What are Small Scale Industries
Small Scale Industries (SSIs) are the entities that are involved in manufacturing, production and services of products on micro or small scale. The maximum investment in machinery, plants and industries by Small Scale Industries cannot exceed Rs. 1 crore. Small Scale enterprises must come under the guidelines of Government of India. SSIs are considered to be the backbone of Indian economy. SSIs also help in the enhancement of employment opportunities as most of the SSIs are labour based.
How to Get Small Scale Industries (SSI) Registration
Ministry of Micro, Small and Medium Enterprises (MSMEs) facilitates the registration process for Small Scale Industries. It is essential to obtain SSI registration to avail benefits of numerous government schemes, subsidies, and incentives. SSI registration form is available online for the applicant to fill and submit to get the registration number. According to the Ministry of Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, MSMEs are classified into two types:
1. Manufacturing Enterprise
2. Service Enterprise
Small Scale Industries Registration Procedure in India
Step 1: Fill in the registration form by providing all the required information and follow the instructions, as mentioned on home page to complete the application form
Step 2: After filling the form, click on ‘Validate and Pay’ to submit the application and to pay the registration fee
Step 3: Post payment and form submission, an executive will process your application
Step 4: Once the application is approved, you shall receive the certificate online via email
Note: Validity of SSI registration certificate is for the lifetime
Registration Form consists of 21 elements to be filled online are applicant’s Aadhar card, name, social category, gender, physically handicapped, enterprise’s name, type of organization and PAN. In addition these elements include location of plant, office address, applicant’s mobile number and email ID, date of start of business, bank account number, IFS code, business activity, NIC 2 digit code, additional details about business, number of employees, investment amount in plant and machinery and finally applicant’s Aadhar card attachment.
|Types of Enterprises & Eligibility||Manufacturing Enterprise||Service Enterprise|
|Micro Enterprise||Up to Rs. 25 lakh||Up to Rs. 10 lakh|
|Small Enterprise||Up to Rs. 5 crore||Up to Rs. 2 crore|
|Medium Enterprise||Up to Rs. 10 crore||Up to Rs. 5 crore|
Note: Investment amount is done in plant & machinery only, excluding land and buildings
The distinction between the manufacturing and services enterprises has been removed by making the investment amount and annual turnover similar for enterprises engaged in both the sectors.
|MSME – Merged Criteria: Investment and Annual Turnover|
|Sector/Enterprise Type||Micro Enterprise||Small Enterprise||Medium Enterprise|
|Manufacturing & Services Sector, Both||Investment less than Rs. 1 crore|
Turnover less than Rs. 5 crore
|Investment less than Rs. 10 crore|
Turnover up to Rs. 50 crore
|Investment less than Rs. 50 crore|
Turnover up to Rs. 250 crore
Benefits of SSI Registration
- Ease of getting funding after SSI registration
- SSIs can avail various tax rebates, post SSI registration
- SSI units are granted carry forward of credit for Minimum Alternate Tax (MAT) up to 15 years
- Only SSIs are allowed to have access to certain government tenders
- Acquiring government licenses and certifications becomes easier once a unit receives a permanent registration
- As many concessions and rebates are available, therefore the cost of setting up of industry reduces
Features of Small Scale Industries (SSI)
Ownership: Usually small scale industries have a sole proprietorship or if required, partnership with a few individuals.
Control: The control of the industry is with the owner himself/herself, leading to the active participation of the owner in routine business activities.
Labor Intensive: Technology in SSI is on a nominal scale. There is extensive use of labour for production activities.
Short Reach: The operations in a small scale industry are not on large scale. Hence, they are only able to cater to regional demand.
Flexibility: As the units are comparatively small in size, changing according to the dynamic environment is more feasible for them.
Resources: Small Scale Industries are located in places where resources are easily made available. This reduces transportation costs for the manufacturer and the use of resources is also efficient.
Leading Small Scale Industries (SSIs) in India
- Basic Metal Industries
- Beverages, Tobacco & Tobacco Products
- Chemical & Chemical Products
- Cotton Textiles
- Electrical Machinery & Parts
- Food Products
- Hosiery & Garments – Wood Products
- Jute, Hemp and Mesta Textiles
- Leather & Leather Products
- Machinery & Parts except Electrical goods
- Metal Products
- Miscellaneous Manufacturing Industries
- Non-metallic Mineral Products
- Paper Products & Printing
- Repair Services
- Rubber & Plastic Products
- Transport Equipment & Parts
- Wool, Silk, Synthetic Fiber Textiles
SSIs are suppliers of various products as mentioned below:
- Domestic Utensils
- Hosiery Goods, Sheet Metal Goods
- Leather and Leather Goods
- Paints and Varnishes
- Plastic and Rubber Goods
- Preserved Foods and Vegetables
- Ready-Made Garments
- Safety Matches
- Stationery Items – Soap and Detergents
- Toothpaste and Toothpowder
- Wooden and Steel Furniture
FAQs on Small Scale Industries
Q1. What is the primary use of SSI registration?
SSI registration can be used in getting concessions and rebates from the government.
Q2. What is the maximum investment that can be done by SSI?
The maximum investment allowed for SSI is up to Rs. 1 crore.
Q3. Can I register SSI online?
Yes, you can register SSI online by visiting their official website and filling and submission of application form.
Q4. Is SSI registration compulsory?
A business unit falling into the bracket of the MSME provisions is not mandated to register under SSI. Registration is voluntary.
Q5. How is the valuation of equipment for services enterprises, and plant and machinery for manufacturing enterprises done?
For computing the value of the Plant and Machinery, and Equipment, its original value is taken into account. There are some component costs that are to be excluded.
Q6. How much time it will take to register after form submission?
Registration certificate will be issued instantly via email, as soon as you submit the application form.
Q7. What all documents do I need to submit to register?
No documents are required to register as SSI, information submitted in the application form is sufficient to get your business registered under Small Scale Industries.
Q8. Will a get a hard copy of the certificate along with email?
No, as per Government’s guidelines no paper shall be used for the benefit of environment.
Q9. What is the difference between SSI registration and MSME registration?
There is no difference between SSI and MSME registration. Earlier MSME registration was termed as SSI registration.
Q10. Is it compulsory to get registered as Small Scale Industry?
It is recommended to get registered, as Government initiated schemes, subsidies and incentives can only be availed after getting registered as Small Scale Industry.