A clarification has been made by the Reserve Bank of India (RBI) regarding the applicability of certain aspects in order to classify the enterprises as MSME, with respect to the representations from IBA and banks.
It is the statutory responsibility of the GoI, Ministry of MSME according to the provisions of the MSMED Act, 2006. As per the obligations, the enterprises are required to register online and obtain the ‘Udyam Registration Certificate’.
Validity of Entrepreneurs Memorandum
The validity of the Entrepreneurs Memorandum (EM) part (II) and Udhyog Aadhar Memorandum remains valid till March 31, 2021. Such enterprises that registered till June 30, 2020 shall file new registration in the MSME Registration portal by March 31, 2020. The issued certificate from the portal on self declaration basis would be exempted from filing GSTR and/or ITR returns will be valid up to March 31, 2021.
Depreciation Cost
This online registration depreciates cost as on 31st March each year of the relevant previous year. Hence, as defined in the income tax act the value of Plant and Machinery or equipment for all the purposes and enterprises shall mean the Written down Value as at the end of financial year.
Therefore, it has been made clear that the instructions in circular FIDD.MSME & NFS.BC.No. 10/06.02.31/2017-18 dated 13 July, 2017 Investment in plant and machinery for the purpose of classification as Micro, Small, Medium Enterprises- documents to be relied upon are superseded.
Read our article:CHAMPIONS: Newly Launched Portal for MSME
Amendment With Respect To Import and Export of Currency
A notification has been made regarding amendments to the Foreign Exchange Management (Export and Import Currency) Regulations, 2015. This amendment has been brought about in the proviso the deals with import or export of currency in India. The amendment permits RBI to be in control of the same. An application is to be made which satisfies that it is necessary to import and export, then only RBI will allow the same. The RBI may stipulate the conditions if it deems fit.
It can be concluded with respect to the RBI’s[1] clarification that the enterprises are classified as Micro, Small and Medium Enterprises (MSME). Now large groups of industries would be eligible to get in the bracket of MSME as per the aforementioned clarification. This can surely help improving the visibility of the sector in terms of manufacturing and export share in country and that is how the sector would be able to participate in the direct exportation instead on being dependent on larger units.
Conclusion
With respect to the amendment made by RBI in currency import and export, the bank empowers to permit a person to take/send out of India/ bring into India, take currency notes, and/ or those of RBI. This also comes under RBI to determine that such an exchange of Indian currency is necessary. If not then they can be denied their import or export by the RBI.
Read our article:COVID-19 (SOP) Standard Operating Procedure for MSMEs at workplace
