On 16th January, 2016, The Prime
Minister of India, Shri Narendra Modi announced the “Start-up India” initiative.
This initiative aims at fostering entrepreneurship and promoting innovation by
creating an ecosystem that is conducive for growth of Start-ups. The objective
is that India must become a nation of job creators instead of being a nation of
job seekers.
The Entrepreneurs were excited by the announcements made by
Prime Minister Narendra Modi about “Startup India Action Plan”.
The following
is the analysis of eligible criteria under “Startup India”
The following conditions should be
fulfilled for getting registration under “Startup India”
A.
Conditions for Eligible Entities
1.
The following entities are eligible
- - Private Limited Company under the
Companies Act, 2013
- - Registered Partnership firm under the
Indian Partnership Act, 1932
- - Limited Liability Partnership under the
Limited Liability Partnership Act, 2008.
2.
Five years must not have elapsed from
the date of incorporation/registration.
3.
Annual turnover as defined in the
Companies Act, 2013 in any preceding financial year must not exceed Rs. 25
crore.
4.
The Startup must not be formed by
splitting up, or reconstruction, of a business already in existence.
B.
Certification from the Inter-Ministerial Board, setup by DIPP shall be required
to validate the innovative nature of the business, and should meet any of the
following conditions:-
1. be
supported by a recommendation (with regard to innovative nature of business),
in a format specified by DIPP, from an incubator established in a post-graduate
college in India; or
2. be
supported by an incubator which is funded (in relation to the project) from GoI
as part of any specified scheme to promote innovation; or
3. be
supported by a recommendation (with regard to innovative nature of business),
in a format specified by DIPP, from an incubator recognized by GoI; or
4. be
funded by an Incubation Fund/Angel Fund/Private Equity Fund/Accelerator/Angel
Network duly registered with SEBI* that endorses innovative nature of the
business; or
5. be
funded by the Government of India as part of any specified scheme to promote
innovation; or
6. have
a patent granted by the Indian Patent and Trademark Office in areas affiliated
with the nature of business being promoted.
C.
Eligible
products and services:-
1. Startup must be working towards
innovation, development, deployment or commercialisation of new products,
processes or services driven by technology or intellectual property and the
Startup must aim to develop and commercialise a significantly improved existing
product or service or process that will create or add value for customers or
workflow.
2.
The Startup must not merely be engaged
in:
a) developing
products or services or processes which do not have potential for
commercialisation; or
b) undifferentiated
products or services or processes; or
c) products
or services or processes with no or limited incremental value for customers or
workflow
For
Example: if you are
engaged in creating and developing online marketplaces like Flipkart and Amazon
then a new startup
engaged in the same field may not be eligible unless its product is
significantly improved than what existing players provide and the startup
should get a recommendation letter from the recognized incubator cell or be
recognized by the GoI or should be funded by recognized funds.
