ENTREPRENEUR SUPPORT SCHEME (ESS) 2012
Guidelines
Background
Government of Kerala had approved and
implemented the following schemes viz. : the Scheme for payment of grant under
Women’s Industries Programme as per G. O. (Ms.) No. 56/80/ID dated 28.2.1980,
as per G. O. (Ms.) No. 170/93/ID dated 28.12.1993 the Scheme for providing
Margin Money Loan to SSI Units, as per G. O. (Ms.) No. 102/95/ID dated 6.7.1995
the Scheme for providing Margin Money Loan to SSI Units promoted by
Non-resident Keralites, as per G. O. (Ms.) No. 92/2000/ID dated 11.7.2000 the
Scheme for providing State Investment Subsidy, as per G. O. (Ms.) No. 2/2003/ID
dated 2.1.2003 the Scheme for subsidy under Technology Development Fund, as per
G. O. (Rt.) No. 920/2011/ID dated 27.7.2011 the Scheme for reimbursement of One
Time Guarantee Fee and Annual Service Fee remitted under CGTMSE, as per G. O.
(Rt.) No. 925/2011/ID dated 28.7.2011 the Self Employment Scheme for Educated
Youth, as per G. O. (Rt.) No. 926/2011/ID dated 28.7.2011 the Women Industries
Scheme and as per G. O. (Rt.) No. 941/2011/ID dated 1.8.2011 the Scheme for
providing Turn Over Subsidy to Micro, Small and Medium Enterprises engaged in
the manufacture of Fruit and Vegetable based products.
The ESS aims to merge and replace
all the previous schemes titled the Entrepreneur Support Scheme 2012 to be
operated in the State of Kerala
with the following objectives from 01.04.2012.
Objectives
The new
Entrepreneur Support Scheme intends to
(i)
provide extensive
support to micro, small and medium enterprises and
(ii) give one time support to entrepreneurs, with due
regard to special categories by optimal
utilisation of funds and giving more flexibility of operation while implementing the Scheme.
These guidelines, approved by the
Government of Kerala, intend to simplify and explain the modalities of filing
the Entrepreneur Support Scheme in the following modality.
Role of Industries Department
The Directorate of Industries & Commerce is an implementing agency of
Micro, Small and Medium Enterprise related policy decisions of the Industries
Department of Government of Kerala. The Directorate
along with its subordinate field offices viz. District Industries Centres and
Taluk Industries Offices are responsible for promoting/sponsoring, registering,
financing and advising MSME (Micro Small and Medium Enterprise) industries in
the State.
The role of the Department is to act as a facilitator for industrial
promotion and gives all assistance to start and sustain the MSMEs (Micro, Small
or Medium Enterprise).
The major functions of the
Department are:-
1.
Identify
entrepreneurs and motivate them.
2.
Provide project ideas/project profiles/project
feasibility advice/business management advices/guidance.
3.
Give appropriate technology sourcing/knowhow/evaluation/tie
ups with national and international partners.
4.
Provide information on the availability of
infrastructure/market/machinery details & suppliers/raw material source
& dealers.
5.
Conduct
Seminars/Entrepreneurship Development Programmes/Exhibitions to assist stakeholders.
6.
Issue due Acknowledgement
for applications filed by MSM Enterprises.
7.
Provide all requisite handholding services to the unit
to start operation and meet statutory requirements.
8.
Extend facilitation and personal supervision service
for project clearances/ documentation.
9.
Act as a liaison with financial institutions/other
departments/agencies.
10. Prepare and forward Technical
Feasibility Reports to Financial Institutions for Loan.
11. Assist the unit to get necessary
licenses/clearances/NOC from statutory bodies through Green Channel Counter/Single
Window Clearance Board.
12. Extend financial assistances to the unit
under the different schemes undertaken by Government to promote
Industrialisation.
13. Organise/assist Entrepreneurship
Development Clubs in Schools/Colleges to promote industrial culture among the
youth.
14. Identify and revive sick units under
Sick Unit Revival Programme.
15. Assist revival of industrial Clusters
and co-operative societies.
16. Implement other department/Government of
India
schemes.
17. Acquire, develop land for the benefit of
entrepreneurs by establishing Industrial Development Plots/Areas/MIEs.
18. Act as a sounding board for the
industrialists in the various forums.
19. Issue all essential documentation to the
industry to run/acquire assets/procure controlled items for industrial purpose.
20. Create and
extend infrastructural requirement for the development of industries.
21. Promote
Entrepreneurship.
22. Care
for the environment while promoting industry.
The first line executive officer of
the Department viz. The Industries Extension Officer who works in the Block
Level acts as the main facilitator for the industrialists. The Industries
Extension Officers shall:-
- Identify potential entrepreneurs by conducting congregation, Seminars, Entrepreneur Development Programmes, workshops, investors meet and disseminate information about the ESS.
- Educate the financial institutions in his/her bock/area of jurisdiction on the various aspects of the ESS.
- Assist the entrepreneurs to obtain the necessary documentation for applying for assistances under ESS.
- Assist the entrepreneurs to fill up the application for ESS and submit the application with all requisite documents.
- Follow up with the beneficiaries and watch out the progress of their functioning.
Part 1
Definition and explanation
1. The definitions for the terms mentioned
in this Manual are used only for the purpose of this Scheme and not applicable
elsewhere.
(i)
Entrepreneur: A person who has filed Entrepreneur Memorandum
as per MSMED Act 2006 before the Industries Department and has taken effective
steps to set up an industrial unit. (For the purpose of this scheme “effective
steps” means purchase of land, apply for bank loan, placing orders for purchase
of machinery or other demonstrable event in the life cycle of an industry.
