August 22, 2024

MSME industries are the backbone of the economy. They are also known as Small Scale Industries (SSIs). The government of India provides an MSME registration to the industries classified by the government as Micro, Small and Medium Enterprises (MSME) in India. The MSME registration helps MSMEs to obtain various benefits provided by the government for their establishment and growth.  What is MSME? MSME stands for Micro, Small, and Medium Enterprises. It is a classification introduced by the Government of India following the Micro, Small, and Medium Enterprises Development (MSMED) Act of 2006. These enterprises primarily produce, manufacture, process, or preserve goods and commodities. The MSME sector is crucial to India’s economy, contributing significantly to employment generation and overall economic growth What is Udyam Registration/MSME Registration? Udyam Registration is an electronic certificate issued by the Indian government to Micro, Small, and Medium-sized Enterprises (MSMEs) operating in the country. It has replaced the earlier Udyog Aadhaar Memorandum (UAM) registration process. While Udyam registration is not mandatory, it offers significant benefits to MSMEs, making it advantageous for them to apply for this registration. By obtaining Udyam registration, MSMEs become eligible for various government benefits and incentives exclusively available to enterprises under the MSME category. The registration process for Udyam is entirely based on self-declaration, eliminating the need to upload any documents, papers, certificates, or proofs. MSME Registration Eligibility All manufacturing, service industries, wholesale, and retail trade that fulfil the revised MSME classification criteria of annual turnover and investment can apply for MSME registration. Thus, the MSME registration eligibility depends on an entity’s annual turnover and investment. The following entities are eligible for MSME registration: Individuals, startups, business owners, and entrepreneurs Private and public limited companies Sole proprietorship Partnership firm Limited Liability Partnerships (LLPs) Self Help Groups (SHGs) Co-operative societies Trust Eligibility for MSME Registration Process Micro Enterprises: Micro enterprises are those whose investment in machinery, plant, or equipment does not exceed Rs. 1 crore, and their annual turnover is below Rs. 5 crore. Small Enterprises: Small enterprises are those whose investment in machinery, plant, or equipment is below Rs. 10 crore, and their annual turnover is less than Rs—50 crore. Medium Enterprises: Medium enterprises are those whose machinery, plant, or equipment investment does not surpass Rs. 50 crore and their annual turnover does not exceed Rs. 250 crore. Documents Required for MSME Registration PAN Card Number: The enterprise’s Permanent Account (PAN) card number. Aadhaar Number: The Aadhaar card number of the individual associated with the enterprise, depending on the type of organization: Proprietorship Firm: Aadhaar card number of the proprietor. Partnership Firm: Aadhaar card number of the managing partner. Hindu Undivided Family (HUF): Aadhaar card number of the Karta. Limited Liability Partnership (LLP), Company, Cooperative Society, or Trust: Aadhaar card number of the authorized signatory. GST Number: The enterprise’s Goods and Services Tax (GST) identification number. Benefits of Udyam Registration Access to Government Schemes: Udyam registration is a prerequisite for MSMEs to avail themselves of various government schemes and programs the Ministry of MSME offers. These schemes include the Credit Linked Capital Subsidy, Credit Guarantee, Public Procurement Policy, and more. Registering under Udyam ensures that MSMEs can tap into these initiatives and receive essential financial support and incentives. Seamless Integration: The Udyam portal seamlessly integrates with other critical government systems, such as the income tax portal, GST identification systems, and government e-marketplace. This integration streamlines various administrative processes, making it easier for MSMEs to manage their financial and tax-related affairs efficiently. Priority Sector Lending: With Udyam registration, MSMEs become eligible for priority sector lending from banks. This special lending consideration enables them to access credit facilities more efficiently and at favorable terms, further supporting their business expansion and investment plans. Extended MAT Credit: MSMEs with Udyam registration are entitled to carry forward Minimum Alternate Tax (MAT) credit for 15 years instead of the previous ten years. This extension provides them additional tax benefits, facilitating better financial planning and stability for their long-term growth. Lower Interest Rates: One of the most significant advantages of Udyam registration is the ability to secure bank loans at lower interest rates. Typically, MSMEs with Udyam registration can avail of loans as low as 1% to 1.5%, reducing their financial burden and enhancing their capacity to invest in business expansion and innovation. How to Get Udyam Registration Online? Step 1: Visit the Udyam registration portal. Step 2: On the homepage, click the option ‘For new entrepreneurs who are not registered yet as MSME or those with EM-II.’ Step 3: Enter the ‘Aadhaar Number’ and the ‘Name of Entrepreneur,’ then click the ‘Validate & Generate OTP’ button. Step 4: An OTP will be sent to the mobile number linked with the Aadhaar card. Enter the OTP and click on the ‘Validate’ button. Step 5: Once the Aadhaar is validated, proceed to the PAN verification page. Enter the ‘Type of Organisation’ ‘PAN’ number, and click the ‘Validate’ button. Also, indicate whether you have filed the previous year’s ITR and if you have a GSTIN. Step 6: The Udyam registration application form will appear. Fill in all required details, including the name of the entrepreneur, mobile number, name of the enterprise, location of the plant/unit, address of the enterprise, status of enterprise, bank details, activity of the unit, NIC code, and number of persons employed. Step 7: Provide the following Details. Click the Submit button and Get the Final OTP. Investment in plant and machinery details and turnover details. Select the declaration. Step 8: Enter the final OTP received and submit the form. You will receive the Udyam e-registration certificate in your email. FAQs What is the MSME registration verification? Entrepreneurs can verify their Udyam registration number by following the below steps: Visit the Udyam registration portal. Click on the ‘Print/Verify’ option and click on the ‘Verify Udyam Registration Number’ option. Enter the ‘Udyam Registration/Reference Number’, enter the captcha code and click on the ‘Verify’ button.  How to cancel MSME registration? Once the MSME application is submitted, it cannot be cancelled. MSME Registration Certificate will be issued within 2-4 days of submission of MSME online application form

