ALL ABOUT UDYAM REGISTRATION AND HOW TO RECOVER MONEY FROM DEBTORS UNDER MSME ACT
In this blog, we will learn about what is udyam registration and how to recover money from debtors under MSME Act.
WHAT IS MSME ?
As MSME stands for Micro, Small, and Medium Enterprises, it is a very important sector for the overall development of the nation because these businesses please a substantial role in the economy, it helps in creating employment and opportunities and generate productions, they are widening their domain across all the sectors of the economy producing services and products to meet all the demands of the global market and domestic market. Udyam registration is also known as MSME registration because it is nothing but our government provides a registration process that is a recognition certificate and a unique number.
For more information, please contact us on info@trijuris.com or call us Mb. No. 85100 58386 or 9310 717274.
In exercise of the powers conferred section 7(9) and sub-section (2) read with section 8(3), of MSME Act, specifies the form and procedure for filing the memorandum hereafter in this notification to be known as Udyam Registration, with effect from the 1st day of July 2020, There are three types or classification of MSME which are micro-enterprise, small enterprise, medium enterprise.
- Micro enterprises does not exceed 25 lakh rupees in the manufacturing Sector and does not exceed Rs.10 lakh in the services sector, And up to 5 crores in proposed (based on annual turnover)
- Small enterprises exceed 25 lakh rupees but not exceed five crore rupees, but in the services sector, It exceeds 10 he lakh rupees but not exceed 2 crores and in proposed more than five crores but less than 75, crore.
- Medium enterprises more than five crore rupees and less than 10, crore And in relation to services Sector it exceeds two crore Rupees but less than five crore rupees and if we talk about proposed it exceed 75, crore rupees but less than 200 crore rupees.
BENEFITS OF THE REGISTRATION OF UDYAM
PROTECTION AGAINST PAYMENT
This is the protection against payment, the business on or the supplier will Gate protection against if there is a delay in the payment and if there is a delay of payment for more than 45 days, then the buyer has to pay the compound interest along with the interest and the interest rate is three times at the rate notified by RBI
COLLATERAL FREE BANK LOANS
The government of India guarantees funds to MSME to make free credit available to all small and micro businesses sector under this scheme.
MSME Enterprises can claim benefit, and it should be managed by SIDBI and the credit guarantee trust fund scheme, which was initiated by the government of India
SUBSIDY
If the subsidy is given to the enterprise that has a certification of MSMA and companies eligible for IPS subsidy from NSIC and credit rating
ISO CERTIFICATION
The enterprise who is registered can claim their embarrassment of the expenses that were spent for the ISO certification.
OVERDRAFT EXEMPTION
Registered MSME can avail the benefit of 1% interest rate on overdraft because it was mentioned in the scheme, and it may differ from bank to bank.
INDUSTRIAL PROMOTION
There is a subsidy if you do promotion of your industry as per according to the government rule.
BENEFITS FOR A STATE AND UT
They have their own package of incentives and facilities for small-scale Businesses.
EXCISE EXEMPTION
A MSME sector can have an exemption in excise because it is the scheme which is provided by the government of India.
RESERVATION BENEFITS
The product which was of exclusive manufacturing by MSME and SSI Can avail the reservation benefit.
For more information, please contact us on info@trijuris.com or call us Mb. No. 85100 58386 or 9310 717274.
UDYAM REGISTRATION PROCESS
- In the Udyam registration portal, the form of registration is provided. As there is a benefit, and it is based on the self-declaration with no requirement of any paper or documents certificate or proof, any person who wants to establish a MSME may file Udyam registration online in the portal.
- On the registration portal, and enterprise will be assigned a permanent Identity number which is known as the Udyam registration number.
- After the completion of the registration process, a certificate is issued, which is the Udyam registration certificate.
