Amended Technology Upgradation Fund Scheme (ATUFS)

What is the Amended Technology Upgradation Fund Scheme (ATUFS)?

The Amended Technology Upgradation Fund Scheme (ATUFS) is a Central Sector industry-incentive scheme of the Ministry of Textiles, administered by the Office of the Textile Commissioner. ATUFS is the latest version of the long-running Technology Upgradation Fund Scheme (TUFS), first launched in 1999, which has supported modernisation across India's textile value chain for more than two decades.

ATUFS provides a one-time Capital Investment Subsidy (CIS) to textile manufacturing units that install eligible, modern, benchmarked machinery. The goal is to make Indian textile production more competitive, boost exports and create employment by reducing the cost of upgrading old equipment to world-class technology.

Subsidy structure

According to the Ministry of Textiles, ATUFS reimburses part of the cost of eligible machinery through two segments:

• Segment 1 to garmenting and technical textiles: a 15% Capital Investment Subsidy, subject to a ceiling of Rs 30 crore per entity.
• Segment 2 to other textile segments such as weaving, weaving preparatory, knitting, processing, jute, silk and made-ups: a 10% Capital Investment Subsidy, subject to a ceiling of Rs 20 crore per entity.

The overall subsidy that a single entity can draw is capped at Rs 30 crore. The subsidy is paid once, after the machinery is installed and verified. It is not a recurring grant or an interest subsidy.

Key features

• ATUFS is a credit-linked scheme: the unit must take a term loan from a notified lending agency for the upgradation.
• Only benchmarked machinery on the scheme's approved list qualifies.
• The scheme was framed for the period 2015-16 to 2021-22 with a defined budget outlay; new machinery registrations under it have since closed while sanctioned cases are settled.

Who is eligible for ATUFS?

A unit can apply if:

• It is a registered textile manufacturing entity. A company, partnership firm, LLP, co-operative or society engaged in textile production.
• It invests in eligible benchmarked machinery under one of the covered segments.
• It has a term loan sanctioned by a notified lending agency for the investment.
• It completes machinery installation and passes joint inspection.

You cannot apply if:

• You are an individual citizen, household or handloom weaver seeking a personal benefit — ATUFS is an industry incentive, not a citizen scheme, and individuals cannot apply for a personal subsidy.
• Your investment is in second-hand machinery or equipment outside the benchmarked list; such investment is not eligible.
• Your unit self-funds the machinery without a term loan from a notified lending agency, which breaks the credit-linked requirement.

Because ATUFS is a firm-level incentive, the "beneficiary" is the manufacturing enterprise, and the wider benefit, modern jobs and competitive exports: flows to the sector rather than to any one person.

What documents are required for ATUFS?

How to apply for ATUFS

1. Confirm the current status of the scheme and the benchmarked machinery list on the i-TUFS portal under txcindia.gov.in.
2. Arrange a term loan for the technology upgradation from a notified lending agency (a bank or financial institution recognised under the scheme).
3. Register the unit and the investment on the i-TUFS platform, obtaining a Unique Identification (UID) for the eligible machinery.
4. Purchase and install the benchmarked machinery, keeping all invoices and payment proofs.
5. Have the installation verified by joint inspection and a chartered accountant, and submit the claim through the lending agency to the Office of the Textile Commissioner.
6. On approval, the Capital Investment Subsidy is released to the unit's bank account.

How much benefit does ATUFS provide?

ATUFS provides a one-time Capital Investment Subsidy of 15% (up to Rs 30 crore) for garmenting and technical textiles, or 10% (up to Rs 20 crore) for other segments, on eligible benchmarked machinery, with an overall cap of Rs 30 crore per entity. Because it is credit-linked and paid only after verified installation, the actual amount depends on the size of the investment and the segment.

Help and where to verify

• Office of the Textile Commissioner: 022-22001050
• Portal: txcindia.gov.in (i-TUFS)

ATUFS has fixed scheme periods and revised guidelines over time, so verify whether new registrations are open and confirm the exact subsidy rates and caps on txcindia.gov.in before committing to any machinery purchase.

