DEFINITIONS OF SSI REGISTRATION
Benefits of Registering
The registration scheme has no statutory basis. Units would normally get registered to avail some benefits, incentives or support given either by
the
Central or State Govt. The regime of incentives offered
by the Centre
generally contains the following:
· Credit prescription (Priority sector lending), differential rates of
interest etc.
· Excise Exemption Scheme
· Exemption under Direct Tax Laws.
· Statutory support such as reservation and the Interest on Delayed
Payments Act.
(It is to be noted that the Banking Laws, Excise Law and the Direct Taxes Law
have
incorporated the word SSI in their exemption notifications. Though in
many
cases they may define it differently. However, generally the registration certificate issued by the registering authority is seen as proof of
being SSI).
States/UTs have their own package of facilities and incentives for small scale. They relate to development of industrial estates, tax subsidies, power tariff subsidies, capital investment subsidies and other support. Both the
Centre and the State, whether under law or otherwise, target their incentives and support packages generally to units registered with them.
Objectives of the Registration Scheme
They are summarized as follows:
· To enumerate and maintain a
roll of small industries to which the package of incentives and support are targeted.
· To provide a certificate enabling the units to avail statutory benefits mainly in
terms of protection.
· To serve the purpose of collection of statistics.
· To create nodal centres at the Centre, State and District levels to
promote SSI.
Features of the Scheme
Features of the scheme are as follows:
· DIC is
the
primary registering centre
· Registration is voluntary and not compulsory.
· Two types of registration is done in all States. First a
provisional
registration certificate is
given. And after
commencement of
production, a permanent registration certificate is
given.
· PRC is
normally valid for 5 years and permanent registration is given in
perpetuity.
Provisional Registration Certificate (PRC)
This is given for the pre-operative period and enables the units to obtain the term loans and working capital from financial institutions/banks
under priority sector lending.
Obtain facilities for accommodation, land, other approvals etc.
Obtain various necessary NOCs and clearances from regulatory bodies such as Pollution Control Board, Labour Regulations etc.
Permanent Registration Certificate
Enables the unit to get the following incentives/concessions:
· Income-Tax exemption and Sales Tax exemption as per State Govt.
Policy.
· Incentives and concessions in power tariff etc.
· Price and purchase preference for goods produced.
· Availability of raw material depending on existing policy.
· Permanent registration of tiny units should be renewed after 5 years.
Procedure for Registration
Features of the present procedures are as follows:
A unit can apply for PRC for any item that does not require industrial license which means items listed in Schedule-III and items not listed in
Schedule-I
or Schedule-II
of the licencing Exemption Notification. Units
employing less than 50/100 workers with/without
power can apply for registration even for those items included in
Schedule-II.
Unit applies for PRC in prescribed application form. No field enquiry is
done and PRC is issued.
PRC is valid for five years. If the entrepreneur is unable to set up the unit in
this
period, he can apply afresh at the end of five years period.
Once the unit commences production, it has to apply for permanent registration on the prescribed form.
The following will form basis of evaluation:
· The unit has obtained all necessary clearances whether statutory or
administrative. e.g. drug license under drug control order, NOC from
Pollution Control Board, if required etc.
· Unit does not violate any locational restrictions in
force, at the time of
evaluation.
· Value of plant and machinery
is within prescribed limits.
· Unit is not owned, controlled or subsidiary of any other industrial
undertaking as per notification.
De-Registration
A Small Scale Unit can violate the regulations in the following ways
which will make it liable for de-registration:
· It crosses the investment limits.
· It starts manufacturing any new item or items that
require an industrial license or other kind of statutory license.
· It does not satisfy the condition of being owned, controlled or being a
subsidiary of any other industrial undertaking.