting MSME registration.