Page 47 - Banking Finance July 2020

ARTICLE

LET'S

UNDERSTAND

MSMES UNDER

NEW RULE

T ill 25th may 2020, the classification of MSMEs with sub-section (9) of section 7 of the 'Micro, Small and

was done based on investment in plant &
Medium Enterprises Development Act, 2006 (27 of 2006)
machinery/equipment in accordance with the
and in supersession of the notification of the Government
provision of Section 7 of MSMED Act, 2006, but
September, 2006, published in the Gazette of India,
on 26th of May 2020 while delivering the part of Atma of India, Ministry of Small Scale Industries, dated the 29th
Nirbhar Bharat Package, our Finance Minister Smt. Nirmala Extraordinary, Part II, Section 3, Sub-section(ii), vide S.O.
Sitharaman brought up a change in the definition of MSMEs 1642(E), dated the 30th September 2006 except as respects
by announcing the amendments in the section 7 of MSMED things done or omitted to be done before such supersession,
Act, 2006. Earlier, the MSMEs were defined on the basis of the Central Government, hereby notifies the following
investments put in, now the revised definitions will also criteria for classification of micro, small and medium
include turnover of the company. Government also declared enterprises, namely:-
that there will be no more distinction between (i) Micro enterprise, where the investment in Plant and
Manufacturing and Service MSMEs. Machinery or Equipment does not exceed one crore
rupees and turnover does not exceed five crore rupees;
In exercise of the powers conferred by sub-section (1) read
(ii) Small enterprise, where the investment in Plant and
Machinery or Equipment does not exceed ten crore
About the author rupees and turnover does not exceed fifty crore rupees;
(iii) Medium enterprise, where the investment in Plant and
Rohit Narain Singh
Sr. Manager (Faculty) Machinery or Equipment does not exceed fifty crore
Union Bank of India rupees and turnover does not exceed two hundred and
Staff Training Centre, fifty crore rupees.
Union Bank Bhawan, Lucknow
This notification shall come into effect from 01.07.2020.

BANKING FINANCE | JULY | 2020 | 47