The government announced creation of ‘Distressed Assets Fund- – Subordinate Debt for Stressed MSMEs’ on 13th May 2020, under the Aatma Nirbhar Bharat Package.
Accordingly, a scheme viz Credit Guarantee Scheme for Subordinate Debt’ was approved by the Government on 1st June, 2020 and the scheme was launched on 24th June, 2020 to provide credit facility through lending institutions to the promoters of stressed MSMEs viz. SMA-2 and NPA accounts who are eligible for restructuring as per RBI guidelines on the books of the Lending institutions. Initially the scheme was upto 31.03.2021.
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In order to keep the avenues of assistance to stressed MSME Units open, the Government had earlier extendef the scheme.
On the basis of the requests received from the stakeholders of the scheme, the Government has decided to extend the scheme.
The eligibility criteria for the scheme are – New business and existing Micro and Small Enterprises engaged in manufacturing or service activity excluding Educational Institutions, Agriculture, Self Help Groups (SHGs), Training Institutions etc. As of now, all activities that come under the service sector as per MSMED Act, 2006 are eligible for coverage under the scheme.
Under the Scheme, a borrower is required to obtain IT PAN number prior to availing credit facility from the eligible lending institution, it is a mandatory requirement under section 139A(5) read with section 272(C) of the I.T Act 1961 to indicate IT PAN on all tax documents which include returns, challans, appeals, etc. However, in respect of loans up to 5 lakh, CGTMSE is presently not insisting that the IT PAN be obtained at the time of availing of the guarantee cover. IT Pan No. is to be indicated in respect of credit facility above 5 lakh.
Do visit – https://smeventure.com/can-automation-transform-msme-sector-of-india/