How to check your application status

ATUFS claims move through the lending agency and the Office of the Textile Commissioner, not through a citizen-style tracking number, so a unit needs to check status from more than one place.

1. Log in to the i-TUFS portal at txcindia.gov.in with the unit's registered credentials and open the UID record created at the time of machinery registration. The portal shows which stage the case is at: registration, term-loan linkage, installation, joint inspection, or subsidy release.
2. Contact the lending agency first for loan-linked steps. Because ATUFS is credit-linked, the bank or financial institution that sanctioned the term loan is usually the first to know whether the claim has been forwarded to the Office of the Textile Commissioner, since claims are routed through the lending agency rather than filed directly by the unit.
3. Call the Office of the Textile Commissioner helpline on 022-22001050 for status on claims already submitted for verification or subsidy release. Keep the UID and the unit's registration details ready when calling, since the query will be tracked against the UID rather than a name or address.
4. Check for joint inspection scheduling separately. A pending joint inspection (the physical verification of installed and working machinery by the designated inspecting authority) is a distinct stage from portal registration, and units sometimes need to follow up with the inspecting agency directly to get a visit scheduled rather than waiting for it to be triggered automatically.
5. Track subsidy release through the bank account, not the portal alone. Since the Capital Investment Subsidy is credited to the unit's bank account through the lending agency, a released subsidy may reflect in the account statement before or around the same time the portal status updates, so reconcile both.

Because new UID registrations under ATUFS have closed, status checks now are almost always for a case that entered the pipeline before the scheme period ended, so allow for processing queues built up from the large volume of legacy claims still being settled.

Common reasons for rejection

Machinery not on the benchmarked list. ATUFS only subsidises machinery that appears on the scheme's approved benchmarked machinery list for the applicant's segment. A common rejection reason is investing in equipment that looks similar but was never notified under the scheme, or that falls under a different segment's list than the one claimed. The fix is to verify the exact machine model and specification against the current benchmarked list on the i-TUFS portal before purchase, not after installation.

No term loan from a notified lending agency. Because ATUFS is a credit-linked subsidy, a unit that self-funds the machinery purchase, or that borrows from a lender not recognised under the scheme, will not qualify for the Capital Investment Subsidy. Arranging the term loan from a notified agency before registering the investment avoids this.

Second-hand or reconditioned machinery. Claims involving used, refurbished, or reconditioned equipment are rejected because the scheme is designed to fund genuinely new technology upgradation. Units should confirm with their supplier and keep purchase documentation that clearly establishes the machinery as new.

UID registered after machinery purchase or installation. ATUFS requires the Unique Identification for the machinery to be obtained on the i-TUFS platform as part of the registration step, before or alongside the investment. Claims where the paperwork sequence is reversed, machinery bought and installed first, UID applied for afterward, run into eligibility disputes at the verification stage.

Joint inspection findings do not match the claim. The subsidy is released only after installed and working machinery is verified. If the joint inspection finds machinery that is not installed, not operational, or does not match the invoiced specification, the claim is held back or rejected. Keeping installation, commissioning and inspection dates properly documented, and ensuring the machinery is fully operational before requesting inspection, prevents this mismatch.

Incomplete or inconsistent documentation across agencies. Since a claim passes through the unit, the lending agency, and the Office of the Textile Commissioner, mismatched invoice numbers, loan sanction details, or CA certification figures between what each party has on file is a frequent cause of delay or rejection. Cross-checking that the same figures and documents are submitted at every stage reduces this risk.

Claim exceeds the entity-level cap. A unit that has already drawn subsidy close to the overall Rs 30 crore per-entity ceiling, or that claims an amount exceeding the 15% or 10% rate for its segment, will have the excess portion rejected. Calculating the eligible subsidy against the correct segment rate and ceiling before submitting the claim avoids this.