This PPT Talks about Legal Formalities for MSME or Business. this will guide what documents needed for starting new business for various sector.

1. M A H A R A S H T R A C E N T E R F O R E N T R E P R E N E U R S H I P D E V E L O P M E N T, N A G P U R
Training on Technical EDP
LEGAL FORMALITIES FOR STARTING
MSME OR ENTERPRISE
By
Mr. Vijay R. Joshi
Income Tax & GST Practioneer

2. Legal forms of businesses in India
The legal form a firm chooses to operate under is an
important decision with implications for how a firm
structures its resources and assets. Several legal forms
of business are available to entrepreneurial business
owners. Each involves a different approach to dealing
with profits and losses. There are mainly three types
of business organization in terms of law.
The required legal processes and needed documents differ in case of each form of business, all of
these types of businesses are usually aimed at being profitable in the short and long term

3. Legal forms of businesses in India

4. Legal forms of businesses in India
Sole Proprietorship :- A sole proprietorship is an unincorporated company that is owned by one
individual only. While it is the most simple of the types of businesses, it also offers the least
amount of financial and legal protection for the owner. Unlike partnerships or corporations, sole
proprietorships do not create a separate legal identity for the business. Essentially, the owner of
the business shares the same identity as the company. Therefore, the owner is fully liable for any
and all liabilities incurred by the company.

5. Legal forms of businesses in India
Sole Proprietorship :-

6. Legal forms of businesses in India
Partnership:- As the name states, a partnership is a business owned by two or more people,
known as partners. Like sole proprietorships, partnerships are able to take advantage of flow-
through taxation. This means that the income is treated as the owners’ incomes so it is only taxed
once. Owners in partnerships are responsible for the liabilities of the firm. However, there are
some nuances to this. There are different types of partnerships: General Partnerships, Limited
Partnerships, and Limited Liability Partnerships.

7. Legal forms of businesses in India
Partnership:-

8. Legal forms of businesses in India
Company:- A company is a legal entity formed by a group of individuals to engage in and
operate a business commercial or industrial enterprise. A company may be organized in various
ways for tax and financial liability purposes depending on the corporate law of its jurisdiction. A
company is essentially an artificial person—also known as corporate personhood—in that it is an
entity separate from the individuals who own, manage, and support its operations. Companies are
generally organized to earn a profit from business activities, though some may be structured as
nonprofit charities. Each country has its own hierarchy of company and corporate structures,
though with many similarities.

9. Legal forms of businesses in India
Company:-

10. Legal Requirements for doing business
General Requirements:
Permanent Account Number / Aadhar Number
Shop and Establishments license (License for physical premises)
GST registration
Specialized Requirement:
MSME
Labour License
ESIC / PF
FSSAI License (To start a food business) etc.

11. Legal Requirements for doing business
Permanent Account Number:- Permanent Account
Number or PAN is a means of identifying various
taxpayers in the country. PAN is a 10-digit unique
identification alphanumeric number (containing both
alphabets and numbers) assigned to Indians, mostly to
those who pay tax. PAN Card too is given by the Income
Tax Department. While PAN is a number, PAN Card is a
physical card that has your PAN as well as name, date of
birth (DoB), and photograph. Copies of this card can be
submitted as proof of identity or DoB.

12. Legal Requirements for doing business
Aadhar Number:- An Aadhaar card is a
unique number issued to every citizen in
India and is a centralized and universal
identification number. The Aadhar card is a
biometric document that stores an
individual's personal details in a government
database, and is fast becoming the
government's base for public welfare and
citizen services.

13. Legal Requirements for doing business
Shop and Establishments license / Gumasta:-
The shop licence refers to a type of legal permission that
legally allows people to do business in a particular place.
If any individual has a physical shop or office, it is
essential to obtain a license. The license acts as proof of
a particular business being done at that place. The Shop
and Establishment Act in India is promoted by the state
governments, but it slightly varies from state to state. All
the shops and commercial establishments functioning
within a particular state are covered by this act.

