New Comprehensive Rules Notified for MSMES Requiring Udyam Registration

The Ministry of Micro, Small and Medium Enterprises (MSME Ministry) vide its notice dated June 26, 2020 (Notification) supplanted its prior warnings dated June 01, 2020; June 30, 2017; November 01, 2013 and October 05, 2006 and advised the composite standards of venture and turnover for characterization of the undertakings into miniature, little and medium class and the methodology to apply for Udyam Registration, with impact from July 01, 2020.

Udyam Registration of Existing Enterprises and New Enterprises

The undertakings falling under the miniature, little and medium class would be expected to get a Udyam Registration Number (URN) by enlisting itself on the Udyam RegistrationPortal.

 No undertaking ought to get more than one URN, be that as it may, it can specify quite a few exercises including assembling or administration or both in one URN.

All current endeavours enrolled under Entrepreneur Memorandum-Part-II or Udyog Aadhaar Memorandum need to enlist again on Udyam Registration Portal on or after July 01, 2020. 

It is essential to take note that all endeavours enlisted till June 30, 2020 would be renamed as per this Notification. Further, the enrollments acquired by the current undertakings before June 30, 2020 would keep on being substantial until March 31, 2021.

Connecting of MSME Classification with ITR and GSTIN

The MSME Ministry has explained that the new MSME order would be connected with Income Tax Return (ITR) and the Goods and Services Tax Identification Number (GSTIN).

The Notification gives that the articulation “plant and apparatus or hardware” of an endeavour, would have a similar importance as allocated to the plant and apparatus in the Income Tax Rules, 1962 outlined under the Income Tax Act, 1961 (IT Act) and would incorporate every single unmistakable resource (other than land and building, furniture and fittings). 

Further, it likewise expresses that the estimation of interest in plant and apparatus or hardware would be connected to the ITR of the earlier years documented under the IT Act and in the event of another endeavour, where no earlier ITR is accessible, the venture would be founded on self-announcement of the advertiser of the undertaking and such unwinding would end after March 31 of the monetary year wherein it records its first ITR.

Further, the Notification additionally explained that the commodity of labor and products or both, would be avoided while computing the turnover of any venture, with the end goal of order of an endeavour into miniature, little or medium class. 

It is likewise furnished that the data with respect to turnover and product turnover of a venture would be connected to the IT Act or the Central Goods and Services Act, 2017 and the GSTIN.

Every one of the undertakings having GSTIN recorded against a similar Permanent Account Number (PAN) will be all in all treated as one endeavour and the turnover and speculation figures for all such ventures would be seen together and the total qualities would be considered for deciding the relevant classification.

Updation of data and change period in characterization

An undertaking having URN needs to refresh its data consistently on Udyam Registration Portal, including the subtleties of the ITR and the GST Return for the past monetary year and such other extra data as might be expected, on self-assertion premise.

 It is critical to take note of that inability to refresh the important data inside the predetermined period would deliver the situation with the undertaking as suspended.

The characterization of an endeavor would be refreshed in light of the data outfitted or assembled from the Government sources including ITR or GST return.

 If there should arise an occurrence of up or descending change in the situation with an endeavor, a correspondence would be shipped off the venture about the said change. 

The Notification likewise accommodates the progress time frame assuming there is a vertical or descending change in the situation with a venture.

With the notice of the new complete principles for MSMEs, the Government has extended the extent of MSME area generally.

Recommended read: udyam re -registration 

 Presently, even the huge endeavors based on the new MSME Classification can get themselves enlisted on Udyam Registration Portal and profit the advantages/exceptions saved for MSME area, which were prior not accessible to them. 

It is essential to take note of that the enrollment on Udyam Registration Portal is willful and not commanded by the MSME Ministry. Nonetheless, for profiting the advantages/exclusions accessible to MSME area, the undertakings should get themselves enlisted on Udyam Registration Portal on or after July 01, 2020.