Assistance for Technology Acquisition under Motivation of Entrepreneurs to Start Industries and Fiscal Assistance to Capital Intensive Industries

What is Assistance for Technology Acquisition?

Assistance for Technology Acquisition is a component of "Motivation of Entrepreneurs to Start Industries and Fiscal Assistance to Capital Intensive Industries", administered by the Industries and Commerce Department, Union Territory of Puducherry. The component came into force with effect from 1 April 2017 under the New Industrial Policy 2016 and operates across Puducherry, Karaikal, Mahe and Yanam. In departmental documents the same benefit is also referred to as the Technology Acquisition Fund.

Under this component, assistance for the acquisition of appropriate technology in any form for a specific product or process is provided by way of a 50 per cent grant, subject to a maximum of Rs 10,00,000.

The distinction that defines this incentive is between technology and equipment. A unit that buys a machine is buying capital equipment, and that is supported elsewhere in the package through capital investment subsidy. A unit that licenses a process, buys know-how, or acquires the right to make a product to someone else's design is acquiring technology, and that is what this grant is for. The incentives order states plainly that assistance will not be available for purchase of any plant and machinery or equipment.

Who is eligible for the technology acquisition grant?

Your unit can claim if:

• The assistance is sought to set up a new unit with new technology, or
• Your unit is an existing unit acquiring technology for a new product or for improvement of the production process.
• Your unit gives at least 60 per cent of its total employment to people of the Union Territory of Puducherry, and maintains that share for the period stated in the affidavit filed with the claim.
• You undertake not to transfer or dispose of the fixed assets, including plant and machinery, until five years from the date of submitting the application or of disbursement, whichever is later.

The order also settles the definitions that decide which route you are on: units that commenced commercial production on or after 1 April 2017 are considered new industries, and units that commenced production before 1 April 2017 are considered existing units. The date of commencement admitted by the entrepreneur is reckoned only after verification by officials of the Industries Department.

Additional investments made by a new or existing unit after the first claim are also eligible for subsidy, up to the ceiling limit.

You are not eligible, and cannot apply, if:

• You are claiming for the purchase of plant, machinery or equipment. That is the one explicit exclusion in this component.
• The technology is not tied to a specific product or process, a general consultancy retainer or a software subscription for office use does not meet the test.
• Your unit's local employment is below 60 per cent of total strength, or the affidavit is not filed.
• You are an individual inventor or a student seeking research funding. This is an industrial incentive paid to a registered industrial unit, and there is no personal benefit under it.
• The claim is filed after the one-year window described below.

Where two or more industrial undertakings are set up by the same proprietor, by common partners or by a common board of directors or shareholders, they are treated as separate entities for subsidy, provided their locations are different and their licences, clearances and registrations are held separately.

How much is the grant and how is it paid?

Disbursement follows the package rule. Where the unit is financed by a bank, PIPDIC or another government corporation, the grant is routed through that institution and adjusted against the loan or applied to additional fixed assets or working capital. A self-financed unit is paid directly. "Financial institution" includes PIPDIC, any other government corporation and scheduled banks including co-operative banks.

What documents are required?

How to apply for Assistance for Technology Acquisition

1. Structure the agreement so the technology is separable. If your contract bundles know-how with a machine, the department will strip out the equipment cost, which is excluded. Ask the provider to price the technology transfer distinctly.
2. Download the common application form for subsidies from industry.py.gov.in/common-application-subsidies, or collect it from the Directorate of Industries and Commerce, Industrial Estate, Thattanchavady, Puducherry 605009.
3. Prepare a short project note explaining the specific product or process the technology relates to, and whether you are a new unit setting up with new technology or an existing unit taking up a new product or improving a process.
4. Fill in all mandatory fields in the form and attach self-attested copies of the agreement, the invoice and payment proof, the unit's registration, the project note, the local-employment affidavit and your financing details.
5. Submit the signed application to the Directorate of Industries and Commerce for the Puducherry region, or to the Assistant Director at Kottucherry in Karaikal, or the technical officers at the Civil Station in Yanam or Mahe.
6. Take a dated acknowledgement with a reference number for follow-up.

