Restructuring proposals under the RBI June 2019 Prudential Framework — for viable Kerala 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 Cashew (Kollam) and Rubber & spices (Kottayam-Idukki) units in Kerala. 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 Kerala, TEV is a common bottleneck — plan the agency selection and site visit at the start of the 180-day window.
For Cashew (Kollam) 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.
DRT Ernakulam is the single DRT for Kerala and Lakshadweep.
Cashew (Kollam); Rubber & spices (Kottayam-Idukki); Gulf-return real estate; Fisheries & seafood exports
Auction / procedural note. Kerala Conservation of Paddy Land and Wetland Act restrictions can void auction of paddy/wetland — buyer must confirm land classification before EMD.
