Udyog Aadhar Registration Process step by step

 

MSME Sector in India

 

 The MSME (Micro, Small and Medium ) enterprises of India are a major contributor to the economy of the country with over 3.62 Crore Enterprises in operation during the 2017-18 financial year. The MSME sector employs 55 million people and contributes about 8% to the GDP. Thus, MSMEs are a pivotal part of India’s business sector. In order to register your own MSME in India, the MSME Registration / SSI Registration procedure requires the Udyog Aadhar. In this piece, we will talk about what Udyog Aadhar is and the procedure to register for a Udyog Aadhar and how it has facilitated ease of registration and availing government benefits for MSME’ or Small Scale Industries (SSI).

 

Eligibility for being an MSME

 

The Ministry of MSME in accordance with MSME Development Act of 2006, specifies the rules for eligibility for a Small Scale Industry(SSI) to classify as an MSME. Given below is the main distinction between the 3 types of firms included in the MSME namely, Micro, Small and Medium Enterprises.

 

1. Micro Enterprises: These are the smallest entities, Micro manufacturing enterprises who have the investment of less than ₹. 25 lakh in plant and machinery, while the microservice enterprises have less than ₹ 10 lakh invested in equipment.
2. Small Enterprises: These are the small manufacturing enterprises whose investment in plant and machinery is between ₹ 25 lakh and ₹5 crores, while the small service enterprises may have between₹ 10 lakh and  ₹2 crores invested in equipment.
3. Medium Enterprises: Medium manufacturing enterprises invest between ₹5 crore and ₹10 crores in plant and machinery, while the small service enterprises invest between ₹2 crore and  ₹5 crores in equipment.

 

The government of India has enabled many schemes and are providing multiple benefits to the MSMEs registered in India in order to promote the ease of doing business in India as well as promoting the make in India initiative. Registering your MSME under the rules of the Udyog Aadhar Memorandum (UAM) has multiple perks for such companies such as MSME benefits under GST Return

MSME’s Before Udyog Aadhar

Udyog Aaadhar was introduced by the ministry in an attempt to de-clutter and streamline the process for the registration of an MSME In India.
The earlier procedural format for businesses to register under the MSME regulations was tedious and very hectic, and it involved a lot of paperwork and bureaucratic delays. The previous system of registration of an MSME before the current UAM system was called the Entrepreneur Memorandum or EM-I/II. This system had a completely heterogeneous and haphazard process of providing businesses with the MSME certificate. Some businesses had to use the national portal for their SSI registration, some had to use the individual portals provided by each state and in addition to this, there were some locations and states where only manual paperwork was the way to get your MSME registration.

 Udyog Aadhar: Introduction

The primary responsibility of the developments of the MSMEs is one to be taken up by the state governments of the respective states. However, seeing the cumbersome procedures, delays and difficulties in carrying out the operations, the Central government decided to come in and aid the state governments. The government did so using incentivized schemes and easing the registration process for such organizations.

In September 2015, the Central Government in association with the Ministry of MSME took a bold step by issuing a notification declaring that they would abolish the then current system of Entrepreneur Memorandum (EM- I). In addition to this, the government also made assurance of ease of registration as well as wider coverage of MSME to avail the benefits of the schemes state/central government has initiated for these businesses.

In October in 2015, with the notification and the suggestion of the KV Kamath committee introduced the provision of Udyog Aadhar.  So, What is Udyog Aadhar? you might ask. Essentially, Udyog Aadhar is government registration that is given to SSI’s accompanied by a recognition certificate as well as a unique number which certifies small/medium businesses and enterprises.

The main motive behind the introduction of the Udyog Aadhar was to enable the government a streamlined way to help and facilitate the maximum amount of benefits to the small-scale industries in India.

Basically, the owner/director/ proprietor of the entity will provide their 12-digit Aadhar Number whether enterprise or entity is a Sole Proprietership, an LLP or even a Private Limited Company.

Udyog Aadhar Memorandum

Udyog Aadhar Memorandum (UAM) is basically a one-page registration form containing a self-declaration format in which the respective MSME self-certifies their existence, bank account details, promoter/owners Aadhar Card Details and other information such as PAN Card details.

Filing of the Udyog Aadhar is FREE of cost there is no filing fee for Udyog Aadhar.

Once, the  form is submitted a Udyog Aadhar Acknowledgement number is generated and subsequently mailed to the e-mail address provided in the Memorandum which also contains the Udyog Aadhar Number (UAN)

The UAM is filed on a self-declaration basis and generally, as a rule of principle, it does not require any supporting documents.

However, the Central/State governments are well within their rights to ask for the proof of the information provided in the Memorandum

 

Who should get the Udyog Aadhar?

In theory, each and every type of business is eligible and can go for the Udyog Aadhar is they so wish to. It can be any type of business model including even the likes of Hindu Undivided Family (HUF), Proprietorship, One Person Company (OPC) or any other business structures.

However, as we have discussed there are certain eligibility criteria that have to be met to be a registered as an MSME. The eligibility to fall in either of the categories of the MSME have been mentioned above. Click Here to check eligibility.

Udyog Aadhar Registration Process

The registration process for the Udyog Aadhar is very simplistic and filing process is very simple as well.

Step 1: Visit the official Registration Portal for the  Registration. Click Here to visit the portal.

Step 2: Enter Personal Information
These include: Name, 12-Digit Personal Aadhar Number and Enter your mobile number.
Click on “Validate and Generate OTP”
You will receive an OTP on the number submitted
Enter the OTP and select Social Category from General, SC, ST, and OBC

Step 3: Details about the Enterprise/Identity: Name with which the general public recognises the brand

The option of Type of Organisation as well as selecting from Enterprise-1 or Enterprise-2

Step 4: Correspondence Details 

Provide the complete postal address of the company/enterprise including details like pin code , district of the registered address.

Step 5: Carry forward Information

Date on which enterprise began its operations

Step 6: Bank Details 

Bank Account details such as IFSC code of the concerned branch. This detail is readily available on the bank website.

Step 7:  Enterprise Classification 

Mainline services of the entity which includes two options:

Services or Manufacturing.

Choose the one which is the major activity of your entity

Step 8: Total Investment

Includes details like the total number of employees working for the enterprise as well as the gross investment made (in lakhs) that has been invested in the enterprise

Step 9: Select District Industry Centre and Accepting the declaration

You will be selecting the district industry centre from the provided drop-down list. After that, you will have to accept the declaration and submit your application in order to finish the process.

At last, you will get an acknowledgement number.

Documents Required for Udyog Aadhar

Below, you will find the details and documents that you will require for completing the registration process in order to obtain Udyog Aadhar for your enterprise.

• Name and Aadhar number of the business owner (as mentioned in the Aadhar card)
• Document required as proof for SC, ST and OBC social category
• Name of your organization or enterprise
• Previous registration details of your enterprise
• Type of organization that you own
• Current address and account details
• NIC Code or National Industrial Classification Code
• The total number of workers employed in your organization
• Current activities of your firm
• Email ID and mobile number of the entrepreneur
• PAN number and the total investment made in the organization by the entrepreneur

Apply for Udyog Aadhar