(ii)
Enterprise : An industrial unit falling under
Micro, Small or Medium category in the MSMED Act 2006.
(iii)
Women enterprise: An enterprise in which at least 50% of the
promoters are women.
(iv)
Young entrepreneur: An entrepreneur between the age of 18
and 45. In case of more than one promoter, then to be eligible for assistance
under this Scheme, all the promoters shall be between the age of 18 and 45. At
the time of filing application for assistance under Entrepreneur Support
Scheme, the entrepreneur (s) should have attained 18 years of age as on the 1st
April of the concerned financial year and should not have attained 46 years of
age as on the 1st April of the concerned financial year.
(v)
Scheduled Caste and Scheduled Tribe entrepreneur: An
entrepreneur belonging to Scheduled Castes or Scheduled Tribes under The
Constitution Amendment (Scheduled Castes) Order, 1950/The Constitution
Amendment (Scheduled Tribes) Order, 1950 (as amended by Scheduled Castes and
Scheduled Tribes Orders (Amendment) Act, 1976. In case of more than one
promoter, then to be eligible for assistance under this Scheme, at least 50 %
of the promoters shall be SC/ST.
(vi)
Negative List: List of
Industries declared by Government from time to time, which are not to be
encouraged by giving any Government financial assistance.
(vii)
‘Pucca’ building: Buildings used exclusively for industrial
purpose; designed to be solid and permanent;
built of substantial material such as stone, brick, cement, concrete with RCC
roof.
(viii)
‘Semi pucca’ building: Buildings built without substantial
material such as stone, brick, cement, concrete and without RCC roof. In some such
cases the building roof will be on four pillars without side walls.
(ix)
Non-conventional
energy: Non-conventional sources of energy comprise those energy sources that
are natural, inexhaustible as well as renewable viz. wind, tidal, solar,
geo-thermal heat, biomass including farm and animal waste. (Hydro, coal,
mineral oil, natural gas etc are conventional energy sources).
(x)
New Technology:
Technology developed and transferred by recognized institutions.
(xi)
Recommending Authority:
Kerala Financial Corporation in case of units financed by KFC and Kerala State
Industrial Development Corporation in case of units financed by KSIDC. In all
other cases, the recommending authority shall be the respective General
Manager, District Industries Centres. The recommending authority shall accept
applications, receive due application fees, process the applications, place
them before the sanctioning authority and disburse the assistance.
(xii)
Sanctioning authority: General Manager, District
Industries Centres in case of assistance for Startup support. The District
Level Committees in case of Technology Support and the District/State Level
Committees in case of Investment Support.
(xiii)
Bio degradable plastic: Plastics that
will decompose
in natural aerobic (composting) and anaerobic (landfill) environments.
(xiv)
Plastic waste recycling: Process of recovering
scrap or waste plastic
and reprocessing the material into useful products sometimes completely
different in form from their original state.
(xv)
Bio fertilisers: A substance which contains living microorganisms
which, enrich soil fertility and fulfill plant nutrient
requirements by supplying the organic nutrients through microorganism and their
by products.
Part 2
Eligibility for applicants
2. All Micro, Small and Medium Enterprises
engaged in manufacturing activities and set up in the State, which had filed Entrepreneurs
Memorandum Part 1/II with the respective General Manager, District Industries Centre
shall be eligible for this assistance. The applicant has to
(a) apply in the prescribed
Proforma,
(b) provide necessary
documentation and accounts and
(c) execute an agreement with
the notified authority to avail the assistance.
For the purpose of this scheme an industrial unit eligible for the
Entrepreneur Support assistance shall be an independent legal entity.
Part 3
Entitlement of a successful applicant
3. Entitlement in the scheme shall be
limited to an amount of Rs. 30.00 (Thirty) lakhs per applicant unit to be
availed only once. The upper limit of
Rs. 30.00 (Thirty) lakhs shall be enhanced by 5% per annum during the period of
operation of the scheme to address the escalation of costs. Subject to this maximum limit the assistance
shall be limited to the fixed percentage of the composite investment upon
(a) land,
(b) land development costs,
(c) building and improvement
charges on existing building,
(d) essential office
infrastructure,
(e) fixed cost of plant and
machinery,
(e) electrification,
(f) generators and associated
equipment e.g. invertors
All testing and pollution
control equipments shall also be eligible for computing the composite
investment cost. Working capital and recurring costs shall not be eligible.
4. Out of all eligible applicants, 30% of
the earmarked assistance shall be reserved for micro enterprises. Only in case
of insufficiency of qualified applicants in the micro category, small and
medium enterprises shall be considered. The following categories of applicants
shall be preferred in the manner mentioned in the following paragraphs.
5. An assistance of 15% limited to Rs. 20.00
(Twenty) lakhs will be payable on the fixed capital investment of all micro, small and medium enterprises
set up in the State except those mentioned in paras 10 and 11.
6.
All micro, small and medium enterprises established by
entrepreneurs belonging to Women, Scheduled Castes and Scheduled Tribes and
Young entrepreneurs shall be eligible for an assistance of 20% of the fixed
capital investment limited to Rs. 30.00 (Thirty) lakhs.
7.
The following have been declared as priority industries
and all units, micro, small, medium enterprises included under priority sector
shall be eligible for an additional assistance of 10% of the fixed capital
investment subject to a ceiling of Rs. 10.00 (Ten) lakhs or as notified in the
specific incentives announced for the sector from time to time.
a)
Rubber based industries
b)
Agro based and food processing industries
c)
Readymade Garments
d)
Industries manufacturing equipments and machinery for Non-conventional
energy generation
e)
Bio Technology based industries
f)
100% Export Oriented Units
g)
Bio degradable plastic industries
h)
Plastic waste recycling industries
i)
Bio fertiliser industries
8.