What happens after you apply?

The Directorate of Industries scrutinises applications on merit to determine the quantum of assistance admissible, and the case is placed before the State Level Committee. The Committee examines the merits of each case, decides whether the unit qualifies, and recommends the amount. Departmental officials verify the date of commencement admitted by the entrepreneur before the claim is finalised.

By when must the claim be filed?

• New units: within one year of obtaining Entrepreneurs Memorandum Part-II, permanent registration, or the commencement of production certificate.
• Existing units, within one year of completing expansion, diversification or modernisation.

Common reasons technology acquisition claims are rejected

• Equipment dressed up as technology. The most frequent failure is a claim where the invoice is substantially for machinery.
• No written agreement with the technology provider identifying the product or process.
• Payment not evidenced, or paid from an account other than the unit's.
• Technology not applied, no production, no new product, no measurable process change to show the inspecting officer.
• Local employment below 60 per cent, or affidavit missing.
• Claim filed outside the one-year window.
• Asset disposal within the five-year lock-in.

Related incentives for technology and quality

An entrepreneur upgrading technology is usually eligible for more than this one component. The package also provides quality certification subsidy at 50 per cent for up to three certifications with a ceiling of Rs 2 lakh, intellectual property protection support at 50 per cent up to Rs 2 lakh for a domestic patent and Rs 5 lakh for an international patent, a skill enhancement fund meeting 50 per cent of training fees up to Rs 3,000 per person for a two-week upgradation programme through the Puducherry Management and Productivity Council or another approved institute, and assistance for energy and water conservation covering half the cost of an audit up to Rs 25,000. The capital-intensive order also carries the Infrastructure Development Subsidy for IT and ITES at 30 per cent up to Rs 1 crore.

Help and grievance redressal

• Directorate of Industries and Commerce, Industrial Estate, Thattanchavady, Puducherry 605009 to +91-413-2248476, 2248168, 2248320
• Karaikal: Assistant Director, Rural Industrial Estate, Kottucherry, +91-4368-265438
• Yanam, +91-884-2321257; Mahe; +91-490-233235
• Grievance redressal; industry.py.gov.in/grievance-redressal-mechanism

How to check your application status

There is no online tracking portal for this component. The claim moves entirely through the Directorate of Industries and Commerce and the State Level Committee, so status has to be followed up in person, by phone or in writing, using the acknowledgement reference number you were given when you submitted the form.

1. Keep the acknowledgement slip safe. The reference number and the date of submission printed on it are what the Directorate's office will ask for before they can look up your file.
2. Call or visit the office that received your claim. For units in the Puducherry region, contact the Directorate of Industries and Commerce at Industrial Estate, Thattanchavady on +91-413-2248476, 2248168 or 2248320. For Karaikal, contact the Assistant Director at the Rural Industrial Estate, Kottucherry on +91-4368-265438. For Yanam, call +91-884-2321257, and for Mahe call +91-490-233235.
3. Ask specifically which stage the file is at, since a claim under this component passes through two checkpoints: scrutiny by the Directorate to work out the quantum admissible, and review by the State Level Committee, which decides eligibility and recommends the amount. Knowing which of the two your file is sitting at tells you whether the delay is departmental verification (of your date of commencement, employment affidavit or documents) or waiting for a Committee meeting.
4. Follow up in writing if a call does not get a clear answer. A letter or email referencing your acknowledgement number, addressed to the Directorate, creates a paper trail and is the usual next step if the file has been pending for an extended period without movement.
5. Use the grievance redressal mechanism at industry.py.gov.in/grievance-redressal-mechanism if you believe your claim is stuck without reason or has missed a reasonable processing timeline. This is the formal escalation route above a routine status call.
6. Watch for a disbursement notice through your financing institution, if your unit is bank or PIPDIC financed, since the grant in that case is routed through the lender rather than paid to you directly, and the lender's own account statement will often show the credit before the Directorate confirms it by letter.