Registration under NSIC

Last Update Date : September 14, 2018

NSIC registration

The government is the single largest buyer of a variety of products. It always emphasises on the small-scale sector to uplift and promote their business. And to increase this purchase from small-scale industries, the government launched the Government Stores Purchase Programme in 1955-56. National Small Industries Corporation (NSIC) registers these Micro and Small Enterprises (MSEs) under Single Point Registration Scheme (SPRS) to allow these enterprises to participate in Government Purchase Programme.
Learn about NSIC and how to register under the scheme.

Benefits of NSIC Registration

The enterprises registered under the SPR Scheme of NSIC are eligible to avail the benefits of Public Procurement Policy for Micro & Small Enterprises (MSEs) Order 2012. The registered units can get the listed benefits.

  1. The issue of tender sets at zero price or free of cost
  2. Exemption to registered MSEs from payment of Earnest Money Deposit (EMD)
  3. In tender participation, MSEs quoting price within a price band of L1 plus 15% shall also be allowed to supply a portion up to 20% of the requirement by bringing down their price to L1 price. This L1 price is the price of non-MSEs
  4. All the Central Ministries/Departments/PSUs are required to set at least 20% of its total annual purchase of products or services to procure from MSEs
  5. Out of the 20% above, you need to procure 4% from the MSEs owned by Scheduled Castes or Scheduled Tribes
  6. 358 items notified by the government are exclusively meant to be purchased from Small Scale Industries

Eligibility

  • All Micro and Small entities who are:
    • Registered with the Director of Industries (DI) or
    • Registered with District Industries Centres (DIS)
  • As manufacturing or service enterprises or having Acknowledgement of Entrepreneurs Memorandum are eligible for registration with NSIC under its Single Point Registration Scheme.
  • MSEs who have already commenced their commercial production but not completed one year of existence. Provisional Registration Certificate is issued to such MSEs under Single Point Registration Scheme with a monetary limit of Rs 5 lakh. This provisional certificate is valid for one year from the date of issue.

Application Process

Online

The online registration is a procedure where an assessee or an MSE is required to fill out the form and provide the necessary details and documents.
The assessee can contact the nearest NSIC branch for required documents. Further, these documents can be scanned and uploaded to complete the registration.

Offline

  1. The MSEs have to submit the application form in duplicate along with the requisite fee and documents to the Zonal/Branch and Sub-office or Extension office of NSIC situated nearest to the location.
  2. The application so submitted will be then forwarded to the concerned MSME-DI RITES Limited/Consultancy Development Centre (CDC) along with copies of required documents and requisite Draft/Pay Order of Inspection Charges in favour of concerned inspection agency requesting to carry out technical inspection of MSE and forward their recommendations in this regard.
  3. After receiving the inspection report, NSIC will issue the SPRS Registration Certificate to MSE for items/stores as recommended.

Registration Fee

The charges for registration under the NSIC are based upon the turnover of the MSE as per the latest audited financial statement. The charges are levied under 3 heads:

Turnover Micro enterprise Small enterprise
Less than 1 crore Rs 3,000 Rs 5,000
More than 1 crore Rs 3,000 plus Rs 1,500 for every additional crore. Rs 5,000 plus Rs 2,000 for every additional crore.

However, note that the maximum amount of fee for registration shall not exceed Rs 1 lakh.

Inspection Charges

For MSME_DI

  • Inspecting agency may decide the inspection charges.
  • However, they are set at Rs 2,000 for Micro-enterprises and Rs 3,000 for Small Enterprises.

For M/s RITES

  • Rs 8,000 for Micro-enterprises and Rs 11,000 for Small Enterprises
  • The same fees is applicable for renewal of registration of MSE units with a monetary limit of more than Rs 10 crore and no inspection done for the last one year.

Professional Fees

The MSEs shall also pay the professional fees to the Consultancy Development Centre for undertaking physical verification.
The fees are set at Rs 6,000 for micro enterprises and Rs 8,000 for small enterprises.

