Bill to determine industry on turnover basis not in favour of MSME, says Cuttak MP Mahtab

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KNN India, July 24, 2018

Soon after the Minister of State for Micro Small and Medium Enterprises (MoMSME) Giriraj Singh introduced the Bill to amend the MSMED Act, 2006 was introduced in the Lok Sabha, a MP from Cuttak Bhartruhari Mahtab objected to the idea of determining an industry on turnover basis.

Raising objection, Mahtab said, “The Bill, which was withdrawn, has already been withdrawn, and there the amount of a micro, small and medium industries was mentioned. This Bill was introduced in 2015.”

He pointed that in the new Bill, which is being introduced, with regards to the micro enterprise, the provision is that the annual turnover does not exceed Rs.5 crore; in respect of small enterprise, the annual turnover

is more than Rs.5 crore but does not exceed Rs.75 crore, and in respect of medium enterprises, the annual turnover is more than Rs.75 crore and does not exceed Rs.250 crore.

Here the change is the turnover of a unit or an industry has come into and thereby you are denying the benefit to those small, micro and medium industries, he said.

He further objected saying that “This is not at all acceptable, and this is something which goes against

our micro, small and medium industries. It is the investment on the micro, small and medium industries that is to be determined and not the turnover.”

Mahtab appealed to the House that “let the Minister go back and try to impress upon his officials and the Government that this is not in favour of the industry, especially the micro, small and medium industries.”

In the Lok Sabha session on Monday, bill intended to change the criteria of classification of MSMEs from the existing based on ‘investment in plant and machinery or equipment’ to ‘annual turnover’ of the enterprise was introduced.

As per the amendments, any business with a turnover of up to Rs 5 crore would be considered as a ‘micro enterprise’. A ‘small enterprise’ would be the one whose annual turnover is more than Rs 5 crore to Rs 75 crore and those with turnover over Rs 75 crore but upto Rs 250 crore would be deemed as a ‘medium enterprise’.

The 2006 MSME Act was enacted to facilitate the promotion and development and enhancing competitiveness of MSMEs.

This news can also be viewed at: http://knnindia.co.in/

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