27 December 2008
THE MICRO, SMALL & MEDIUM ENTERPRISES DEVELOPMENT (MSMED) ACT, 2006 BECOMES OPERATIONAL FROM 2 OCTOBER 2006 Heralding the commencement of renewed efforts for facilitating promotion and development and enhancing the competitiveness of micro, small and medium enterprises NEW NOMENCLATURE AND CLASSIFICATION OF MSME ENTERPRISES Manufacturing Enterprises Micro Small Medium Rs 25 lakh Rs 5 Crore Rs 10 Crore Rs 10 lakh Rs 2 Crore Rs 5 Crore ! ! ! ! ! ! ! ! " " " " " " " " " " " " Service Enterprises (Ceiling on investment in Plant & Machinery) (Ceiling on investment in Equipment) Salient Features Definitions Memorandum Statutory Frame ! Defines “Enterprise” instead ! Two-stage registration process ! Provides statutory basis (legally of “Industry” to give due of SSI substituted with optional enforceable) to Procurement recognition to the Service Sector. filing of memorandum with District Preference Policies of Central & State ! Pride of place to Micro Industries Centres (DICs)by all Govts. for goods & Services provided Enterprises. micro and small enterprises by micro & small enterprises. ! Investment ceiling for ! Filing of memorandum by Medium ! Strengthens the legal provisions to Manufacturing Small enterprises rendering services also check delayed payment to micro and Enterprises raised to Rs 5 Crore. optional. small enterprises. ! Defines “Medium Enterprises” ! Filing of memorandum by ! Representatives of enterprises to facilitate technology manufacturing medium Associations included in the MSE upgradation and graduation enterprises with District Industries Facilitation Councils for adjudicating Centres ( instead of the Central on cases of delayed payment. Government) ! Provision for ensuring timely and smooth flow of credit to MSMEs. ! All Schemes/Programmes of assistance being notified under the Act. ! Provides for a statutory National Board for Micro, Small & Medium enterprises to advise the Central Government on matters under the Act.
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