UP Makes Bank Guarantee Mandatory For MSME Investors

The Uttar Pradesh government has made changes in its current Micro, Small and Medium Enterprises (MSME) policy and the new change makes it mandatory for private investors to provide bank guarantee for availing the stamp duty exemption. 

The Additional Chief Secretary (MSME) Amit Mohan Prasad has issued a notification in this regard. According to the notification, a bank guarantee equivalent to the stamp duty exemption will be deposited and released after the unit begins commercial production.

The commencement date of the project will be confirmed by the district magistrate or the general manager. 

It may be noted that the Uttar Pradesh government has made a provision for 100 per cent stamp duty exemption on purchase of land for MSME industrial parks, estates and flatted factory complex units spread over 10 acres of land or more by the private sector.

Apart from this, the policy also has other provisions for exemption in stamp duty for MSME units. The state government approved the MSME policy in October 2022 in a bid to encourage small units.

Sources in the government stated that any investor willing to set up an MSME industrial park in 10 acres or more will get exemption from all stamp duties. Flatted factory complex units will also be exempted from stamp duty on purchase of land for setting up of units.

Female entrepreneurs will get 100 per cent exemption for setting up a unit anywhere in the state.100 per cent stamp duty exemption will also be provided for the MSME industrial units in Bundelkhand and Purvanchal.