Ok
Let me try.
In response to paging,RACH(Channel request) will be sent by the MS to the BTS with the CM service Type.In response to RACH,BSC will ask to BTS to activate a channel(usually SDCCH).Now,if there is no usable/free SDCCH available,BTS will reply with Channel NACK/Immediate Assignment reject.Now,since call set-up indication is not being sent to the MSC,so no paging response.Hence,PSR goes down.