Aatmanirbhar Gujarat Scheme for Assistance to MSMEs: Assistance in Rent to MSEs

What is Assistance in Rent to MSEs under the Aatmanirbhar Gujarat Scheme?

Assistance in Rent to Micro and Small Enterprises is one component of the Aatmanirbhar Gujarat Scheme for Assistance to MSMEs, notified by the Industries and Mines Department, Government of Gujarat through Resolution No. MIS-102022-1271(1)-I(Ch) dated 5 October 2022 and administered by the Industries Commissionerate.

The component answers a specific problem. A small manufacturer starting out rarely owns a shed. Rent is a fixed monthly outgo from the first day, before the unit has any revenue, and it competes directly with money the promoter would otherwise put into machinery and raw material. Assistance in Rent to MSEs reimburses 65% of the rent actually paid, subject to a ceiling of Rs 1,00,000 per annum, and it does so for five years.

According to the scheme guideline published by the Industries Commissionerate, the operative period of the scheme is 05/10/2022 to 04/10/2027. Rent paid inside that window, under a deed inside that window, is what the scheme covers.

Key features

• Reimbursement, not an advance. The enterprise pays the rent first and claims afterwards.
• 65% of rent paid, capped at Rs 1,00,000 in any one year.
• Payable for five years, so the potential total is up to Rs 5,00,000.
• Restricted to manufacturing micro and small enterprises.
• Applied for on the Investor Facilitation Portal, ifp.gujarat.gov.in.

Who is eligible for rent assistance to MSEs in Gujarat?

Your enterprise qualifies if:

• It is classified as a micro or small manufacturing enterprise as defined in Para 1 of the Government Resolution dated 05/10/2022.
• It holds an acknowledgement or registration from the Ministry of MSME (Udyam) or from DPIIT, as the case may be.
• It has acquired a rented or leased shed or premises for manufacturing.
• It is in commercial production, not merely registered or under installation.
• Its rent is paid by cheque or e-payment.
• Its rent or lease deed is notarised or registered, runs for a minimum of 11 months (extendable up to 5 years), and falls inside the policy period.

Your enterprise is not eligible and cannot apply if:

• It is in service activity or trading activity. The guideline excludes both outright, whatever the size of the unit.
• It is a medium enterprise. This particular component is for micro and small enterprises only, even though the parent scheme covers MSMEs.
• The landlord does not have legal ownership and possession of the shed or premises being let out.
• It pays rent in cash, leaving no bank trail.
• It signed the rent agreement before 05/10/2022, commenced commercial production before 05/10/2022 and applied before 05/10/2022, the guideline specifically records this combination as not eligible.
• It applies more than one year after the date of the rent or lease deed.

Two transition situations are worth knowing. An enterprise that commenced commercial production before 05/10/2022 but signed the rent agreement after 05/10/2022 and applied after 05/10/2022 is eligible. An enterprise that commenced commercial production after 05/10/2022 but applied before 05/10/2022 has the option to opt as per Para 7 of the GR dated 05/10/2022.

How much is the rent assistance and how long does it run?

The guideline sets the quantum in two lines:

• 65% of the rent paid, released as reimbursement of rent already paid by the enterprise.
• Maximum Rs 1,00,000 per annum.
• For five years.

Worked through, a unit paying Rs 8,000 a month pays Rs 96,000 a year; 65% of that is Rs 62,400, comfortably under the cap, so the full Rs 62,400 is admissible. A unit paying Rs 20,000 a month pays Rs 2,40,000 a year; 65% is Rs 1,56,000, which is above the ceiling, so the claim is limited to Rs 1,00,000 for that year. Over five years the ceiling therefore puts the maximum lifetime benefit at Rs 5,00,000.

Assistance is counted from the date of the rent deed, or three months prior to the date of production, whichever is later. An enterprise that signed a deed in January and started production only in October cannot claim from January; the later of the two reference points applies.

An enterprise may file a maximum of three applications, with the total assistance still capped at Rs 1,00,000 per annum across them during the operative period. That provision exists so a unit that shifts premises or adds a second rented shed is not shut out, not so it can draw more than the annual cap.

How to apply for Assistance in Rent to MSEs

1. Complete your Udyam registration with the Ministry of MSME (or DPIIT registration, as applicable) and keep the acknowledgement number ready.
2. Get the rent or lease deed notarised or registered for a minimum of 11 months, and start paying rent by cheque or e-payment from the first month.
3. Register and log in on the Investor Facilitation Portal at ifp.gujarat.gov.in, the Gujarat government's single window for industrial incentives.
4. Open the Aatmanirbhar Gujarat Scheme for Assistance to MSMEs and select the Assistance in Rent to MSEs component.
5. Fill the application with enterprise details, Udyam number, premises details, the deed date, monthly rent and the date of commencement of commercial production.
6. Upload the documents: deed, ownership proof of the landlord, rent payment evidence, production proof, premises approvals and bank details — and submit the form online.
7. Print the submitted application, self-certify the hard copy and submit it at the concerned District Industries Centre within one year from the date of the rent or lease agreement. Obtain a dated receipt.

The guideline also allows an offline route: until the online module is live, an enterprise can apply or submit the hard copy at the concerned DIC office directly. Where an enterprise changes its rented premises, it must give prior intimation to the concerned DIC.

How do you check the status of a rent assistance claim?

1. Log in to ifp.gujarat.gov.in with the credentials used to file the application.
2. Open the application dashboard and read the stage against your application number; submitted, scrutiny, query, inspection, sanction or disbursement.
3. Respond to any query raised by the District Industries Centre within the time given, uploading the exact document asked for.
4. After sanction, check that the reimbursement is credited to the enterprise's bank account, and reconcile it against the year claimed.

The District Industries Centre of the district where the premises are located holds the physical file, and is the office to visit if the portal shows no movement.

Why rent assistance claims get rejected

• Trading or service activity. The single most common ground; the unit must be manufacturing.
• Rent paid in cash, so the 65% cannot be verified against a bank trail.
• Unregistered or un-notarised deed, or a deed shorter than 11 months.
• Application filed beyond one year from the date of the deed.
• The landlord's title is unclear, the owner must have legal ownership and possession.
• Sub-lease without an NOC from the recognised institution or authority.
• Production not commenced, so the unit does not meet the commercial production condition.
• Premises approvals missing, which the guideline requires the enterprise to submit.

Where do you raise a grievance about the rent assistance scheme?

• First level: the General Manager, District Industries Centre for the district in which the rented premises are located.
• Second level: the Industries Commissionerate, Gandhinagar, through ic.gujarat.gov.in, which publishes the scheme resolution and the component guidelines.
• Portal problems: raised through the support option inside ifp.gujarat.gov.in against your application number.

Applying is free. No consultant is required, and any assistance sanctioned is credited only to the enterprise's own bank account. Enterprises are advised to read the component guideline published on ic.gujarat.gov.in alongside the parent Government Resolution dated 05/10/2022, since the resolution governs wherever a guideline is silent.