In this blog post, Rahul Ranjan, a Third Year student studying at Vinoba Bhave University, Hazaribagh, Jharkhand and pursuing a Diploma in Entrepreneurship Administration and Business Laws from NUJS, Kolkata, lists and describes the various businesses that can be registered under the MSMED Act. 

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In the era of a fast-changing economy, the MSMEs sector is considered as a backbone of any economy and plays a vital role in providing employment to the larger sections of society at a comparatively lower cost than larger industries along with the industrialization of rural and backward areas, which results in the assurance of a more equitable distribution of national income and wealth.

As per the annual report of the Ministry of MSMEs 2015, the MSME Sector contributes around 40% to the GDP of India and counting with the aim at facilitating the promotion and development of small and medium Enterprises. In any economy, MSMEs have been regarded as the engine of economic growth and for promoting equitable and regional development. The MSMED Act 2006 is nothing else but an advancement and merger of the Ministry of SSI and the Ministry of Agro & Rural Industries. It provides for the first-ever legal framework for the recognition of the concept of enterprises which comprise of both Manufacturing and Services entities. It defines the Medium enterprises for the first time and classifies the three tiers of these enterprises namely, Micro, Small, and Medium Enterprises.

Eligibility Criteria For Business To Get Registered Under MSMED Act, 2000

As per the provisions of the MSMED Act 2006, the eligibility criteria of businesses is determined according to the definition of enterprises which are categorized under the Head of Manufacturing Enterprises and Service Enterprises.

  • Manufacturing Enterprises- The enterprises engaged in the manufacturing and production of goods and defined in terms of investment in Plant and Machinery.
  • Service Enterprises -The enterprises engaged in providing or rendering of services and defined in terms of investment in equipments.

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Nature Of Businesses To Be Registered Under The MSMED ACT, 2006

Given below is a list of several businesses which are eligible for getting registration under the MSMEs Sector. The nature of businesses eligible to get registered under this Act depends on the registration policy of both the Central government and the State government. The major heads of business which ordinarily get registration under the MSMED Act 2006 are as follows:

  1. Leather Apparels
  2. Injection Moulding Thermoplastic Products like hair brushes, umbrella frames, plastic toys, etc.
  3. Natural Fragrance and Flavours
  4. Placement and Management Consultancy Services
  5. Training and Educational Institute
  6. Energy Efficient Pumps
  7. Xeroxing
  8. Beauty Parlour and crèches
  9. Auto Repair, Services and Garages
  10. X-Ray Clinics
  11. Tailoring
  12. Equipment Rental & Leasing
  13. Photographic lab
  14. Servicing of Agricultural Farm Equipment. For example, tractor pump repairing, ring boring machine, etc.
  15. Back Office Operation Relating to Computerised Data
  16. STD/ISD Booths
  17. Retail Trade with low Capital
  18. Multi Channels Dish cable T.V. with Dish Antenna
  19. Laundry and Dry Cleaning
  20. Toughened Metallic Ware
  21. Automotive Electronic Component products like electric stoves up to 3 KW, electric auto tan door, FHP Motor A.C., etc.
  22. Electronic Surveillance and Security
  23. Mechanical Engineering Excluding Transport Equipment. For example, steel almirahs, cocks and valves, wire cutters, etc.
  24. Engineering and Fabrication
  25. ‘Servicing Activities’ engaged in maintenance, repair, testing and servicing of all type of Electronic/Electric Equipment/Instrument, i.e., Measuring or control of instruments, T.V., Tape Recorders, VCRs, Radios, Transformer, Motors, Watches.
  26. Micro Nutrients For Plants
  27. Active Pharmaceutical Ingredients and Ayurvedic Products
  28. Khadi Products and Hosiery Products
  29. Handicraft Activities like Spinning, Weaving, Artisans, etc.
  30. Printing and Paper Products
  31. Coir Industry
  32. Wood Products and Furniture
  33. Poultry Farm
  34. Bicycle parts
  35. Stationery Items. For example, ball point pens and fountain pens.
  36. Computerised Call centre
  37. Rubber Products
  38. IT Solution Provider. Services include creation of server bank, application service provider, smart card customization service provider, etc.
  39. Industrial Testing Labs
  40. Auto Parts Components. For example, horn button, door channels, wiper blade components, battery cell tester, etc.
  41. Glass and Ceramics. For example, roofing tiles glass, flooring tiles granite, etc.

Operating Cycle Of Business Under MSME Sector

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MSMEs Business Cycle

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  1. What about law firms/CA firms? Are MSME applicable to them in case their investment is equipment is as per MSME Act?

  2. Sir as per your point no 17 Retail trader with low capital is eligible under MSMED Act. From where I can get the reference of the same. Plz suggest me

    • In terms of F.No. UAM/MC/01l2017-SME dated 27.06.2017, trading activities are not eligible for registration as an MSME.


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