In case of the enterprise engaged in the manufacture or production of goods pretaining to any industry specified in the first schedule to the industries ( Development and Regulation ) Act , 1951 . Central Govt. can classify any class of entreprise , whether proprietorship , HUF , association of persons , co-operative society , partnership concern , company or undertaking , by whatever name called as - MEDIUM ENTERPRISE , where the investment in plant & machinery is more than 5 CRORE RUPEES but does not exceed 10 CRORE RUPEES and in case of entreprises engaged in providing or rendering of services - Medium enterprise , where the investment in equipment is more than 2 CRORE RUPEES but does not exceed 5 CRORE RUPEES

While calculating the investment in plant & machiney , the original price thereof , irrespective of whether the plant & machinery are new or second hand , shall be taken into account provided that in case of imported machinery , the following shall be included in calculating the value , namely - Import duty ( excluding misc. expenses such as transportation from the port to the site of the factory , demurrage paid at the port ) , shipping charges , customs clearance charges , sales tax or value added tax

The cost of following items shall be excluded while calculating the investment in plant & machinery in the case of enterprises

• Equipment such as tools , jigs , dies , moulds and spare parts for maintenance and cost of consumable stores
• Installtion charges of plant & machinery
• Research and development equipment and pollution control equipment
• Power generation set ( DG sets ) and extra transformer installed by the enterprises as per regulations of state electricity board
• Procurement or installation of cables , wiring , bus bars , electrical conterol panels ( LT panels ) , oil circuit breakers , minature circuit breakers which are necessary for providing electrical power to the plant and machinery or for safety measures
• Gas producers plants
• Transportation charges for indinegnous machinery from the place of manufacture to the site of enterprise
• Charges paid for technical know how for erection of plant and machinery
• Such storage tanks which store raw materials and finished products and not linked with the manufacturing process
• Fire fighting equipments