Restructuring proposals under the RBI June 2019 Prudential Framework — for viable Jammu & Kashmir (UT) businesses seeking to reset tenor, moratorium, working-capital cycle or interest rate before the account slips to NPA / Doubtful.
This page is for general information. It is not legal, tax or investment advice. Every NPA / SARFAESI / DRT matter is fact-specific — speak to a qualified advisor before acting.
Restructuring is the right path when the business is viable but cash-flow is temporarily stressed — typical for Handicrafts & carpets and Apple growers units in Jammu & Kashmir (UT). OTS is right where viability is broken and the choice is between settlement discount and continued default interest.
The 7 June 2019 RBI framework replaced legacy schemes (CDR, SDR, S4A, JLF) with a lender-driven Inter-Creditor Agreement (ICA) approach. Key trigger: any account in default is reviewable inside 30 days; a Review Period of 180 days follows, within which the ICA restructuring is finalised. Failure triggers additional 20% + 15% provisioning by lenders — a strong incentive to close inside 180 days.
A Techno-Economic Viability (TEV) report from a Category-I RBI-empanelled agency is mandatory for exposures above ₹100 Cr and industry-standard for exposures above ₹25 Cr. The TEV report drives the tenor, moratorium and coupon proposed to lenders. In Jammu & Kashmir (UT), TEV is a common bottleneck — plan the agency selection and site visit at the start of the 180-day window.
For Handicrafts & carpets units, the working-capital reset typically involves: (a) reassessment of MPBF/Turnover Method limits, (b) reset of drawing power basis stock/book-debt margin, (c) release of ad-hoc limits into regular sanction. Under the current RBI framework, working-capital reassessment can be part of the ICA restructuring without triggering standstill on standard classification.
Writ jurisdiction seat.
J&K matters file at DRT Chandigarh; appeals go to DRAT Delhi.
Handicrafts & carpets; Apple growers; Hospitality & tourism; Retail trade
Auction / procedural note. Post-abrogation of Article 370, non-J&K residents can hold immovable property, but state land laws still apply — thorough diligence is essential.
