Aug 062019

MSME Concepts

Meaning and definitions:

The Micro Small and Medium Enterprises have been defined under MSME Act, 2006. According to the Act, MSME have been broadly classified in two categories:

  1. Enterprises engaged in the manufacturing and production of goods pertaining to any industry;
  2. Enterprises engaged in providing or rendering services

(a) Manufacturing Enterprises- The enterprises engaged in the manufacture or production of goods pertaining to any industry specified in the first schedule to the industries (Development and Regulation) Act, 1951 and are defined in terms of investment in Plant & Machinery.

(b) Service Enterprises: The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment.

Sector Micro Small Medium
Manufacturing <= Rs 25 lacs <= Rs 5 Crore <= Rs 10 Crore
Service <= Rs 10 Lacs <= Rs 2 Crore <= Rs 5 Crore

Cost which are included from calculation of cost of plant and machinery:

  1. Equipment such as tools, jigs, dyes, moulds and spare parts for maintenance and the cost of consumables stores;
  2. Installation of plant and machinery;
  • Research and development equipment and pollution controlled equipment
  1. Power generation set and extra transformer installed by the enterprise as per regulations of the State Electricity Board;
  2. Bank charges and service charges paid to the NSIC or the SSIC;
  3. Procurement or installation of cables, wiring, bus bars, electrical control panels (not mounted on individual machines), oil circuit breakers or miniature circuit breakers which are necessarily to be used for providing electrical power to the plant and machinery or for safety measures;
  • Gas producer plants;
  • Transportation charges (excluding sales-tax or value added tax and excise duty) for indigenous machinery from the place of their manufacture to the site of the enterprise;
  1. Charges paid for technical know-how for erection of plant and machinery;
  2. Such storage tanks which store raw material and finished products and are not linked with the manufacturing process; and
  3. Firefighting equipment.

Objective Udyog Aadhar Memorandum (UAM):

The main purpose of Registration is to maintain statistics and maintain a roll of such units for the purposes of providing incentives and support services. The objectives of registration are as follows:

  1. To enumerate and maintain a roll of small industries to which the package of incentives and support are targeted.
  2. To provide a certificate enabling the units to avail statutory benefits mainly in terms of protection.
  3. To serve the purpose of collection of statistics.
  4. To create nodal centres at the Centre, State and District levels to promote SSI.

The other benefit available for MSME registration are as below:

  • Easy finance availability from Banks, without collateral requirement
  • Protection against delay in payment from Buyers and right of interest on delayed payment
  • Preference in procuring Government tenders
  • Stamp duty and Octroi benefits
  • Concession in electricity bills
  • Reservation policies to manufacturing / production sector enterprises
  • Time-bound resolution of disputes with Buyers through conciliation and arbitration
  • Reimbursement of ISO Certification Expenses
  • Credit prescription (Priority sector lending), differential rates of interest etc.
  • Excise Exemption Scheme
  • Exemption under Direct Tax Laws.
  • Financial Assistance for setting up testing facilities through NSIC
  • Statutory support such as reservation and the Interest on Delayed Payments Act.
  • Subsidy on ISO Certifications
  • Subsidy on NSIC Performance and Credit ratings
  • Participation in Government Purchase registrations
  • Registration with NSIC
  • Counter Guarantee from Government of India through CGSTI
  • Waiver in Earnest Money (Security Deposit ) in Government tenders
  • Stamp duty and Octroi benefits,
  • Weightage in price Preference.
  • Reduction in rate of Interest from banks (Subject to ratings)
  • Free of Cost Government tenders
Aug 052019

Due dates for the Month of August 2019
Income Tax
– TDS Payment for July
– Return for authorities deducting tax at source – GSTR 7 for July
– Details of supplies effected through e-commerce operator and the amount of tax collected –
GSTR 8 for July.
– Details of outward supplies of taxable goods and/or services effected – GSTR 1 for July
– Return for Input Service Distributor – GSTR 6 for July
Providend Fund
– PF Payment for July
– ESIC Payment for July
– Monthly return on the basis of finalisation of details of outward supplies and inward supplies along with the payment of amount of tax – GSTR 3B for July
– Return for Non-Resident foreign taxable person – GSTR 5 for July
– Details of Inward Supplies to be furnished by a person having UIN and claiming refund – GSTR 11 for July
– Annual Information Report for Previous Financial Year
Profession Tax
– Monthly Return (covering salary paid for the preceding month) (Tax Rs. 50,000 or more)
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