14. Legal Requirements for doing business
Goods & Services Tax Registration (GSTIN):-
The goods and services tax (GST) is an indirect
tax that is applied to the cost of certain goods and
services. The business adds the GST to the price of
the product, and a customer who buys the product
pays the sales price inclusive of the GST. The GST
portion is collected by the business or seller and
forwarded to the government. It is also referred to
as Value-Added Tax (VAT) in some countries.

15. Legal Requirements for doing business
Taxes Abolished after Goods & Services Tax
Act:-

16. Legal Requirements for doing business
Types of GST:-
Types of
GST
CGST
SGST
IGST
UTGST

17. Legal Requirements for doing business
Micro, Small and Medium Enterprises [MSME]:-
Government of India enacted the Micro, Small and Medium
Enterprises Development (MSMED) Act, 2006. It became
operational on October 02, 2006. It was established to
promote, facilitate and develop the competitiveness of the
micro, small and medium enterprises. For deciding the
applicability of the MSMED Act, the government has
prescribed specific turnovers and investment limits to reckon
whether an enterprise falls under the micro, small or
medium category.

18. Legal Requirements for doing business
UDYOG AADHAAR NUMBER:-
Once you get MSME registration, you will
receive a Certificate of the MSME registration
wherein a 12 digit unique number is mentioned.
Once you get this 12 digit Udyog Aadhar
Number for your Micro, Small or Medium
Scale Industry, you have MSME registration in
your hands.

19. Legal Requirements for doing business
Benefits of Micro, Small and Medium Enterprises [MSME]:-

20. Legal Requirements for doing business
Food Safety and Standards Authority of India
(FSSAI)
Food Safety and Standards Authority of India (FSSAI) is a
statutory body established under the Ministry of Health &
Family Welfare, Government of India. The FSSAI has
been established under the Food Safety and Standards Act,
2006, which is a consolidating statute related to food
safety and regulation in India. FSSAI is responsible for
protecting and promoting public health through
the regulation and supervision of food safety.

21. Legal Requirements for doing business
Benefits of FSSAI

22. Legal Requirements for doing business
Types of FSSAI

23. Legal Requirements for doing business
Employee Provident Fund Organization (EPFO) :- The Employees’ Provident Fund
Organization (EPFO) is a non-constitutional body that promotes employees to save funds for
retirement. The organization is governed by the Ministry of Labour and Employment,
Government of India and was launched in 1951.
The schemes offered by the organization cover Indian workers and international workers (from
countries with whom the EPFO has signed bilateral agreements)

24. Legal Requirements for doing business
EPFO Benefits

25. Legal Requirements for doing business
Factory License :- As per the Factory Act 1948 it is mandatory for every factory owner to
register their premises with the local authorities before commencing their business. Factory
License acts as a document of approval given by authorities to carry out manufacturing activities.
Department of the Factories and Boilers issues Factory License. It is the duty of Factories and
Boilers Department to keep a check on the health, safety and welfare of workers.
Factories Act 1948, says that a factory must obtain its building plan approval from the labor and
employment department before covering themselves for a factory registration. Under this act,
registration and renewal of the Factory license are also done to ensure the safety of workers.

26. Legal Requirements for doing business
Labour License :- It applies to any establishment in which twenty or more workmen are
employed on any day of the of the accounting year as contract labour. It applies to any contractor
who employs or who employed twenty or more workers on any day of the accounting year.
The Contract Labour (Regulation and Abolition) Act 1970 applies to the following entities:
It applies to any establishment or Contractor in which twenty or more workmen are employed
on any day of the of the accounting year as contract labour.
It does not apply to the establishments if any work not performed for more than one-twenty days
in a year or establishments situated in the special economic zone(SEZ).
It does not apply to the establishments having seasonal nature for more than sixty days in a
year.

27. Thank You !
Mr. Vijay R. Joshi [CA-Final, M.com, MBA(Pursing)
E-mail: vrjoshi18@gmail.com
Twitter: @vrjoshi18
WhatsApp: +91 7020293381