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

The Ministry plans to notify a fresh classification of a class of enterprises under section 7 of the MSMED Act, 2006. Which step must the Central Government take before classifying?

Before classifying any class or classes of enterprises, the Central Government must obtain the recommendations of the Advisory Committee. The Act requires no approval from every State Government and no written consent from enterprise associations for this step.

  1. AObtain the recommendations of the Advisory CommitteeCorrect
  2. BObtain the approval of every State Government
  3. CObtain the consent of the associations of enterprises in writing
  4. DFile a memorandum with the authority specified by the State Government

Explanation

Section 7(4) requires the Central Government, before classifying any class of enterprises, to obtain the recommendations of the Advisory Committee. There is no requirement of approval from every State Government, so option B is wrong. The memorandum is filed by enterprises, not by the Government.

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