INFORMATION REQUIRED FOR THE UDYAM REGISTRATION
- Aadhaar card
- Pan card Of the individual
- Pan card of the company
- GST of the company
- Contact number or email of the company
- Bank details of the company/individual
- ITR statements
- State Social category as there will as SC/OBC/ST/General
- State the office address
- Employees working in the company
- State that they want to register as producer, manufacturer/services or both
RELEVANT PROVISIONS FOR RECOVERY OF MONEY UNDER MSME ACT
Section 15 deals with the supplier is eligible to get payment from the buyer within 45 days from the date of acceptance or deemed acceptance; therefore, it is noted that The period cannot exceed a maximum period of 45 days, this means that anyhow the payment is made within 45 days.
Section 15–24 of (MSMED) Act, 2006 deals with the provision of delayed payment to micro and small enterprises.
Section 20–21 deals with the settlement of disputes on getting references on delayed payment, which was dealt with by the micro and small enterprises facilitation council, which was established by state governments.
Section 16 deals with the supplier is eligible to get compound interest from the buyer on the amount at three times the bank rate if he did not make payment to the supplier within 45 days of the acceptance of the goods or services rendered.
Section 17 deals with the supplier is eligible to get payment along with interest from the buyer.
Section 18 deals with micro, small and medium enterprises may make a reference to MSEFC (facilitation council)
POINTS TO BE KEPT IN MIND
- For facilitating the registration process and further handling MSME – DI (Ministry of micro/small and medium enterprises including the development institutes) and District industries centers will do and also act as a single-window Facilitation center in their districts.
- If any person who is not able to do registration of Udyam Because of the unavailability of Aadhaar card, he may provide other documents, any other identity proof to the single window system for further process of Udyam registration
- If any person is unable to file a complaint, the District industries Centre shall undertake an enquiry for the verification of the details submitted by the enterprise and thereafter with the necessary remarks to the commissioner or concern authority of the estate after issuing a notice to the enterprise and giving an opportunity to present His case based on the finding, may amend the details to MSME, the government of India, for cancellation of Udyam registration certificate.
- Penalty – if any person tries to suppress the fact and misrepresented intentionally, then he is liable to punishable in its first conviction, which may extend to 1000, and if there is subsequent conviction, then find to which shall not less than 1000 and which may extend to 10,000
- This statute ensures us to recover at least 75% of the due amount along with the interest or disbursal of finance to the micro-enterprises supplier to keep it viable in the case if there is an appeal in the court by the supplier, and this is mentioned in section 19 of the MSME act.
- (MSEFC) Micro and small enterprises facilitation council contain 2 to 5 member which is director of industry, one or more office bearer, One or more financial institution lending to MSE, one or more persons having special knowledge in the field of trade or commerce, finance, law, industry
For more information, please contact us on info@trijuris.com or call us Mb. No. 85100 58386 or 9310 717274.
CONCLUSION
Basically, MSME is rapidly growing Sector in the nation and plays an important role in the economy, therefore who wants to start their small enterprises or business must know about the benefit and the registration process of Udyam scheme. It must be taken into consideration that there is a need to safeguard the MSME Enterprises and encourage growth among the new person to avail the benefits.
As MSME registration is not mandatory but it is always suggested that small and medium enterprises to get it done as it provides a variety of benefits like filing of cases can made easily through an online portal, and there is the process is most affordable and faster and if you to appeal then 75% of tea amount gate awarded and MSME can check their status of cases of complaint through an online portal.
Ministry of micro small and medium enterprises text the initiative for filing application by supplier four he’s the concerned case this will viewed by the facilitation council, and it is also visible to the State government, central government, departments, CPSE, Etc for proactive actions.
It should be insured by the director of the industries of the state/UT who have the administrative control that within a period of 90 days as stipulated in the act for the delayed payment cases, it should be decided or not by the council within a notified period. Hence it is concluded that every MSME sector has to be get registered and avail all Benefits of the scheme which was provided by the government.
For more information, please contact us on info@trijuris.com or call us Mb. No. 85100 58386 or 9310 717274.
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