Micro, Small and Medium Enterprises.

Micro, Small and Medium Enterprises.

Change in the basis of classifying Micro, Small and Medium Enterprises.

The Union Cabinet approved Change in the basis of classifying Micro, Small and Medium Enterprises from 'Investment in plant & machinery/equipment' to 'annual turnover'.

➥Section 7 of the Micro,Small and Medium Enterprises Development Act(MSMED) Act, 2006 was amended to define units producing goods and rendering services in terms of annual turnover as follows:

A micro enterprise will be defined as a unit where the annual turnover does not exceed five crore rupees.

A small enterprise will be defined as a unit where the annual turnover is more than five crore rupees but does not exceed Rs 75 crore.

A medium enterprise will be defined as a unit where the annual turnover is more than 75 crore rupees but does not exceed Rs 250 crore.

Additionally, the central government may, by notification vary turnover limits, which shall not exceed thrice the limits specified in section 7 of the MSMED Act.