Govt notifies revised criteria for classification of classification of micro, small and medium enterprises (MSME) with effect from 01.07.2020.

Also Read PIB Press Release- Govt further revises ceiling limits for MSME Definition

New Definitions  of MSME with effect from 01.07.2020)

Micro enterprises where the investment in Plant and Machinery or Equipment does not exceed one crore rupees and turnover does not exceed five crore rupees;
Small enterprises where the investment in Plant and Machinery or Equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees;
Medium enterprises where the investment in Plant and Machinery or Equipment does not exceed fifty crore rupees and turnover does not exceed two hundred and fifty crore rupees

Existing Definition of MSME valid upto 30th June 2020

MSME classification till 31st May 2020

Text of Notification of Government Notifying revised criteria for classification of MSME

MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES NOTIFICATION

New Delhi, the 1st June, 2020

S.O. 1702(E).—In exercise of the powers conferred by sub-section (1) read with sub-section (9) of section 7 of the ‘Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006) and in supersession of the notification of the Government of India, Ministry of Small Scale Industries, dated the 29th September, 2006, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section(ii), vide S.O. 1642(E), dated the 30th September 2006 except as respects things done or omitted to be done before such supersession, the Central Government, hereby notifies the following criteria for classification of micro, small and medium enterprises, namely:—

(i) a micro enterprise, where the investment in Plant and Machinery or Equipment does not exceed one crore rupees and turnover does not exceed five crore rupees;

(ii) a small enterprise, where the investment in Plant and Machinery or Equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees;

(iii) a medium enterprise, where the investment in Plant and Machinery or Equipment does not exceed fifty crore rupees and turnover does not exceed two hundred and fifty crore rupees.

This notification shall come into effect from 01.07.2020.

[F. No. 2/1(5)/2019-P&G/Policy (Pt.-IV)]

A. K. SHARMA, Secy.

Source- http://egazette.nic.in/WriteReadData/2020/219680.pdf

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17 Comments

  1. varsha gawas says:

    Good Afternoon.

    Is there any revision in notification to ealier -S.O. 1722(E) – In exercise of the powers conferred by sub-section (1) of 2006) MSME act. Threshold limit has been changed but what about calculation of investment in Plant & Machinery

  2. mukesh says:

    Thank you at the outset for detailed article. This means to say that the MSME benefit is available to manufacturing and service sector only and not to the Non Manufacturing business, trading community by change of definition. ~ Your valuable opinion Sir. ~ Thanks in advance.

  3. Rajinder MALIK says:

    Respected Sir,
    It is requested that please clarify what will be the impact of revised definition on already registered UNITS ?

    Regards

  4. ramaswamy says:

    Whether a unit having an investment of say 60 crores and a turnover of say 200 Cr is classified as MSME or a LSI. Similarly a unit having an investment of say 30 Cr but turnover of say 260 Cr, is considered as MSME or a LSI. Please clarify. Third, the turnover of which year is the base for this classification. Appreciate, if you could revert

    1. CS Lalit Rajput says:

      To consider as MSME – as per new definition :
      Both criterias has to be satisfied together (mandatory)

      Investment and Turnover.

      hope this will clear your doubt.

  5. CS Lalit Rajput says:

    Dear Readers,

    At present only definition criteria has been notified officially by the Ministry. For more authenticate information wait for order copies, all information posted in newspapars, are only announcements at present.

      1. CS Lalit Rajput says:

        The new / revised definition will come into force w.e.f 01st July. 2020
        till 30th June, 2020 – apply with old definition

  6. Giridhar Krishna says:

    Sir, I believe the Minister had mentioned that Export turnover will not be taken into account while computing the limits for MSME. The Newspapers had also confirmed this. However the current notification is silent on the Export Turnover. Please advise

  7. NIKITA SHARMA says:

    Thanks for your valuable information. I really like your post. Please update your posts regularly because i found interesting.

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