In the case of all micro, small and medium enterprises
set up in the districts of Idukki, Wayanad, Kasaragode and Pathanamthitta,
there shall be an additional assistance of 10% of the fixed capital investment
subject to a ceiling of Rs. 10.00 (Ten) lakhs.
9.
In the case of micro, small and medium industrial units
set up after acquiring new technology from approved research institutions,
recognized as such by State or Central Government, there shall be an additional
assistance of 10% of the fixed capital investment subject to a ceiling of Rs. 10.00
(Ten) lakhs.
10.
Assistance to any unit which has already received any
subsidy or grant earlier under other schemes, from other Government Agencies,
any State owned financial institution shall be limited to the balance remaining
eligible assistance payable under the Entrepreneur Support Scheme. For eg. any
unit which has availed assistance from such agencies or statutory Boards like
MPEDA, Spices Board, Rubber Board, local bodies, etc. will be eligible for assistance
limited to the balance remaining eligible assistance payable under the
Entrepreneur Support Scheme. However an industrial unit which availed Margin
Money Loan from Industries Department is eligible for assistance under
Entrepreneur Support Scheme. In case the unit had availed start up support
earlier, only the balance remaining eligible assistance will be admitted to the
unit.
11.
The industries included in the Negative List and notified as such from time to
time, Government controlled industries, public sector undertakings, units
started by Government controlled agencies, units financed by KVIC/KVIB etc.
shall not be eligible for any assistance under these rules.
Part 4
Powers and Services offered by the
sanctioning authority
12. The power to sanction assistances under
the scheme shall be vested with the General Manager, District Industries
Centre, District Level Committee and State Level Committee with the following
composition.
13. District
Level Committee:-
District
Collector (Chairman); Lead District Manager; representative of Finance
Department in Government; District Manager, KFC; representative of KSSIA
District Committee and General Manager, District Industries Centre (Member
Secretary). Cases involving eligible fixed capital investment up to Rs. 200.00 (Two
hundred) lakhs only will be considered and sanctioned by District Level
Committee.
14. State Level Committee:-
Director of
Industries & Commerce (Chairman); representative of Finance Department in
Government; Managing Director, KSIDC; Managing Director, KFC; Director –MSME
(DI); Representative of KSSIA State Committee; Convenor, State Level Bankers
committee or representative and Additional Director of Industries and Commerce-General
(Member Secretary). Cases involving eligible fixed capital investment above Rs.
200.00 (Two hundred) lakhs only will be considered and sanctioned by State
Level Committee. In the case of State Level and District Level Committees the
quorum of the Committee shall be four.
15. It shall be the duty of the District Level
Committee to notify schemes at the commencement of the financial year through
press release/advertisement and accept applications year round. The
applications received in each calendar month directly in paper and
electronically will be processed electronically within the same quarter and
placed before the District Level Committee to be convened every month.
16. The recommending authority shall provide facility
to receive the application and application fee of Rs. 1,000.00 (One thousand)
per application either directly or electronically and issue receipt for the
same. In case of SC/ST, the fee shall be limited to Rs. 500.00 (Five hundred)
only. The Director of Industries & Commerce shall be competent to enhance
the fee from time to time not exceeding 10% at a time.
17. The recommending authority shall request
and accept further documentation or clarification required from the applicant, associated
agencies or stake holders of other departments. However, since the onus of the
genuineness and bonafides of the claim lie with the applicant unit, the
recommending authority need not resort to 100 % physical inspection/
verification of all applicant units, but may undertake a random verification. The
Director of Industries & Commerce will separately issue guidelines for
cases which require inspection or direct verification. The agency responsible
for processing application for investment support shall also be answerable to
Audit.
18. The recommending authority shall post the
information regarding each individual applicants and inform the outcome of the
application directly or electronically at the end of the quarter. The decision
of sanctioning authority shall be intimated to the party electronically within
24 hours and disburse the eligible assistance via the bank account of the
applicant unit within 48 hours of the sanctioning and execution of the
requisite agreement. In case the sanctioned amount is not disbursed within the
stipulated time, then the recommending authority shall obtain the approval of
the next higher authority.
Part 5
Obligations of the applicant
entrepreneurs
19. The
applicant shall provide all required details and declare such information as to
be true.
20. The applicant shall pay the requisite application
fee as stated in para 16.
21. The
applicant shall provide clarifications or further details sought by the recommending/sanctioning
authority.
22. The
applicant shall allow inspection or verification of any details mentioned in
the application including plant and machinery and all other assets if so
required by the recommending/sanctioning authority.
23. The
applicant shall produce originals of any important documents if so required by
the recommending/sanctioning authority for verification.
24. The
applicant shall execute requisite legal agreement online and if required on
paper as and when the proposal is approved for implementation and furnish the
signed hard copy subsequently via post or otherwise.
25. The
applicant shall utilise the amount received only in the manner agreed upon.
26. The
applicant shall operate the unit as stipulated in the agreement in which the
quantum of support received failing which the assistance shall be resumed by restoring
the provisions of Kerala Revenue Recovery Act.
27. The applicant unit after availing the
assistance shall furnish copies of
balance sheets, valid license from
local body, electricity bills, performance particulars in the prescribed proforma etc every year till the
stipulated period before the 31st December of the next financial year, as proof of their functioning to
the notified authority.
Part 6
Elements of Fixed Capital Investments
28. The principal elements of Fixed Capital
Investment such as land, land development costs, building, essential office
infrastructure, plant and machinery, electrification costs, testing equipment,
generator, other energy generating equipment, pollution control equipment and investments
on recycling of water, waste and rain harvesting if utilised for industrial
purpose shall be admitted for assistances under Entrepreneur Support Scheme on
the following basis. The Director of Industries & Commerce shall be
competent to declare a component as essential to the unit on a case by case
basis if differently titled.
