Launched on 1st January 2022 by the Department of Micro, Small & Medium Enterprises and Textiles, Government of West Bengal, the “Work Force Welfare Assistance” sub-scheme is part of the broader Incentive Scheme for MSMEs in the Powerloom Sector. The initiative remains valid until 31st December 2024 and is designed to support eligible micro, small, and medium enterprises in the powerloom sector by reimbursing expenditure incurred on contributions towards Employees State Insurance (ESI) and Employees Provident Fund (EPF). This incentive is applicable if at least 50% of the enterprise’s employees are recruited from among those registered with the Employment Bank of the State.
Key Objectives
- Fiscal Incentives: Extend financial support for the installation of modern shuttleless powerlooms aimed at boosting production and quality in the textile sector.
- Workforce Welfare: Promote welfare by reimbursing contributions made towards ESI and EPF for the workforce.
- Sectoral Growth: Create a sustainable ecosystem for MSMEs in the powerloom sector by maximizing resource utilization, generating new employment, and broadening operational capacities, thereby positioning the state as a leader in the powerloom industry.
Benefits
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Reimbursement Structure: Eligible enterprises receive 100% reimbursement in the first year, followed by 75% in the subsequent years.
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Duration Based on Zones:
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Zone B: Reimbursement over 5 years.
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Zone C: Reimbursement over 7 years.
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Zones D & E: Reimbursement over 9 years.
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Eligibility Criteria
To qualify for the sub-scheme, the following conditions must be met:
- Sector & Enterprise Type: The scheme is open to all micro, small, and medium enterprises in the powerloom sector.
- Production Commencement: Enterprises must have started production between 01.01.2022 and 31.12.2024.
- Four-Party Agreement: Enterprises should have executed an agreement with the Directorate of Textiles, a financial institution, and Tantuja.
- Unit Types: Eligible units include private, cooperative, and joint sector undertakings, as well as companies/undertakings owned and managed by the State Government and Industrial Self Help Groups (SHGs).
- Project Feasibility: The project should be backed by a detailed feasibility report or project report.
- Financial Sanction: The project must have been approved and sanctioned by a Central Financial Institution, Commercial Bank, or State Financial Institution.
Exclusions
- Enterprises for which eligibility certificates have already been issued, or incentives have been sanctioned and/or disbursed under the respective state scheme.
- Enterprises registered and issued eligibility certificates under the state scheme without any sanctioned or disbursed incentive.
- Enterprises that commenced production before 31.12.2021 and applied for incentives within the stipulated period (such claims will be governed by the respective state scheme).
Application Process
Offline Submission:
After commencing production, an eligible enterprise must submit an application in the prescribed format (Form-A2) along with all required documents to the Directorate of Textiles.
Time Frame:
The first application must be submitted within 12 months from the date of commencement of commercial production (for enterprises starting production between 01.01.2022 and 31.12.2024).
Submission Address:
Directorate of Textiles, Handlooms, Spinning Mills, Silk Weaving & Handloom Based Handicrafts Division
New Secretariat Buildings,
1, K. S. Roy Road, 5th Floor, ‘B’ Block,
Kolkata 700001.
Tel: 033-2248 4537 / 2248 6271 (Ext. 215)
Fax: 033-2248 4537
Documents Required
- A copy of the Memorandum of Association and Articles of Association authenticated by the Registrar of Companies or partnership deed (wherever applicable).
- A statement on the name and address of the Directors, Partners, Owners, or Members of Cooperative or Self Help Groups.
- Copy of the approved project report.
- Loan sanction letter and disbursement letter from financial institutions or banks.
- Copy of the agreement.
- Audited balance sheets for the last 2 years (where applicable).
- Details of existing manufacturing activities in West Bengal (including items produced, annual approved capacity, and annual production figures for the last three years, in quantity and value in Rs. Lakh, if applicable).
- Copy of the land deed. For rented/leasehold properties, a copy of the rent agreement and receipt/lease agreement.
- Copy of mutation and conversion certificate of the land/building.
