UDYAM/MSME REGISTRATION

 

Introduction

On July 1, 2020, the Union MSME Ministry established the Udyam Registration Portal. Both in terms of flexibility and features, the site has proven its worth. Currently, the platform has over 11 lakh registered MSMEs (Micro, Small and Medium Enterprises) who have completed their self-declaration registration process. This registration process was created by the Finance Minister as part of the Prime Minister's assistance package in the wake of the Covid 19 pandemic.

The former Udyog Aadhar / MSME Registration system has been replaced with a new system known as Udyam Registration, which is run by the Ministry of MSME.

The Ministry of Small, Medium, and Micro Enterprises has established a system through the MSME Act 2006 to assist small businesses in starting, maintaining, and growing. This technology permitted their registration through MSME Registration, and the database was widely used by the government mechanism to help small, medium, and micro companies across the country. To make the registration process easier, the ministry introduced Udyog Aadhar, which replaced the existing system of offline registration. It allowed MSMEs to register quickly and easily online using only their Aadhaar card information.

It was an instant hit with all MSMEs, and financial and allied institutions quickly obtained it to assist MSMEs in obtaining different benefits that were passed on to them.

 

With effect from July 1, 2020, the Ministry of Micro, Small and Medium Enterprises has phased out the previously used Udyog Aadhaar and MSME Registration systems in favour of a fully new Udyam Registration system. This transition from Udyog Aadhaar to Udyam Registration differs from the MSME Registration to Udyog Aadhaar transition.

Previously, when the old system was implemented, older MSME registrations remained valid; however, the Ministry of MSME has announced that all old Udyog Aadhar or MSME Registrations will remain invalid, and all MSMEs are hereby instructed to either migrate their older registration to the new Udyam Registration or obtain a new registration altogether.

By deploying a QR Code-based approach, the new system has embraced even more advanced digital authentication and verification processes. Every Registration document includes a unique QR Code that will be used by every Ministry of MSME channel partner to verify and report MSME information.

MSMEs will now be classified not only on the basis of investment value, but also on the basis of turnover under the new system. This is being done in order to promote and encourage MSMEs to become industry leaders. MSMEs who invest less but generate more revenue are recognised as CHAMPIONS and receive additional incentives over time.

 

Micro, Small, and Medium Enterprises are the three types of businesses that will be classified.

Microbusinesses

Businesses having a capital investment of up to Rs. 1 crore and a revenue of up to Rs. 5 crore.

Small businesses

Businesses having a starting capital of up to Rs.10 crore and a revenue of up to Rs. 50 crore.

Medium-sized businesses

Businesses that invest up to Rs.50 crore and a revenue of up to Rs. 250 crore.

The Ministry of MSME has also signed a Memorandum of Understanding with the CBDT, which will actively share data on investment and turnover reported at the time of submitting ITR, in order to verify information provided by applicants.

GST data is now exchanged and synchronised with the database of MSMEs in this new system, allowing for active categorization and provision of benefits.

Applicants have been told that they must furnish their PAN and GST details by April 1, 2021. To be eligible for scheme benefits, Udyamis would need to collect PAN and GST information from April 1, 2021.

The Udyam Registration scheme is primarily designed to collect data about MSMEs in India who seek to form a partnership with them in order to help them expand. At the time of receiving any benefits from the Ministry of MSME, all registered MSMEs must submit a valid Udyam Registration Certificate to channel partners.

There are a number of other new and better features offered by this new Udyam Registration system that will be announced and explored here as time goes on.

There is a distinction between MSME and Udyam registration.

The MSME certificate has been renamed Udyam Aadhar Certificate, and the certificate now includes a unique number called a UAN. However, both are now one and the same thing, with the exception of the certificates. In a nutshell, registering with Udyam Aadhar is a quick and painless approach to obtain an MSME registration certificate. After receiving a 12-digit UAN in your Udyam Aadhar registration certificate, it is much easier to apply for MSME registration.

What is MSME (Small and Medium-Sized Enterprise) Registration?