29.
Land in the name of the unit, possessed and enjoyed by
them evidenced by title deeds and considered essential to the running of the
unit by the recommending authority shall be admitted for assistance. Land in
the name of the proprietor/partner or partners/Director or Directors of the
unit will also be considered for assistance as that of land in the name of
unit, provided it is capitalised in the books and accounts of the unit. The
stipulation of capitalisation in the books and accounts can be relaxed in the
case of proprietorship units. The purchase costs (including stamp duty and
registration charges) as per the deed or fair value of land whichever is lower shall
be taken as the value of land. In the case of land on lease for atleast 10
years the lease value of land limited to 20% of the fair value of the land
shall be admitted.
30.
Land development costs such as filling charges and
leveling charges shall be eligible for assistance upon certification by a Civil
Engineer not below the rank of an Assistant Executive Engineer of Government
Department (Industries, PWD, LSGD, Irrigation, etc) or a Chartered Engineer,
Institution of Engineers India/Approved Valuer of Institution of Valuers, India . The
investment in land development admitted for assistance shall be limited to a
maximum of 25% of the value of land admitted or valuation of the Engineer,
whichever is lower. Cases in which land is not admitted/eligible for
assistance, Land Development Costs are not admissible.
31.
Building essentially required by the unit including
improvements in the existing structure and situated in free hold land in the
name of the unit or in the name of the proprietor, Partner/Partners,
Director/Directors of the unit, if it is capitalised in the Books and Accounts
of the unit or in land on registered hire purchase or on lease to the unit for
at least ten years shall be eligible for assistance subject to a cost ceiling per
plinth area to be notified by the Director of Industries & Commerce from
time to time. Building on land acquired on lease, where the lease deed for land
has been executed/registered after the date of commencement of commercial
production can also be considered for assistance, provided the period of lease
of land in which the building under consideration is located is at least for 10
years. The plan, estimate and valuation shall be certified by a Civil Engineer
not below the rank of an Assistant Executive Engineer of Government Department
(Industries, PWD, LSGD, Irrigation, etc) or a Chartered Engineer, Institution of
Engineers India/Approved Valuer of Institution of Valuers, India . Any
civil structure not essentially related to production process shall not be
eligible for assistance. However, civil construction for pump house, generator
room, canteen, toilets, compound walls etc. whichever is necessary for
production process, directly or indirectly, shall be eligible.
32.
All brand new identifiable items of essential office
equipments viz. Air conditioner, fax, telephone, over head projector,
computers, office furniture etc can be considered provided these costs are
evidenced by invoices, proof of payments and a valuation certificate of a
Mechanical Engineer not below the rank of an Assistant Executive Engineer of
Government Department (Industries, PWD, LSGD, Irrigation, etc) or a Chartered
Engineer, Institution of Engineers India/Approved Valuer of Institution of
Valuers, India.
33.
The investment in Land, Land Development Costs, Building
and Essential Office Equipments shall be limited to 50% of the total fixed
capital investment.
34. All brand new identifiable items of plant
and machinery including tools, jigs, moulds as well as material handling
equipments shall be eligible for assistance. Fabricated machinery shall be
supported by a valuation certificate of a Mechanical Engineer not below the
rank of an Assistant Executive Engineer of Government Department (Industries, PWD,
LSGD, Irrigation, etc) or a Chartered Engineer, Institution of Engineers
India/Approved Valuer of Institution of Valuers, India . Plant and machinery on hire
purchase from National Small Industries Corporation shall be eligible for
assistance on the basis of original value. Generator sets, other energy
generating equipments shall also be considered as part of machinery for the
purpose of computing the investment for assistance. No commercial or private
vehicles, second hand machinery, crates, pallets and consumables, stores and
items not directly involved in production process will be eligible for
assistance.
35. All testing equipments will be eligible for
assistance at the rates specified for each category as mentioned in paras 5
& 6 if supported by a valuation certificate by a Mechanical Engineer not
below the rank of an Assistant Executive Engineer of Government Department
(Industries, PWD, LSGD, Irrigation, etc) or a Chartered Engineer, Institution
of Engineers India/Approved Valuer of Institution of Valuers, India. Claim on
this account can be considered independently without having to be a part of
new, expansion, diversification and modernisation project. In any case the
total eligible assistance including the assistance for testing equipments shall
not exceed the maximum ceiling eligible specified for each category.
36. All pollution control devices supported
by consent letter of Kerala State Pollution Control Board and valuation
certificate by a Mechanical Engineer not below the rank of an Assistant
Executive Engineer of Government Department (Industries, PWD, LSGD, Irrigation,
etc) or a Chartered Engineer, Institution of Engineers India/Approved Valuer of
Institution of Valuers, India shall be eligible for assistance at the rates
specified for each category as mentioned in paras 5 & 6. Claim on this
account can be considered independently without having to be a part of new,
expansion, diversification and modernisation project. In any case the total
eligible assistance including the assistance for pollution control devices
shall not exceed the maximum ceiling eligible specified for each category.
37. Power connection costs to KSEB except
security/caution deposit, transformer costs and costs of Industrial wiring
including that for Generator Set will be eligible for assistance. These costs
should be evidenced by invoices, proof of payments, and where industrial wiring
costs and electrification exceeds Rs. 50,000.00 (Fifty thousand) by a
certificate of valuation from an Electrical Engineer not below the rank of an
Assistant Executive Engineer, Electrical Inspectorate/Kerala State Electricity
Board or Chartered Engineer, Institution of Engineers India/Approved Valuer of
Institution of Valuers, India .
Power connection costs to KSEB, paid in instalments shall be eligible in toto
upon certification.
