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CS Executive · Setting Up of Business, Industrial and Labour Laws · Micro, Small and Medium Enterprises

A State Government is setting up a Micro and Small Enterprises Facilitation Council under the MSMED Act, 2006. Which statement about its composition is correct?

The Council consists of not less than three and not more than five members, and the Director of Industries, or an officer not below that rank, in the State department concerned is the Chairperson. Section 21 sets this, and Section 20 has the State Government establish it.

  1. AIt has not less than three and not more than five members, and the Director of Industries (or an officer not below that rank) is ChairpersonCorrect
  2. BIt has exactly seven members, and a bank representative is Chairperson
  3. CIt has not less than five members, and the senior-most association representative is Chairperson
  4. DIt has not more than three members, appointed by the Central Government

Explanation

Section 21(1) provides for not less than three but not more than five members drawn from the specified categories. Section 21(2) makes the person appointed under clause (i), the Director of Industries or officer not below that rank, the Chairperson. Section 20 shows the State Government establishes the Councils, so a Central Government appointment is wrong.

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