Can I Start a Business With Udyog Aadhar?

An applicant can start a business with Udyog Aadhar portal, provided it is related to the manufacturing or service sector. The businesses must, however, conform to the stipulated investment and turnover threshold, in order to be eligible to be registered on the Udyog Aadhar platform.

Udyog Aadhar is a forum that enables the registration of businesses belonging to micro, small, and medium-sized (MSME) establishments. The registration of these establishments is governed by the Micro, Small, Medium-sized Enterprises Development (MSMED) Act, 2006. The businesses intending to be referred to as MSMEs must get themselves registered on the Udyog Aadhar portal. The MSME, undoubtedly, is acting as the backbone of the Indian economy, as a result of their exemplary contribution to the country’s Gross Domestic Product (GDP). The key objectives with respect to the registration of the MSMEs on the Udyog Aadhar forum are:

  • To enable the businesses belonging to the MSME sector to grow big enough to compete with international businesses
  • Create better job opportunities through the MSME establishments thereby alleviating poverty and unemployment
  • To make these industries, collectively utilise the government’s exclusive subsidies such as guarantee-free loans
  • To safeguard the MSMEs from the harassment and undue influence exerted by big and well-established industries.

Genre of Business That Can Be Registered With Udyog Aadhar?

Although the perks promised for those businesses that register on the Udyog Aadhar are tempting, not every type of business can be registered. Only those establishments that can be classified as an MSME industry, based on the amount of its investment in the business, are eligible to register under Udyog Aadhar: Therefore, while a business can be started and registered on the Udyog Aadhar portal, it is mandatory that the respective businesses, whether belonging to the manufacturing or service sector, must strictly be an MSME establishment. The following table clearly points out the prerequisites for an MSMSE establishment. Only those industries can be registered on the Udyog Aadhar portal.

Type of MSME Investment in Plant and Machinery Manufacturing Industry Investment in Service Industry
Micro Enterprise Upto ₹25 lakhs Upto ₹10lakhs
Small Enterprise Upto ₹5 crores Upto ₹2 crores
Medium Enterprise Upto ₹10 crores Upto ₹5 crores

Thus, any business can be easily registered in the Udyog Aadhar portal, and the only prerequisite is that the business should belong to one of the categories elucidated in the table shown above. The business should either belong to the manufacturing sector or should belong to the service industry in order to be eligible for registration with Udyog Aadhar.

For more details check: MSME Registration

Documents Required to Carry Out the Registration With Udyog Aadhar

The documents required to be furnished during the registration of an MSME depend on the type of corporate entity the MSME is incorporated into. For instance, if the MSME is a proprietorship firm, the applicant’s Aadhar card and personal details are to be furnished. In the case of a partnership firm, the Aadhar card of one of the partners may be used. In case, the MSME is being incorporated into a private company, the Aadhar details of the Director have to be submitted. If the MSME is an LLP (limited liability partnership firm), the Designated Partner’s Aadhar details are required. If the applicant does not possess an Aadhar card, the first step to be pursued would be to make an application and get hold of the Aadhar card.

It has to be kept in mind that the registration of a company in general and the registration of a company in Udyog Aadhar are completely different. While registering a company pertains to registering the business into a private limited company, LLP, or a partnership firm, the registration in Udyog Aadhar refers to the registration of small-scale businesses into micro, small and medium-sized industries.

Regardless of the type of corporate entity, the following information has to be furnished along with the Udyog Aadhar application:

  • Name of the MSME establishment
  • Social category of the applicant
  • Details of previous registration, if any
  • Type of business
  • Address of registered office
  • Bank account details of the establishment
  • National industrial classification code or (NIC) code
  • District industry centre (DIC) total number of employees on the payroll of the respective MSME
  • Activities of the business
  • Email ID and mobile number of the applicant
  • PAN (permanent account number)
  • Total investment pitched in for the business.

Once all the details are filled in, the applicant has to submit the Udyog Aadhar application, after which the applicant is given an acknowledgment number with which the application can be tracked. The details thus given can be edited or updated if required by logging in to the official portal. It is pertinent to note that the Udyog Aadhar is now being migrated to the Udyam registration portal. By registering in Udyog Aadhar, the businesses will be eligible to receive the emoluments given by the government to the MSMEs. If you have any queries reach out to Vakilsearch.

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