38. All investments on recycling of water,
waste and rain harvesting if utilised for industrial purpose shall be admitted
for assistance if evidenced by invoices, proof of payment and a valuation
certificate by a Civil or Mechanical Engineer not below the rank of an
Assistant Executive Engineer of Government Department (Industries, PWD, LSGD,
Irrigation, etc) or a Chartered Engineer, Institution of Engineers
India/Approved Valuer of Institution of Valuers.
39. In case the total fixed capital
investments claimed is less than Rs. 1.00 (One) lakhs, a valuation certificate
from an Officer of Industries Department not below the rank of an Industries
Extension Officer is sufficient. Transportation and erection charges shall not
be taken for the purpose of computing assistance.
Part 7
General provisions
40. The assistance under the Entrepreneur
Support Scheme shall be released to the eligible entrepreneur (s)/unit in 3
stages. The 1st stage is named Startup Support, 2nd stage
the Investment Support and the 3rd stage, the Technology Support. The
Startup support is provided for enterprises prior to commencement of commercial
production; Investment Support after the commencement of commercial production
and Technology Support after commencing production on acquiring new technology.
41. All applications for assistance under
Entrepreneur Support Scheme shall be submitted online by the applicant through
the designated website of Industries Department and produce the originals along
with details of acknowledgement received at the time of filing online, before
the Recommending Authority.
42. The Officer while accepting the application
form should examine whether all necessary details have been furnished. If any
information is found inadequate, the same should be intimated to the applicant unit
both electronically and otherwise and grant 10 days time to rectify the
defects.
43. A Committee shall be constituted in all
offices of the Recommending Authorities who shall monitor all units which avail
assistances under this Scheme to verify whether they satisfy the provisions of
this Manual. Any verification of the utilisation of the assistance granted may
preferably be made through the financial institution which financed the
applicant unit. A unit which avails assistance under this Scheme shall also be
under the obligation to furnish copies of balance sheets, valid license from local
body, electricity bills, performance particulars in the prescribed proforma etc
every year till the stipulated period before the 31st December of
the next financial year, as proof of their functioning.
44. Any dues on any account of the unit to
Government/agency of Government shall be adjusted from the amount sanctioned as
eligible assistance to any unit before disbursement of the assistance.
Government in the Industries Department will have powers to relax this
condition with the concurrence of Finance Department in exceptional cases for
the reasons reported by the Director of Industries & Commerce.
45. The disbursement of the sanctioned
assistance to the unit shall be by electronic transfer to the bank account of
the unit. The Director of Industries and Commerce shall open an account in a
nationalised/scheduled/private/any other bank into which the funds earmarked
for ESS for the financial year shall be parked. Each recommending authority
shall open a similar bank account with the prior approval of Director of
Industries & Commerce. Based on the request of the recommending authority
funds will be transferred on a quarterly basis to the bank accounts of the
recommending authority. The recommending authority shall disburse the
assistance to the entrepreneurs from their bank account to the bank account of
the enterprise, based strictly on their seniority. Each recommending authority
shall furnish an Utilisation Certificate towards the fund received on a
quarterly basis to the Director of Industries & Commerce.
46. Startup
Support: In case of all entrepreneurs who have been sanctioned Term
Loan by any Financial Institution against a definite Project Report recommended
and forwarded by Industries Department and approved by the Financial
Institution, for setting up an industrial unit, the eligible assistance at the
rates specified for each category as mentioned in paras 5 to 8 above shall be
released to the entrepreneur subject to the following conditions:-
(i)
The assistance shall be limited to 50% of the eligible
assistance under each category as mentioned in paras 5 to 8.
(ii)
The maximum startup support shall be limited to Rs.
3.00 (Three) lakhs.
47. An entrepreneur who intends to avail the
startup support shall apply in duplicate before the General Manager, District
Industries Centre in the prescribed application form with the necessary
documents and copy of the Project Report. The General Manager shall thereafter within
15 working days prepare a Technical Feasibility Report of the Project and
forward the same to the concerned financial institution for sanction of
eligible Term Loan. After sanctioning the Term Loan, the financial institution
may furnish their recommendation in the prescribed format along with attested
copies of the Sanction Letter towards Term Loan and Project Report.
48. The General Manager, District Industries
Centre shall have full powers for sanctioning startup support. Sanction of the
startup support shall be in the prescribed format. An agreement in the
prescribed format shall be got executed on stamp paper worth Rs. 100/- by the
competent authority representing the unit before the payment effected in favour
of the unit. All claims shall be disposed of within 15 days from the date of
receipt of completed application failing which a penalty shall be paid to the
applicant unit.
49. Startup support can be disbursed to the
unit only through the financing institution concerned. The Bank/financing
institution shall disburse the amount to the unit on a pro-rata basis along
with the disbursement of term loan. The financial institution shall adjust the start
up support against the Principal amount of the Term Loan only.
50. In case of any reduction and refixation
of the loan/Fixed Capital Investment,
proportionate reduction shall be made on the assistance and balance unspent
amount, if any, shall be returned to the General Manager, District Industries
Centre forthwith by the bank/financing institution. However, the unit shall be
liable to pay the interest for the amount so returned by the financial
institution till it reaches the General Manager, District Industries Centre. In
any case the Bank/financing institution shall complete disbursement of the Term
Loan and the startup support amount released to them by the General Manager,
District Industries Centre within one year from the date of its receipt.
51. Entrepreneurs who receive the startup
support will be under obligation to commence commercial production of the unit
within one year from the date of receipt of startup support and remain continuously
working for five years from the date of commencement of commercial production.
