Article discusses Classification of Enterprises as Micro, Small and Medium Enterprises (MSME) W.E.F. 01.07.2020 as amended vide Notification S.O. 2119(E) dated 26th June 2020.

(1) Criteria for Classification of Enterprises as MSME

New-MSME-Classification

(2) Become MSME

*Any person intends to establish a MSME may file Udyam Registration online in the Udyam Registration portal, based on self declaration with no requirement to upload documents ,papers, or proof.

*on registration, an enterprises will be assigned a permanent identity number to be known as “Udyam Registration Number”

*An e-certificate, namely “Udyam Registration Certificate”shall be issued on completion the registration process.

(3) Calculation of investment in plant & machinery or equipment:

(A) The calculation of investment in p/m or equipment will be linked to the Income Tax Return (ITR) of the p.y. filed under IT 1961.

(B) In case of new enterprises, where no prior ITR is available, the Investment will be based on self-declaration of promoter of the enterprises and such relaxation end after the 31st march of the f.y. in which it file its first

(C) The expression “P&M or equipment”of the enterprises , shall have the same meaning as assigned to the P/M in the Income tax act.,1961 and shall included all tangible assets (othethan land and building , furniture and fittings)

(D)The purchase value of a P/M or Equipment ,Whether purchase first hand or second hand, shall be taken into account excluding GST.

(4) Calculation of Turnover:

(A) Export of goods & services or both, shall be excluded while calculating the turnover of any enterprises whether micro,small or medium, for the purpose of

(B) Information as regards turnover and export turnover for an enterprises shall be linked to the Income Tax Act or CGST Act and the GSTIN.

(C) The turnover related figures of such enterprises which do not have PAN will be consider on self declaration basis for a period upto 31st march 2021 and thereafter, PAN & GSTIN shall be mandatory.

(5) Registration of existing enterprises:

(A) All existing enterprises register under UM-Part-II or UAM shall register again on the Udyam Registration Portal on or aéer the 1st day of July,

(B) All enterprises registered till 30th June,2020 shaft be Re-classified in accordance with this notification.

(C) The existing enterprises register prior to 30th June,2020 shall continue to be valid only for a period upto the 31th day of March,2021.

Author Bio

Qualification: CMA
Company: PA & Associates
Location: Bhubaneswar, Odisha, IN
Member Since: 28 Jun 2020 | Total Posts: 1

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One Comment

  1. Subramanian says:

    Thanks for writing a timely article. Please write more. What is costing audit for small industries. Not necessarily tax cost audit but day to day operations. How does one technical ly study.

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