Hi aspirant
You can go for lateral entry in btech 2 nd year after diploma .There is no problem at all.
The best part of doing diploma and then after joining btech is you are eligible for all diploma jobs. You can apply for them while studying .
At the end you can do job on the basis of diploma as well as btech .
So there is no issue in this .You can definitely do btech .Most of the diploma holders opt btech after their diploma .
There are state level entrances for admission in btech .It is also known as lateral entry .
You can appear in this exam and after counselling you can take admission .You will get direct admission in 2nd year.
Hope this was helpful