Any delay in commencing commercial production after the stipulated one year
period, shall be intimated to the concerned General Manager, District
Industries Centre in writing by the unit within one month prior to the lapse of
the stipulated one year period. The maximum period of extension that can be
allowed by the General Manager, District Industries Centre shall only be three
months.
52. No collateral security or charge on
assets of the unit during the pendency of loan by the unit to financial
institutions or banks is required for this assistance. But Government shall
have a charge on the industrial assets of the unit, once the assistance is
released. The financing institution will advise the General Manager, DIC
concerned in writing of their intention of releasing the charges created in
their favour in case of full repayment or of taking over the unit in case of
default so as to ensure that the assets are not disposed off without the
knowledge of the Department if the action proposed is within the stipulated
five year period.
53. Investment
Support: All enterprises shall apply for investment support within one
year of commencement of commercial production. The District Level committee and
State Level Committee shall however be competent to condone delays in
individual cases on merits. The District Level Committee may condone delays
only up to a period of two years.
54. All applications shall be made to the respective
recommending authority only after starting commercial production. All eligible
investments as on date of application for assistance can be admitted for
investment support provided the same is envisaged in the original Detailed
Project Report irrespective of the date of commencement of commercial
production.
55. Enterprises undertaking expansion,
diversification and modernisation shall also be eligible for investment support
at the revised rates applicable to each sector. In the case of modernisation,
the eligible fixed capital investment for support shall be fixed after deducting
the higher of written down value or sale value of the scrapped items. In
computing the ceiling the investment support given to the unit, the time it
commenced production as a new unit and the course of its expansion etc.
including under Central/State Investment Subsidy Scheme shall be considered.
56. Expansion, diversification to be eligible
for investment support should be different from routing replacement. ‘
Modernisation’ refers to replacement of existing machinery with new machinery
partially or fully with the same make or with different make. The expansion,
diversification and modernisation should have been carried out as per a
definite project report, over a predefined period of time. While expansion,
diversification and modernisation must result in at least 25% increase in plant
and machinery in Gross Block terms, expansion must also result in at least 25%
increase in installed capacity.
57. Eligible investment support at the rates
mentioned in paras 5 to 8 above, shall be sanctioned to the unit by the
District/State Level Committee after deducting the assistances if any, availed.
However, the applicant unit shall be given an opportunity of being heard under
proper notice, before a decision is taken by the Committee. All claims shall be
disposed of within three months from the date of receipt of completed
application failing which a penalty shall be paid to the applicant unit.
58. Investment support shall be disbursed by
the recommending authority through the financing institution which has financed
the unit on their executing an agreement with the recommending authority in the
prescribed format. If there are more than one such financing institution the
amount shall be credited to the term loan lending institution.
59. Industrial units which receive the
investment support will be under obligation to remain working continuously for
five years from the date of commencement of commercial production. However, it
is necessary that a unit shall be a working one as on date of release of the
assistance. Closed down units are not eligible for this assistance.
60. Technology
Support:- All industrial units shall apply for Technology support
within six months from the date of commencement of commercial production after
installing the new technology. The District Level committee shall however be
competent to condone delays in individual cases on merits. The technology
support can be claimed by new units or existing units without being a part of
the diversification/expansion/modernization programme. The assistance shall be
payable for acquiring new technology at the rates mentioned in para 9 above.
61. The application for technology support
shall be filed before the Recommending Authority along with copies of invoices
of the machinery acquired in this regard with proofs of payment from the
research institutions owned or controlled by Government such as CFTRI, CSIR,
DFRL, DRDO, Rubber Board, CTCRI, ICAR, KVK etc. supported with proof towards the
payment of consultancy charges, valuation certificate of a Mechanical Engineer
not below the rank of an Assistant Executive Engineer of Government Department
(Industries, PWD, LSGD, Irrigation, etc) or a Chartered Engineer, Institution
of Engineers India/Approved Valuer of Institution of Valuers, India and
certificate from the research institutions that the technology is new.
Government Engineering Colleges approved by AICTE, institutions under the
Council of Science &Technology, universities etc which has Research &
Development facilities and which develops technologies for industry shall also
be considered as research institutions for the purpose of the Technology
Support.
62. Plant & Machinery for technology
upgradation, improvement in packaging, energy conservation and
consultancy/technology transfer costs etc shall be considered for this
assistance.
63. The Recommending Authority shall place
the application before the District Level Committee for Entrepreneur Support
Scheme as mentioned in para 13, for sanctioning technology support. However,
the applicant unit shall be given an opportunity of being heard under proper
intimation, before a decision is taken by the Committee. All claims shall be
disposed of within one month from the date of receipt of completed application
failing which a penalty shall be paid to the applicant unit. Sanction of the
technology support shall be in the prescribed format. An agreement in the
prescribed format shall be got executed on stamp paper worth Rs. 100/- by the
competent authority representing the unit before the payment is effected in
favour of the unit.
64. Entrepreneurs who receive the technology
support will be under obligation to remain continuously working for five years
from the date of commencement of commercial production after installing the new
technology.
Part 8
Appeals
65. The State Level Committee for
Entrepreneur Support Scheme is competent to dispose the appeals, if any,
received in the prescribed format against
the orders of the District/State Level Committee in case of
Investment/Technology Support and even competent to reconsider the decision of
the State Level Committee. The State Level Committee is also competent to issue
clarifications wherever necessary in respect of Entrepreneur Support Scheme. In
case of appeals against the orders of the General Manager, District Industries
Centres with regard to startup support the District Level Committee shall be
competent to dispose the same.
66. The Appeals referred in para 65 above
shall be filed within 90 days from the date of issue of orders of the General
Manager, DIC/District Level Committee/State Level Committee as the case may be
and sent to the Member Secretary of the District/State Level Committee
concerned. No appeal after this period will be entertained. The Member
Secretary shall place the case before the Committee after getting the views of
the recommending authority, if found necessary. The appeal shall be disposed
of, as far as possible, within three months from the date of receipt of appeal
after giving the appellant an opportunity of being heard, wherever necessary.
