MSME new definition

Govt. under the Ministry of Micro, Small & Medium Enterprises has vide its notification dated 1st June, 2020 amended the criteria for classification of micro, small & medium enterprises in the country. This amendment will be effective from 1st July, 2020.

As per the new definition

(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.

So in each case, both the criteria has to be satisfied i.e. the investment and the turnover. Where for example a micro enterprise turnover exceeds Rs. 5 crore but its investment is still under Rs.1 crore it will still be considered as a micro enterprise until its investment also exceeds Rs.1 crore.

I guess the cutoff date for reckoning investment limits and turnover will be the financial year end and that too on the basis of audited financial results.

Leave a comment

Filed under Uncategorized

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s