MSME registration took effect on October 2, 2006, with the goal of increasing the competitiveness of Micro, Small, and Medium Enterprises. MSMEs are widely known to all, and without them, a developing country like India would be unable to expand and prosper. As a result, it was critical for the government to improve the units of MSMEs for which MSME registration was introduced, so that those who were registered could take advantage of government initiatives.

What is the definition of a Micro, Small, and Medium Enterprise (MSME)?

MSMEs and SSIs were created under the MSMED Act of 2006 to improve and boost India's small-scale economy. Previously, service and manufacturing were considered separate and distinct, with different amounts mandated for the Investment Required.

 

The distinction between the manufacturing and service sectors has been erased, Investment Limits have been revised, and a Turnover Criteria has been created, according to the Ministry of Finance's most recent change to the definition of MSME. Mrs. Nirmala Sitharaman, our Finance Minister, announced this modification on May 13, 2020. Under the MSMED Act of 2006, the following are deemed MSMEs:

MSME is also known as Small Scale Industry (SSI), and UdyogAadhar or LaghuUdyog is the name for online MSME registration. The enterprise entities have been categorised into various categories as micro/small/medium under the online SSI registration based on their investment in a manufacturing firm or in the service sector.

Definition The Micro, Small and Medium Enterprises Development (MSMED) Act of 2006 establishes a framework for the development of small and medium businesses.

Micro, Small, and Medium Enterprises are roughly categorised into two categories under the MSMED Act 2006:

 

Manufacturing Businesses- This type of business is defined by investments in plant and machinery. The businesses are involved in the production of goods.

Service businesses are classified according to the amount of money invested in equipment. Service businesses are those that provide or offer services.

The following is the classification:

The Manufacturing Industry (In terms of investment in Plant and Machinery)

Micro-Enterprises — a company with a turnover of less than twenty-five lakh rupees is considered a micro-enterprise.

Small Businesses — Revenues of more than twenty-five lakh rupees but less than five crore rupees

Medium Businesses - Revenues of more than five crore rupees but less than 10 crore rupees

2. The Service Industry (In terms of Investment in equipment)

 

Microbusinesses — a company with a turnover of less than ten lakh rupees.

Small Businesses - Revenues of more than ten lakh rupees but less than two crore rupees

Medium Businesses - Revenues of more than two crore rupees but less than five crore rupees

Important Documents:

Three passport-sized photos of the proprietors, partners, or directors are required.

It is necessary to have a photocopy of the partnership deed in the case of a partnership. Under the Partnership Act, the partnership does not need to be registered.

A copy of the MOA and AOA, as well as the certificate of incorporation, are required for a private company. A copy of the company's resolution permitting one of the company's directors to sign the application form and attend the interview is also required.

Proof of Ownership, Proof of Legal Possession (rent receipt), and the Power Load Authorized by the Connection Holder to the Applicant.

The Delhi Pollution Control Committee granted permission for the unit to be built. For provisional registration, it is critical.

Because each state has its own set of document requirements, some of the paperwork may differ. The materials listed above are the bare minimum that must be presented.

MSME Registration Certificate

You will receive a mail with a reference number after successfully registering for MSME on the Udyam portal. After your registration application on the Udyam site is verified, the Ministry of MSME will send you an MSME registration certificate to your email address. This MSME registration certificate will be valid for the rest of your life and will not need to be renewed.

Within a few days of submitting your registration application, you will receive your MSME registration certificate from the Ministry of MSME. The MSME certificate can be downloaded through the Udyam portal. The following are the steps to obtain the MSME certificate:

 

Select the 'Verify/Print' tab on the Udyam Registration portal, then the 'Print Udyam Certificate' option.

Fill in your mobile number and Udyam Registration Number on the next page. You must first pick the OTP option, then the 'Validate & Generate OTP' page.

Now, enter the OTP that was sent to your email address or phone number and click the 'Validate OTP & Print' option.

The MSME Certificate will display on the next page. You are free to print it.