MSME Registration Certificate in India

MSME stands for Micro, Small, and Medium Enterprises and is one major backbone of a country like India. The Indian economy is a developing one and is in need of elements that would assure the success and growth of the economy. MSME is also known as the Small-Scale Industries and helps generate a lot of employment opportunities in the country.

Company or entity would want to gain MSME registration can belong to manufacturing or production and also the service industry. MSME registration is an optional one as of the date, and the entities should understand that registering themselves under MSME will provide their various benefits in case of taxation, availing loans and credits, or other factors aiding in the development of the business.

Understanding MSME

MSME registration is a combination of Micro, Small, and Medium enterprises. The basis for determining the category to which an entity essentially belongs in MSME would be based on the investment made in plant and machinery and the turnover earned during the year.
The following are the category and its investment:

1. Micro Enterprise – For an entity to be classified as micro-enterprise, the investment made in plant and machinery should not exceed INR 1 crore. Also, the turnover earned during the year should not exceed INR 5 Crore.
2. Small Enterprise – For an entity to be classified as a small enterprise, the investment made in plant and machinery should not exceed INR 10 crore. Also, the turnover earned during the year should not exceed INR 50 Crore.
3. Medium Enterprise – For an entity to be classified as a medium enterprise, the investment made in plant and machinery should not exceed INR 50 crore. Also, the turnover earned during the year should not exceed INR 250 Crore.

Prior to this, the threshold limit of exemption was different for entities on the basis of the sector they belonged to, which included manufacturing and service. The following were the classifications or categories that existed:

– In the case of an entity belonging to the manufacturing sector:

1. Micro Enterprise– Less than INR 25 Lakhs
2. Small Enterprise – Between INR 25 Lakhs and INR 5 Crores
3. Medium Enterprise – Between INR 5 Crore and INR 10 Crore

– In the case of an entity belonging to the service sector:

1. Micro Enterprise– Less than INR 10 Lakhs
2. Small Enterprise – Between INR 10 Lakhs and INR 2 Crores
3. Medium Enterprise – Between INR 2 Crore and INR 5 Crore

Online Registration Procedure for MSME

If an entity wants to avail of the MSME Registration Certificate, it should first obtain registration under MSME. The following shall be the procedure or steps that should be followed by the entity to avail of such registration.
The MSME registration shall be done online by visiting the portal of the government, namely, ‘udyamregistration.gov.in’. For these, the following two categories shall be made available:

1. Registration of new entrepreneurs, i.e., holding EM-II (Entrepreneurship Memorandum – II) or entities not registered as MSMEs yet.
2. Registration of those having UAM (Udyog Aadhar Memorandum) and the ones with UAM acquired through Assisted Filing.

Registration of new entities, i.e., holding EM-II (Entrepreneurship Memorandum – II) or the entities not registered as MSME yet

1. The applicants falling under this category shall click on, ‘For New Enterprises who are not Registered yet as MSME or those with EM-II’ provided on the homepage of the website.
2. This shall lead to a page where the form asks for details of Aadhar number and also the name of the business owner or the entrepreneur.

iii. Once the details are entered now press the, ‘Validate and Generate OTP’, which would generate OTP to the mobile number registered with the Aadhar Card.

1. A page for PAN verification shall appear upon successful validation of the details using OTP.
2. Nowhere the ‘Type of Organization’ and PAN details of business shall be entered after which the validation button shall be applied. The portal would now get the PAN details from the Income Tax Portal or government database and validate or verify the same.
3. Once the PAN has been successfully verified, a Udyam Registration form will appear. Here the details, including mobile number and email address, should be given. After this, the details of the plant will also be provided.

vii. Along with this, the turnover details shall also be filled out. The number of employees and such other details shall be furnished.
viii. When all the necessary details are filled out, the button named ‘Submit and Get Final OTP’ shall be clicked. This will complete the process of MSME registration, and a message stating the same, and also a reference number shall also be generated automatically.

1. Now on the basis of the completion of the verification of details furnished the registration certificate shall be issued by the MSME authority.

Registration of those having UAM (Udyog Aadhar Memorandum) and the ones with UAM acquired through Assisted Filing

1. The applicants falling under this category shall click on ‘For those having registration as UAM’ or ‘For those already having registration as UAM through Assisted filing’ on the website homepage.
2. Now the applicant can choose to receive the OTP for validation using the email or mobile number given under the UAM.

iii. A page where Udyog Aadhar Number shall be entered would be opened along with two options for generating OTP. So, enter the Aadhar number and choose an option for OTP.

1. After choosing an appropriate options click on ‘Validate and Generate OTP’, which would initiate the action and the OTP shall be generated and the same shall be filled by the applicant on the website.
2. On validation of the details filled in using OTP, registration details are to be filled out on the MSME registration form, and this will mark the completion of the MSME registration with Udyam.

Documents Required

There are certain documents that should be made available to complete the registration of MSME successfully and generate a certificate. This majorly includes the Aadhar and PAN card details. There are profoundly no other documents or certificates which should be submitted as proof. The whole process can be initiated and completed online.

On the entering of the PAN details pertaining to the investment and turnover shall be fetched automatically by the Udyam website or portal from the GST database. This is possible as the Udyam Portal for Registration is completely integrated or coupled with the Income Tax and GST information systems.

Any person or entity which should mandatorily acquire GST registration as per the GST Law should have taken registration under GST prior to taking registration under MSME. The registration fees for MSME registration are nil, and no registration fees will be charged for MSME registration.

Registration Certificate of MSME

Once the registration procedure is successfully completed by the entrepreneur, a message shall be automatically generated along with a reference number pertaining to the application made. The Udyam Officials, on the receipt of the registration form, shall verify the same and also fetch data from the GST and Income Tax.

On successful completion of the verification, the Ministry of MSME shall issue Udyam Registration Certificate or the MSME Registration Certificate to the entrepreneur and this shall be sent to his email. This shall be valid for a lifetime and does not require any renewal.

To get the certificate online, the entrepreneur should do the following:
– Visit the website or the online portal and click on the ‘Print/Verify’ tab.
– Now click on the ‘Print Udyam Certificate’ option that is made available.
– A page asking for the Udyam registration number, mobile number, and OTP option.
– Now click on the Validate and Generate OTP button.
– Enter the OTP generated and validate it. Now the MSME certificate will appear; print the same.

Hence, we can now conclude that the MSME registration certificate shall be issued by the Udyam on the basis of the successful completion of the registration process. The MSME registration would open the doors and also make many processes simple for an entrepreneur and his entity which would include the taxation, availing of credits or loans, and various other benefits.

Conclusion

In India, any business or enterprise that falls under the category of micro, small, or medium-sized enterprises (MSME) can apply for MSME registration. The eligibility criteria for MSME registration are based on the investment made in plant and machinery or equipment for manufacturing or service enterprises. MSME registration offers several benefits to businesses, such as easy access to credit, tax exemptions, and government subsidies, among others.