- Copy of the valid consent to operate certificate from the WBPCB.
- Copies regarding SGST.
- Copy of the trade licence.
- Copy of the first electricity bill (wherever applicable).
- Copy of the acknowledgement of Udyam Registration.
- Copy of SC/ST certificate (where applicable).
- Copy of any other statutory licenses/certificates, if necessary.
- “Self declaration” as per para 7.1(vi) of the Official Scheme Guidelines.
- Copies of documents regarding contributions made to ESI/EPF.
- A statement listing the names of workers, their age, date of appointment, nature of appointment, and nature of work.
- Certificate from the Regional Provident Fund Commission as per Annexure – III.
- Certificate from the Director, ESI as per Annexure – III.
- Documents showing recruitment from the Employment Bank of the State.
Frequently Asked Questions (FAQs)
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What areas are classified under “Zone A” for the purpose of determining incentives?
The Official Scheme Guidelines specify the criteria for classifying certain areas as Zone A. For the detailed list, please refer to the guidelines or contact the Directorate of Textiles. -
Which districts fall under “Zone B” for incentive classification?
The districts included in Zone B are outlined in the Official Scheme Guidelines. Applicants are advised to review the guidelines for the updated list. -
What is the primary eligibility criteria for incentives under the “Incentive Scheme for MSMEs in Powerloom Sector”?
The enterprise must be a micro, small, or medium unit in the powerloom sector that started production between 01.01.2022 and 31.12.2024, and has an approved project supported by a detailed feasibility report. -
How is the annual reimbursement of expenditures determined under this sub-scheme?
In the first year, a 100% reimbursement is provided, followed by a 75% reimbursement in the subsequent years. The duration of the reimbursement varies by zone: 5 years for Zone B, 7 years for Zone C, and 9 years for Zones D & E. -
How does the Directorate of Textiles scrutinize and conduct physical inspection of the enterprise upon receiving its application?
The Directorate performs a thorough verification by reviewing submitted documents and conducting physical inspections to ensure compliance with the scheme’s requirements. -
How is the Capital Investment Subsidy released by the Directorate of Textiles to the Bank/Financial Institution, and what requisites are necessary for this process?
The subsidy is disbursed to the Bank or Financial Institution after verification of the enterprise’s eligibility and compliance with the scheme’s guidelines. Specific requisites include proper documentation and adherence to the approved project details. -
What is the procedure for claiming the Subsidy?
Eligible enterprises must submit Form-A2 along with the required documents to the Directorate of Textiles within 12 months of commencing production. Upon verification, the subsidy covering the eligible expenditure on ESI/EPF contributions is reimbursed according to the stipulated percentages and time frames. -
What is the significance of the classification of areas into different zones for the scheme?
Zone classification helps in tailoring the incentive structure based on local conditions and infrastructural development, ensuring targeted support and equitable distribution of benefits. -
Would an eligible enterprise that has availed of incentives or subsidies under any other state government incentive scheme be eligible for benefits under this scheme?
No, enterprises that have already received eligibility certificates or disbursed incentives under another state scheme are not eligible for additional benefits under the Incentive Scheme for MSMEs in the Powerloom Sector. -
How does the Directorate of Textiles determine the eligibility of enterprises for projects financed from their own resources?
Eligibility is assessed based on the detailed project report or feasibility study, along with compliance with the financial and operational criteria set out in the Official Scheme Guidelines. -
What is an “Approved project”?
An approved project is one that has been sanctioned and financed by a recognized financial institution after meeting all the criteria outlined in the scheme’s guidelines. -
What measures are in place to prevent misuse of the subsidy scheme?
The scheme includes strict document verification, physical inspections, and clearly defined exclusion criteria to prevent duplicate benefits and ensure the proper use of funds. -
What action will the Directorate of Textiles take if an application is determined to be ineligible?
The Directorate will notify the enterprise of its ineligibility, and further administrative or legal measures may be taken as per the Official Scheme Guidelines to enforce compliance and prevent misuse.