Gifting is one of the many mediums through which one can transfer their property to another person. To give this transaction legal backing, a gift deed must be drafted, executed and duly registered after the payment of applicable gift deed stamp duty and registration charges. In India, property transfers as gifts are governed by the Transfer of Property Act, 1882 (“Act”). A gift of a property involves transferring the ownership of one’s property to another person by executing a gift deed. The gift deed is an instrument through which the immovable or movable property owner transfers his/her property to another person without consideration as a gift. The person gifting his/her property is called the donor, and the person accepting the gift is the donee. The donor must voluntarily gift the property to the donee without considering the gift to be valid under the Act. The donee should accept the gift within the lifetime of the donor for the gift to be legally valid. The gift of immovable property will be effective when the gift deed is registered with the appropriate Registrar or Sub-Registrar. The gift of movable property is effective when the gift deed is registered or by delivery of the property. When the gift deed is registered, the transfer of the property from the donor to the donee takes place immediately, and the parties need not go to court for its execution.  Registration of the gift deed is mandatory when the donor wishes to gift immovable property to the donee. A gift deed must be executed out of love and affection towards the donee without any consideration in return. A Gift Deed: What is it? A gift deed is an agreement that is used when a person wants to donate their property or money to someone else. With a deed of gift, a movable or immovable thing can be donated voluntarily, from the donor to the recipient. A gift deed allows the property owner to gift the property to anyone and prevents future disputes arising from inheritance claims. A registered deed of gift is also proof in itself and unlike a will, the transfer of property is instant and you will not have to go to court to execute the deed of gift thus a deed of gift also saves time. Parties in a Gift Deed There are two parties in a gift deed, i.e. donor and donee. The donor is the person who gifts his property, and the donee is the person to whom the property is gifted. The donor should have a sound mind and must be competent to enter into agreements at the time of making the gift.  A minor is incapable of gifting property as he/she is incapable of entering into agreements. However, the guardian of a minor can accept the gifts given to a minor on his/her behalf. The donor should make a gift without any consideration, i.e. the donor should not receive anything from the donee for making the gift. Clauses in a Gift Deed Details of Donor and Donee – The gift deed should mention the name, address and relationship between the donor and donee.  Consideration – The gift deed should mention that the donor is transferring the gift property out of love and affection towards the donee, and there is no consideration of any other type involved in the transfer.  Voluntary Transfer – The gift deed should mention that the donor is voluntarily and freely transferring the ownership of the gift property to the donee. The transfer shall be free of any fear, coercion or threat.  Ownership of Property – The gift deed should mention that the property is in existence and the donor is the absolute owner of the gift property, and the donor has delivered the possession of the gift property to the donee.  Property Details – The gift deed should specify the detailed description of the gift property.  Rights of the Donee – The gift deed should mention the rights of the donee. It includes the rights of the donee to enjoy the property peacefully and sell or mortgage or lease the property.  Acceptance by Donee – The gift deed should mention that the donee accepts the gift of the property. Delivery – The gift deed should mention the intention of delivering the possession of the gift property, expressly or impliedly.  Witnesses – The gift deed should mention the name and address of the witnesses. It should be signed and attested by at least two witnesses mandatorily. Revocation – The gift deed need not have a revocation clause of the gift property, but it is advisable to avoid any conflict in the future. Properties that can be donated by gift deed The donor can donate real estate and movable property to the recipient. Immovable property means land or any benefits arising from land or anything connected with land but does not include growing crops, standing timber, or grass. Real estate that is not considered immovable property is considered movable property.However, the donor can only donate real estate that exists at the time the donation contract is drawn up. He cannot donate property that he expects or will acquire in the future. The donor can only donate property of which he is the rightful owner. The donor must own the gift property at the time of donation. Gift Deed: Important Points to Mention There is no force or money involved: Be sure to add this consideration clause to the gift agreement. It must be stated that no money is exchanged and that the deed of gift is made purely out of love and affection, not money or coercion. When making a gift, you are the owner of your property: Only the owner can donate the property. If you are not the owner (title holder) of the property, you cannot gift it to someone else, even in advance. Describe the property: All information related to the property such as structure, type of property, address, area, location, etc. must be given in the format of the gift deed of the property. The donor and the recipient