Stage-by-stage
How an MSME account moves from first default to auction in Uttarakhand
Each stage has a different remedy and a different price. In Uttarakhand the stressed MSME book is concentrated in SIDCUL industrial units (Rudrapur, Haridwar, Pantnagar), Auto ancillaries, Real estate (Dehradun-Haridwar), Hospitality (Nainital-Mussoorie).
| Stage | Window | What the lender does | What the borrower should do |
|---|
| Regular / stress signals | Day 0–30 overdue | Cheque returns, cash-credit drawing power shortfall and EMI bounce charges. No classification change yet, branch-level follow-up only. | Write to the branch with a dated revival plan before the account slips. Easiest stage to re-term without a credit-report mark. |
| SMA-0 | 1–30 days overdue | Account flagged as Special Mention Account in the lender's CRILC reporting. Interest keeps accruing at contracted rate. | Request drawing-power recomputation and an interest-servicing arrangement. Restructuring eligibility is at its widest here. |
| SMA-1 | 31–60 days overdue | Escalation to the regional/recovery desk. Fresh limits and enhancements are frozen; ad-hoc facilities are refused. | File an RBI MSME restructuring request with 3-year projections. Viable units are re-termed rather than recovered from. |
| SMA-2 | 61–90 days overdue | Last window before classification. Lender begins guarantee/collateral review and prepares the recall path. | Decide the route now — restructure, OTS, or defend. Post-NPA the pricing and the lender's committee both get harder. |
| NPA classification | Day 91 | Account becomes a non-performing asset. Where cover exists, the lender starts the CGTMSE invocation file; recovery moves to the SBI recovery cell or a stressed-assets vertical. | Get the statement of dues and the NPA date in writing. A wrong NPA date is the most common defect in later proceedings. |
| Section 13(2) demand notice | Typically 1–6 months after NPA | 60-day SARFAESI demand notice on secured assets, specifying outstanding dues and the security to be enforced. | File a 13(3A) representation within the notice period disputing dues, NPA date and valuation. Lodge the OTS proposal in parallel. |
| Section 13(4) possession | After the 60-day window | Symbolic possession, followed by a Section 14 application for physical possession before the jurisdictional Chief Metropolitan / District Magistrate serving Uttarakhand. Any challenge now lies before DRT Dehradun. | File a Securitisation Application within 45 days and seek interim protection while the settlement is negotiated. |
| Rule 8(6) sale / auction | 30 days' notice before sale | Valuation, reserve price and e-auction notice are published. Reserve price is frequently revised downward on repeat auctions. | Challenge valuation defects and short notice; a sanctioned OTS before the sale date stops the auction outright. |
