In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act 2006, the Micro, Small & Medium Enterprises (MSME) are classified into two classes:            

Manufacturing enterprises: The enterprises engaged in the manufacture or production of goods pertaining to any industry specified in the first schedule to the industries (Development and regulation Act, 1951), or employing plant and machinery in the process of value addition to the final product having a distinct name or character or use. The manufacturing enterprises are defined in terms of investment in plants & machinery.

Service Enterprises:The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment.

This is explained in detail below:

If you are a Manufacturer:

• Micro Enterprises - Does not exceed INR 25 lakh

• Small Enterprises - More than INR 25 lakh but does not exceed INR 5 crore

• Medium Enterprises - More than INR 5 crore but does not exceed INR 10 crore

If you are a Service provider:

• Micro Enterprises - Does not exceed INR 10 lakh

• Small Enterprises - More than  INR 10 lakh but does not exceed INR 2 crore

• Medium Enterprises - More than INR 2 crore but does not exceed INR 5 crore

If your SME fits into any of these categories, it will be able to reap benefits from the Government under the provisions MSMED Act. In order to be eligible to get these benefits, you should register your SME as MSME/SSI enterprise under MSMED Act.

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