Part 9
Expenses
67. An amount of 2% of the budget allocation
under the scheme shall be earmarked and made available for disposal with the
Director of Industries & Commerce for allotting to the District/State Level
Committees towards administrative expenses and advertisement and publicity costs.
The expenses can be met for the purpose of canvassing applicants, hiring of vehicles,
associated telephone charges, printing and publishing publicity materials,
light refreshments for investor meets. The Director of Industries &
Commerce will determine the limits under which such expenses are to be footed.
68. The fees being collected by the
recommending authorities as application fees from the applicant unit may also
be utilised for both administrative expenses and advertisement costs. However
recommending authority/ Committees shall furnish expenditure particulars to the
Director of Industries every quarter and also publish the same in the website.
Part 10
Recoveries and Penalties
69. Any assistance viz. startup, investment
or technology support to an industrial unit is liable to be refunded by the
unit with interest at the rate of 14% per annum from the date of receipt of the
same, on issue of registered demand notice to the unit by the Recommending/Sanctioning
authority on grounds of obtaining assistance by mis-representation, forgery or
deception or not found working continuously for five years from its commercial
production or in case of units which availed startup support, if the unit is
not found to have commenced its commercial production within one year after
receipt of assistance. All amounts due to Government under this provision
shall, in case of default, be recoverable as if they are arrears of land
revenue under the provisions of the Kerala Revenue Recovery Act, 1968 or in
such other manner as Government may deem fit. Sufficient opportunity to show
cause in writing shall however be granted to the units before a demand is
raised against it.
70. If an authorised officer of the
Recommending/Sanctioning authority is found to have delayed processing of
application or disbursing of claim on approved cases deliberately, the Director
of Industries & Commerce shall be competent to levy and recover a fine of
Rs. 500.00 (Five hundred) per day for each day of such delay determined subject
to a maximum of Rs. 10,000.00 (Ten thousand) from the salary of the delinquent and
award it as cost to the applicant unit. An opportunity of hearing shall be
given to the officer concerned before such damages are realised. This shall not
count as disciplinary action under Kerala Civil Services (Classification, Control
& Appeal) Rules, 1960 etc.
Part 11
Forms
71. The application, other certificates, agenda
note, sanction letters, agreement etc. shown separately as annexures shall form
part of the Manual.
LIST OF ANNEXURES
I.
List of
Priority Industries
II.
Negative List
III.
Format of
the Application for assistance under Entrepreneur Support Scheme
IV.
Format of
Recommendation of the Financial Institution for Startup Support
V.
Format of
Proceedings to sanction Startup Support
VI.
Format of
the Agreement for Startup Support
VII.
Format of the Certificate of Valuation of the Engineer
towards Land Development Costs/Building
VIII.
Format of the Certificate of Valuation of the Engineer towards
Fixed Capital Investments
IX.
Format of
the Certificate of Valuation of the Engineer towards Electrification Costs
X.
Format of
the Agenda Note for sanctioning Investment Support
XI.
Format of
the Sanction Letter for Investment Support
XII.
Format of the Agreement for Investment Support
XIII.
Format of the Agenda Note for sanctioning Technology
Support
XIV.
Format of Proceedings to sanction Technology Support
XV.
Format of the Agreement for Technology Support
XVI.
Format for Appeal
XVII. Format
of the Performance Particulars of unit
ANNEXURE - I
The list of industries mentioned in
this annexure under priority sector is not exhaustive and industries may be
added from time to time, if found to be part of the respective sectors and part
of the priority sector.
1. RUBBER BASED
INDUSTRIES
(“Any industrial unit utilising
natural rubber as raw material cost of which is at least 25% of the total cost
or raw materials used for the manufacture of end product will be treated as
rubber based industries”. Natural rubber is ‘the form of latex, centrifuges,
latex, skimmed latex, scrump, creeps sheet or blocks (scrump) will be treated
as natural rubber’. Activities like powdering of rubber products are excluded
from this purview).
1. Rubberised
cloth
2. Canvas
hoses
3. All
tyres-cycle, cycle rickshaw and car, truck etc.
4. All
tubes, tubes flaps-cycle, cycle rickshaw and car, truck etc.
5. Camel
back Tyre
re-treading materials (except cold curing type materials procured)
6. Moulded
rubber soles and heals for footwear (except for captive consumption)
7. All
gloves – and other dipped goods
8. Hot
water bags – rubber
9. Ice
bags – rubber
10. Rubber
balloons & rubber bands
11. Rubber hose
12. Rubberised
canvas hose pipes
13. Rubber tubes
14. Rubber washers
15. Oil seals
rubber
16. Rubber thread
(except base rubber thread of ever heat resisting rubber thread)
17. Rubber eraser
18. Hard rubber
battery containers
19. “o” rings –
rubber and automobile rubber parts
20. Latex foam
& latex foam products (except synthetic rubber cots and aprons and lubricating pads)
21. Micro cellular
sheets
22. Other dipped
latex products except contraceptives
23. Spares for
medical and surgical apparatus and sweets.
24. Rubberised
coir mats, mattresses etc.
