3 Sep 2019, 10:04 — 5 min read
In the previous article we talked about the definition of SME and benefits of registering yourself as a MSME.
MSMEs, as on date, need multiple registrations to avail different schemes. In this article, we will cover some of these registrations.
An Aadhaar based electronic platform and requires few basic entries including PAN details. As on August 22, 2019, 73.46 lakh MSMEs have registered through this system.
Udyog Aadhaar is a unique 12-digit identification number provided by the Ministry of MSME. Udyog Aadhaar is recommended for Sole Proprietors as it gives them a unique identification with Government of India that validates their registration as a business.
Also read: Online Udyog Aadhaar registration process
The benefits of having a Udyog Aadhaar is the same as you would get as an MSME gets mentioned in the previous article like:
To participate in public procurement, all MSME units are to be registered with NSIC. For all practical purpose, this registration is not accepted by most of the organizations.
MSMEs have to register separately with each organisation. For example --
MSMEs have to register with DQA for defence related procurement;
ONGC, Engineers India for Oil and Gas,
RDSO for Railways
This registration process is cumbersome, time consuming, leading to duplication of efforts and without this separate registration, MSMEs cannot participate in any tendering, primarily because NSIC registration is neither trusted nor accepted by these organizations.
Under GST, MSMEs are not defined as per the definition of MSMED Act, 2006 as it is not possible to ascertain the investment in plant and machinery/equipment in GST return. Hence, there is no mapping of MSME definition in the GSTN data. MSME units having turnover above ₹40 lakh are mandated to register under GSTN but most MSMEs fall below that threshold. Also, unit operating in multiple States can have multiple GSTN.
The Committee, felt, taking a long-term view to build an enabling environment for businesses in the country to grow based on their unique merits, that it is imperative to develop a ‘Unique Enterprise Identifier’ to identify all the entities across the country. UEI will enable tax compliance, delivery of service under various MSME schemes and provide seamless integration with financial institutions.
Finance Minister Nirmala Sitharaman, on August 23, 2019 declared amendment of the MSME Act, so as to ensure single definition for micro, small, medium enterprises under MSME Act. Minister for Micro, Small and Medium Enterprises (MSME) Nitin Gadkari also said that an amendment in the definition of this sector is under serious consideration.
Image source: shutterstock.com
To explore business opportunities, link with me by clicking on the 'Invite' button on my eBiz Card.
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views, official policy or position of GlobalLinker.
Posted byPrashant S Shetty
Catalyst for corporates seeking financial restructuring and fund raising
Recommended articles for you
By Amy Radin
5 Jul 2020, 11:00