MUMBAI, Sept 17 (NNN-PTI) – India revised the monetary threshold for small companies, in terms of paid-up capital and turnover, to 0.5 million U.S. dollar and five million dollars, respectively, a circular by the country’s Ministry of Corporate Affairs (MCA), said yesterday.
The objective of raising the threshold limit for small companies, which earlier was 0.25 million dollars and 2.5 million dollars for paid-up capital and turnover, is to reduce their compliance burden and facilitate ease of doing business for them, said the MCA circular.
Welcoming the change, Makarand Joshi, founding partner of MMJC and Associates, a corporate compliance firm, said, “The relaxation in paid-up capital will allow around 80-90 percent of the total registered companies to fall under this category.”
Apart from bringing ease in doing business for newly added companies in the small category, they will also pay less filing fees and reduced penalties, and also enjoy relaxation in seven important sections/compliances, Joshi said.
Welcoming the relaxation in threshold limit, Vijay Kalantri, chairman of MVIRDC World Trade Centre, Mumbai, said, “It will reduce cost of doing business for many medium-sized enterprises, who are working on thin margins, especially at this time of rising input cost and disruption in supply chain, that are posing existential challenge to small enterprises.”
Small companies represent the entrepreneurial aspirations and innovation capabilities of citizens, and contribute to growth and employment in a significant manner, the MCA circular said.– NNN-PTI
