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    Question

    Which of the following crit eria is/are used to d efine

    and categorise MSME s as per MSME D Act, 2006 ?  
    A Turnover and Profit Correct Answer Incorrect Answer
    B Turnover and investment Correct Answer Incorrect Answer
    C Investment and Profit Correct Answer Incorrect Answer
    D Turnover and paid-up capital Correct Answer Incorrect Answer
    E Turnover, investment and paid-up capital Correct Answer Incorrect Answer

    Solution

    A composite criterion of investment and turnover shall apply to the classification of an enterprise as micro, small or medium.  

    The definition of micro, small and medium enterprises is as under as per MSMED Act 2006 (amendment 2020):  

    • A micro enterprise is an enterprise where the investment in plant and machinery or equipment does not exceed ₹1 crore, and turnover does not exceed ₹5 crore;  
    • A small enterprise is an enterprise where the investment in plant and machinery or equipment does not exceed ₹10 crore, and turnover does not exceed ₹50 crore; and  
    • A medium enterprise is an enterprise where the investment in plant and machinery or equipment does not exceed ₹50 crore, and turnover does not exceed ₹250 crore  

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