25. Centrifuged
latex
26. Rubber parts
for sports goods
27. Crape rubber,
crumb rubber, rubber belts (conveys and V bolts)
28. Rubber based
adhesives
29. Cables
30. Rubber tiling/flooring
31. Rubber mats
32. Latex based
adhesives
33. Latex threads
34. Toy balloons,
rubber band gloves
35. Automobile
rubber components
36. Rubber rollers
37. Rubberised
fabrics
38. Tyre flaps
39. Battery containers
40. Rubber backed
coir mats
41. Oil seals
42. Rubber
component for electronic industry
43. Hot water
bottles
44. Hospital and
industrial sheeting
45. Rubber play
balls
2. AGRO BASED AND
FOOD PROCESSING INDUSTRIES
AGRO BASED INDUSTRIES:
(Agro-based industries are those
industries which depend on agricultural products as raw materials)
1. Rice Mill
2. Oil and other products from coconut
3. Extraction of essential oil
4. Cattle feed and Poultry Feed
5. Starch manufacturing from Tapioca
6. Wheat powder
7. Raggy powder
8. Straw Board
9. De-fibering of coconut husk
10. Turmeric
powder
11. Ginger
oil/Oleoresins
12. Turmeric
oil
13. Curry
Powder
14. Bottling
of coconut water as soft drink/coconut milk/coconut cream/descicated coconut/coconut limca.
15. Coconut
shell powder
16. Coconut
hair oil
17. Banana
processing
18. Black
gram powder
19. Canning
of vegetables and fruits
20. Cashew
nut shell liquid
21. Clarified
fruit juices
22. Coffee
powder
23. Corn
flakes
24. De-hydration
of fruits and vegetables
25. Rice
Flakes (Aval)
26. Fruit
Bars
27. Groundnut
oil
28. Instant
pickles
29. Mushroom
processing
30. Wine/brandy
from cashew/apples/banana
33. White
pepper powder
34. Coconut
cream powder
35. Products
from coir fiber
36. Tapioca
rava
37. Activated
carbon
38. Fresh
milk processing other than dairy farm
39. Milk
powder
40. Tea
powder
FOOD PROCESSING INDUSTRIES:
(Any industry whose end products
is utilized for the consumption including processing purification and refining
of edible oils).
1. Ice cream
2. Pickles and chutneys
3. Vinegar
4. Dal Milling
5. Bread
6. Pastry
7. Confectionery
8. All edible oil milling processing and refining
9. Poultry feed, cattle feed except in pellet form
10. Ground
and processed spices
11. Tapioca
sago and other Tapioca products
12. Banana
Powder, chips and other products
13. Synthetic
syrups
14. Milling
and processing of spices & curry powder
15. Glucose
16. Soft
drinks
17. Fruit
preservation and processing
18. Semi
processed and packed food materials
19. Pappad
20. Fish
processing and curing
21. Meat
processing and preservation
22. Biscuits
23. Instant
noodles
24. Bakery
and allied products
25. Vermicelli
3. READYMADE GARMENTS
(Any industrial unit
manufacturing garments of any variety from cotton, synthetic and blended fibre,
silk and wool will be treated as a garment, manufacturing unit)
4. INDUSTRIES
MANUFACTURING EQUIPMENTS AND MACHINERY FOR NON-CONVENTIONAL ENERGY GENERATION
(Industries which manufacture
equipments and machinery for generating power from non-conventional sources of
energy viz. wind, tides, solar, geo-thermal heat, biomass including farm and
animal waste)
5. BIO TECHNOLOGY
BASED INDUSTRIES
(Industries that involves the use
of living organisms and bioprocesses to develop products for manufacturing
purpose. Modern use of similar terms includes genetic engineering as well as cell
and tissue
culture technologies)
- Antibiotics
- Fermented beverages
- Fermented foods
- Recombinant proteins
- Biogas
- Biohydrogen
- Biopolymer
- BioSteel
- Butanol
- Ethanol fuel
6. 100% EXPORT
ORIENTED UNITS
(Units undertaking to export
their entire production of goods and service as per the Export – Import Policy)
7. BIO DEGRADABLE
PLASTIC INDUSTRIES
(Industries
that manufacture plastics
which will decompose
in natural aerobic (composting) and anaerobic (landfill) environments)
- Polyvinyl alcohol
- Polyhydroxyalkanoates (PHAs)
- Polylactic acid (PLA)
- Polybutylene succinate (PBS)
- Polycaprolactone (PCL)
- PLASTIC WASTE RECYCLING INDUSTRIES
(Industries that use the process of recovering
scrap or waste plastic
and reprocessing the material into useful products, sometimes completely
different in form from their original state)
- BIO FERTILISER INDUSTRIES
(Industries that produce bio
fertilizers. Bio fertilizers are substances that contain living microorganisms
which, enrich soil fertility and fulfill plant nutrient
requirements by supplying the organic nutrients through microorganism and their
byproducts)
- Rhizobium
- Azotobacter
- Azospirillum
- Blue green algae (BGA)
ANNEXURE - II
NEGATIVE
LIST*
Negative list: units which are ineligible for any financial
assistance/loan/exemption/ subsidy from the State Government
1. Service Enterprises
2. Photo
Studios and Colour Processing Centres
3. Tailoring
other than manufacturing of readymade garments
4. Breweries
and Distilleries of all types
5. Saw
mills
6. Soap
Grade Sodium Silicate
7. Asbestos processing except units in respect
of which the quantum of asbestos used in the production process is less than
25% and environmental and occupational health hazards have been taken care of
to the satisfaction of authorities concerned.
8. Metal
Crushers including Granite Manufacturing units
9. All
types of Steel Re rolling Mills, Units manufacturing iron ingots,
10. Calcium
Carbide
11. Cement
manufacturing except units manufacturing cement from fly ash
12. Potassium
Chlorate
13. Cashew
industrial units
14. Power intensive units
based on electro thermal/electro chemical processor units where total power
requirements exceeds 5000 KVA of contract load or where the cost of power is
more than 33% of cost of production of the items manufactured except where the
units generate their power requirement in excess of 5000 KVA of contract load
by own captive power.