Lok Sabha Question No. 3082 (UNSTARRED), answered on 2018-01-05
Subject: Financial Assistance to Small and Medium Industries
Ministry: FINANCE
Asked by: KAMLA DEVI PATLE

## Government of India Ministry of Finance

## Department of Revenue LOK SABHA

## UNSTARRED QUESTIONS NO. 3082

TO BE ANSWERED ON FRIDAY, JANUARY 05, 2018 PAUSHA  15, 1939 (SAKA)

## FINANCIAL ASSISTANCE TO SMALL AND MEDIUM INDUSTRIES

†3082. SHRIMATI KAMLA DEVI PAATLE:

Will the Minister of FINANCE be pleased to state:

- (a) the details of norms for grant of tax rebate for small scale industries;
- (b) whether the Government  proposes to provide any financial assistance for the development of sick and closed up small and medium public sector industries;
- (c) if so, the details thereof; and
- (d)  the  details  of  such  industries  on  the  verge  of  closure  due  to  dire  financial  situation, State/UT-wise?

## ANSWER MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHIV PRATAP SHUKLA)

(a): The details of norms for grant of tax rebate for small scale industries are as under:-

## Direct Tax

|   S.No. | Total Turnover or Gross Receipts in case of a domestic company   | Rate of Tax                                                                           |
|---------|------------------------------------------------------------------|---------------------------------------------------------------------------------------|
|       1 | Not exceeding Rs. 5 crore in the previous year 2014-15           | Its income is taxable at the rate of twenty-nine per cent for assessment year 2017-18 |
|       2 | Not exceeding Rs. 50 crore in the previous year 2015-16          | Its income is taxable at the rate of twenty-five per cent for assessment year 2018-19 |

Further,  in  case  of  a  domestic  company  satisfying  conditions  of  section  115BA,  its income  is  taxable  at  the  rate  of  twenty-five  per  cent  from  assessment  year  2017-18 onwards.

## Indirect Tax

Persons having aggregate turnover in a financial year less than Rs 20 lakhs (Rs 10 lakhs in special category States except Jammu and Kashmir) are exempt from taking registration under CGST Act, 2017, and thus are not liable to pay GST on their supplies.

Further persons engaged in making supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or  any  drink  (other  than  alcoholic  liquor  for  human  consumption),  having  aggregate turnover in the preceding financial year below Rs 1 Crore(Rs 75 lakhs in special category

States except Jammu and Kashmir and Uttarakhand) are eligible for Composition scheme, under which they may opt to pay in lieu of GST, an amount calculated at the rate of 5% of the turnover. (b) to (d): The government has notified Framework for Revival and Rehabilitation of Micro, Small and Medium Enterprises on 29.05.2015 to revive and rehabilitate sick MSMEs. RBI has carried out certain changes in their Framework in order to make it compatible with the  existing  regulatory  guidelines  and  issued  revised  Framework  to  all  Scheduled Commercial Banks on March 17, 2016. Under this framework, the branch maintaining the account should consider forwarding  the  stressed  accounts  with  aggregate  loan  limits  above  Rs.  10  lakh  to  the Committee for a suitable Corrective Action Plan (CAP). The Committee constituted by the banks has representatives from State Governments, experts, regional or zonal head of the bank and the officer in charge of MSMEs credit department of the bank. The committee explores various options to resolve the stress in the account. The intention is to arrive at an early and feasible solution to preserve the economic value of the underlying assets as well as the lender's loans and also to allow the enterprise to continue with its business. The  options  under  Corrective  Action  Plan  (CAP)  by  Committee  may  include:  (i) Rectification-regularise  the  account  so  that  the  account  does  not  slip  into  the  nonperforming asset (NPA) category, (ii) Restructuring -restructuring the account if it is prima facie viable and the borrower is not a willful defaulter, and (iii) Recovery-when none of the options at (i) and (ii) above are seen as not feasible. Further  the  details  of  the  sick  MSMEs  and  corrective  action  plan  are  enclosed  as

Annexure -I & Annexure-II respectively.

*****

Annexure II

Annexure II as referred to in reply to part (b) to (d) of Unstarred Question No. 3082 to be answred in Lok Sabha on 05.01.2018

| Scheduled Commercial Banks   | Micro, Small & Medium Enterprises cases handled by the committees      | Micro, Small & Medium Enterprises cases handled by the committees      | Micro, Small & Medium Enterprises cases handled by the committees   | Micro, Small & Medium Enterprises cases handled by the committees   | Micro, Small & Medium Enterprises cases handled by the committees   |
|------------------------------|------------------------------------------------------------------------|------------------------------------------------------------------------|---------------------------------------------------------------------|---------------------------------------------------------------------|---------------------------------------------------------------------|
| Scheduled Commercial Banks   | No. of cases referred to the committees during the HY ended March 2017 | No. of cases resolved by the committees during the HY ended March 2017 | Corrective Action Plan (CAP) by the committees (Out of (2))         | Corrective Action Plan (CAP) by the committees (Out of (2))         | Corrective Action Plan (CAP) by the committees (Out of (2))         |
| Scheduled Commercial Banks   | No. of cases referred to the committees during the HY ended March 2017 | No. of cases resolved by the committees during the HY ended March 2017 | Rectification                                                       | Restructuring                                                       | Recovery                                                            |
| Scheduled Commercial Banks   | 1                                                                      | 2                                                                      |                                                                     |                                                                     |                                                                     |
| Micro Enterprises            | 67274                                                                  | 96266                                                                  | 55029                                                               | 2002                                                                | 39235                                                               |
| Small Enterprises            | 30484                                                                  | 37660                                                                  | 24540                                                               | 172                                                                 | 12948                                                               |
| Medium Enterpises            | 3045                                                                   | 3356                                                                   | 1336                                                                | 23                                                                  | 1997                                                                |
| Total MSMEs                  | 100803                                                                 | 137282                                                                 | 80905                                                               | 2197                                                                | 54180                                                               |