Documents Required

For Fresh Registration

  • A copy of Acknowledgement of Entrepreneurs Memorandum Part-II
  • Details of plant and machinery and raw materials showing the date of purchase and original purchase value of individual machinery
  • Self-attested copy of ownership documents of the premises or copy of lease deed
  • Declaration from the Proprietor/Partner/Director whether they have any link with Large Scale Unit(s) with details of such unit (if any) to be specified
  • Banker’s Report regarding the financial status of the applicant
  • Details of Raw Materials and Finished goods in stock
  • Copy of PAN Card
  • Audited financial statements, i.e., the balance sheet and profit & loss statement
  • Copy of Registration Certificate if registered with DGS&D or other government organisation
  • List of places where after sales service facilities (if applicable) are available
  • Items that require registration with detailed specifications

For Proof of Status (Additional)

In case of Partnership Firm

  • A general power of attorney in favour of one of the Partners
  • Partnership Deed
  • Form-A from Registrar of Firms showing the names of the partners

In the case of Private Limited Companies

  • Certificate of Incorporation duly authenticated
  • Memorandum and Articles of Association duly authenticated
  • Names of sitting Directors, their address and individual share holdings
  • Board resolution in favour of the signatory of the application and documents

In the case of Co-operative Societies

  • Certificate of Registration of Societies
  • Society’s bye-laws or regulations
  • Name of members, their address and individual shareholding
  • A current certificate from Registrar of Societies declaring that the society is still working satisfactorily
  • Details of Authorized Share Capital and Subscribed Share Capital
  • Details of movable and immovable property owned by the society
  • Resolution of Society for seeking registration under Government Purchase Programme
  • Resolution in favour of the signatory of the application and documents

• For Renewal of Registration

  • Original GP Registration Certificate
  • A copy of Acknowledgement of Entrepreneurs Memorandum Part-II
  • List of major government orders executed during last 2 years
  • Copy of audited Balance sheet for last 3 years duly signed by the authorised person with seal
  • Annexure-C of GP Application form duly signed by a Chartered Accountant
  • List of addition/deletion to the plant & machinery after the initial registration
  • Annexure-D & E duly signed by MSE

Validity Period

The Certificate of Registration granted to MSEs under Single Point Registration Scheme is valid for 2 years from the date of issue of such certificate.
The certificate needs to be reviewed and renewed every two years by verifying the commercial and technical competence of the registered MSE in manufacturing or producing the items for which NSIC has registered it.

Procedure for Calculation & Fixation of Monetary Limits of MSEs

The company’s net sales turnover during the last 3 years determines the monetary limit of a company. However, this monetary limit will be fixed by the highest turnover during the last 3 years provided the unit installed and operating capacity has not been reduced.

In case of no decrease in plant and machinery:

50% of the highest turnover during the last 3 years would be the basis for fixation of monetary limit.

In case there is a decrease of more than 10% in plant and machinery:

  1. Where the turnover of the unit has steadily increased over the last 3 years and it is into profits continuously, the monetary limit would be fixed at 50% of the net sales turnover achieved in the last year.
  2. In case the unit is into loss for one year out of past 3 years, the monetary limit would be fixed at 40% of the average net sales turnover of the past 3 years.
  3. In case the unit is into loss for 2 years out of past 3 years, the monetary limit would be fixed at 30% of the average net sales turnover of the past 3 years.
  4. In case the unit is into losses for all past 3 years, the monetary limit would be fixed at 20% of the average net sales turnover of that period.

People also ask

Q. What is the monetary limit fixed in provisional registration under SPRS?

A. The limit is Rs 5 lakhs.

Q. What is the prescribed limit for investment in plant & machinery for micro enterprises?

A. Up to R 25 lakhs.

Q. What is the prescribed limit for investment in plant & machinery for small enterprises?

A. More than Rs 25 lakhs but shall not exceed Rs 5 crores.

Q. Are service industries eligible to avail benefit of the scheme?

A. Yes. Service industries are treated at par with manufacturing industries.

Q. What is the prescribed limit for investment in equipment for micro service industry?

A. Up to Rs 10 lakhs.

Q. What is the prescribed limit for investment in equipment for small service industry?

A. More than ₹ 10 lakhs but shall not exceed Rs 2 crores.

Q. Can traders be registered under the scheme?

A. No. Traders cannot register.

Q. Can drugs and medicines manufacturing units register under SPRS?

A. No. NSIC do not register drugs and medicines manufacturing units.

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We hope, this guide answers all the questions you had about NSIC registration. If you still have any question in mind, you can post it on our TaxForum to get it answered from a tax expert.

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