Micro,Small and Medium Enterprises

  Micro,Small and Medium Enterprises

The Modi  government amending the definition of Micro ,Small and Medium enterprises. The new definition also does away with the distinction between manufacturing and service sector entities.

Due to Covid-19 Central Government now amending the definition of Micro, Small,and Medium Enterprises so these enterprises can get special privilege to get Government facility and Bank loan.

The Basis of classification of Micro, Small, Medium enterprises are on  Investment and Turnover

Particulars Investment (in Rs. CR)<  Annual Turnover  (in Rs.CR)<
Micro  Enterprises Manufacturing  or Services 1 5
Small  Enterprises Manufacturing  or Services 10 50
Medium Enterprises Manufacturing  or Services 20 100

Old definition  as under

The Government of India has enacted the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 in terms of which the definition of micro, small and medium enterprises is as under:

  • Enterprises engaged in the manufacture or production, processing or preservation of goods as specified below:
    • A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 25 lakh;
    • A small enterprise is an enterprise where the investment in plant and machinery is more than Rs. 25 lakh but does not exceed Rs. 5 crore;
    • A medium enterprise is an enterprise where the investment in plant and machinery is more than Rs.5 crore but does not exceed Rs.10 crore.
      In case of the above enterprises, investment in plant and machinery is the original cost excluding land and building and the items specified by the Ministry of Small Scale Industries .
  • Enterprises engaged in providing or rendering of services and whose investment in equipment (original cost excluding land and building and furniture, fittings and other items not directly related to the service rendered or as may be notified under the MSMED Act, 2006 are specified below.
    • A micro enterprise is an enterprise where the investment in equipment does not exceed Rs. 10 lakh;
    • A small enterprise is an enterprise where the investment in equipment is more than Rs.10 lakh but does not exceed Rs. 2 crore;
    • A medium enterprise is an enterprise where the investment in equipment is more than Rs. 2 crore but does not exceed Rs. 5 crore

 

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