August 6, 2018
Coimbatore : Expressing apprehension over certain clauses of proposed Bill to amend the criteria for classification of Micro, Small and Medium Enterprises (MSME), four associations today requested the District Collector to use his good offices to represent their grievances to Union Minister for MSME to impart necessary corrections.
In a memorandum submitted to collector T N Hariharan, the associations said the MSME Act Amendment Bill was also in the same path, only to benefit big traders and companies. Through this, the fundamental objective and essence of MSME Act 2006 was challenged and diluted.
On barring traders getting registered as a micro/small unit, they said it was stated that the main object of the Act was to facilitate promotion of indigenous micro and small units engaged in manufacturing.
But in the GST era, there was no differentiation on manufacturer or trader and as per GST there were only two activities defined, either supply of goods or services and there was no different classification like manufacturer or trader of products, the memorandum said.
In the present condition, associations were apprehensive that even big traders engaged in selling imported products could get them registered as a micro or small enterprise, it requested inclusion of a clearcut clause in this amendment to bar traders to get registered as micro/small units.
With regard to turnover limit Increase, they said the amendment empowered the Government to raise turnover limit (to define a micro/small enterprise) up to Rs 225 crore, which was ridiculous and requested the Centre to desist the turnover limit increase clause at this juncture.
On classification or reclassification every year, the associations pointed out that the amendment Bill did not spell out anything, whether the first classification was subjected to change every year (as it is based on GST turnover.
In other words, there is no clarity whether enterprises have to approach the District Industries Centre every year to get classified or re-classified as their turnovers are subjected to increase or decrease. Such a situation will not facilitate ease of doing business, but will increase the cumbersome procedures.
Already in the GST era, the concessions for micro and small units are being withdrawn one after another. Duty/Tax exemptions are already abolished. The sector is losing its competitiveness after GST implementation. Big enterprises, corporates and MNCs are the beneficiaries by GST, they said. Presidents of Coimbatore Compressor Industries Association, Coimbatore Sidco Industrial Estate Manufacturers Welfare Association, Coimbatore Wet Grinder Manufacturers Association and Lagu Udyog Bharati were signatories to the memorandum.