Key Features of Udyam Registration Portal and Its Comparison with Udyog Aadhar

Key Features of Udyam Registration Portal and Its Comparison with Udyog Aadhar

Executive Summary:

This article is about:

• • • Udyog Aadhaar and Udyam Registration, wherein it describes:
      • the procedure for Udyam Registration under Micro, Small and Medium Enterprises Development (MSMED) Act, 2006,
      • benefits of Udyam Registration.
    • Classification of enterprise as per new definition and give a detailed difference between Udyog Aadhar and Udyam registration as well as other relevant information
    • Important features of the Udyam Registration Portal (new portal) and comparison between new portal and old portal i.e. Udyog Aadhar Portal
    • Helps to understand the improvement in Micro Small Medium Enterprise (MSME) Registration.

Introduction:

Anyone who wants to start a micro, small, or medium business can use the Udyam Registration portal to complete the process. Any business that has previously registered for Udyog Aadhaar must now migrate to Udyam Registration. The major goal of introducing Udyam registration is to make the registration procedure easier and faster. Small businesses can now easily register under the MSME category. The registration procedure is completely free; there are no costs or fees to be paid to anyone. By registering under the new MSME legislations, any startup and MSME company can take advantage of the various government initiatives.

Classification of Enterprises:

With effect from July 1, 2020, the Central Government has notified a revised system of categorization for micro, small, and medium firms. The categorization is based on the amount of money invested on plant and machinery vs. the amount of turnover of an entity. If the investment is –

• up to 1 crore and the entity’s turnover is up to 5 crore, the units are referred to as Micro.
• up to 10 crores and the entity’s turnover is up to 50 crores, the unit is considered small.
• up to 50 crores and the turnover is up to 250 crores, the unit is classified as medium.

It is important to understand that to be classed under a certain category; a unit must meet both of the category’s requirements, i.e. investment in plant & machinery or equipment and aggregate turnover. If any of the requirements exceed, then the entity will lose its category and moved to the next higher category.

Udyog Aadhaar vs. Udyam Registration:

• 1. The distinctions between Udyog Aadhar and Udyam registration are numerous. From July 2020, Udyam Registration and Udyog Aadhar Registration will be the same, since Udyog Aadhar Registration will be turned into the Udyam Registration process. Udyam Registration and Udyog Aadhar Registration will be the same starting in July 2020, as Udyog Aadhar Registration will be converted into the Udyam Registration procedure.
• 2. Obtaining an Udyog Aadhaar Certificate for business registration under the Ministry of MSME was very difficult and time-consuming task due to the numerous categories and pages to be completed. It necessitated a lot of paperwork and document uploading to the site. Udyam Registration, on the other hand, is a single-window; paperless process that requires no additional documents or certificates in order to register under MSME.
• 3. The main goal of introducing Udyam Registration is to make the registration procedure easier and less time consuming. Small businesses can now easily register under the MSME category.
• 4. Udyog Aadhar can be registered on several times with different organization names; however Udyam Registration can be registered with only one Aadhar Card Applicant.

The key information necessary for registration under the Act is as follows:

• Entity’s PAN and its Authorised Signatory(ies).
• Aadhaar number
• Entity Detail
  • Partnership – Managing partner
  • Proprietors – Proprietorship firm
  • Hindu Undivided Family (HUF)– Karta
  • Company or a Limited Liability Partnership or a Cooperative Society or a Society or a Trust – Authorised signatory
• Mobile No. and E-mail ID of Enterprise and person mentioned above
• Plant Address and Office Address.
• Bank information, such as account number and IFSC code
• Miscellaneous details, such as business activity code, social category, number of employees, and so on.

Benefits of getting registered as Udyam:

• Obtaining licences, approvals, and registrations becomes simple, regardless of the industry of company. For government licences and certification, enterprises registered under Udyam are given higher priority. Assists in obtaining low-interest loans.
• MSME registration helps in the obtaining of government contracts.
• They have easy credit with cheap interest rates.
• Bank loans become less expensive as a result of the Udyam registration.
• Udyam is eligible for a number of tax benefits.

Important Factors to Consider:

• Udyam registration is mandatory in India.
• For the registration process, the user will only need to give their 12-digit Aadhaar number, Pan Card, and business bank account credentials.
• The Act, as well as the Ministry’s notifications, gives no indication of the Udyam Registration Certificate being valid for a specified period of time, such as 5 years, 10 years, etc. under the new registration portal.
• According to a notification dated June 26, 2020, no business may have more than one Udyam Registration Number; however, if a business engages in both manufacturing and service, both activities will be combined into a single Udyam Registration.
• On and after April 1, 2021, all enterprises seeking registration under the Act must have a PAN and GSTIN, as per notification dated June 26, 2020.
• Udyam Registration process is a simple task fill out the simple form at msmeregistrar.org to register.

Conclusion:

Udyam Registration is the new mechanism for registering under MSME that replaces the previous Udyog Aadhaar registration. The government established the new Udyam Registration Portal, which is the MSME Department’s other operation for deploying the new path for MSME or Udyog Aadhar registration. Registration under Udyam Aadhar is optional and not required, but migrating to the new method will undoubtedly help MSME units, as we have seen in the important points and advantages discussed above. Using udyam Aadhar would surely make the process of registering for MSME units easier, and it will also be a bit faster than before. This article will assist MSME’s in understanding all of the critical criteria connected to Udyam Aadhar Registration and will assist MSME’s in selecting the best alternative for registration from the new and old portals.

Regards,
Legal Team

Proind Business Solutions Private Limited
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No.: +91 120 4224203
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