The Mines and Minerals (Development and Regulation) Act, 1957 remains unaffected by the Jan Vishwas Act and the new Mines and Minerals Adjudication of Penalties Rules, 2026, according to the mines ministry. As per the ministry statement, "In a scenario where there is violation of rules and illegal mining, the violator will attract both civil liability as well as criminal liability for illegal mining." The ministry clarified that "The MMDR Act, which provides for recovery of economic value of mineral along with rent, royalty or tax for illegal mining, remains unaffected by the Jan Vishwas Act or the Adjudication Rules."
Under the new rules, financial penalties are now capped at ₹50 lakh regardless of the extent of illegal extraction, as reported by Business Standard. For mining lease holders, penalties for illegalities have been prescribed according to the area of the lease. Leases up to 5 hectares attract penalties of ₹2,000 to ₹10,000 per hectare for violations other than reporting-related ones. Leases above 5 hectares and up to 50 hectares face penalties of ₹3,000-15,000 per hectare, while leases above 50 and up to 150 hectares are subject to ₹4,000-20,000 per hectare. Leases exceeding 150 hectares face the highest penalties of ₹5,000-25,000 per hectare. The ministry noted that violation of rules has now been converted from criminal offence to civil penalty, with a mechanism introduced for summary disposal to secure compliance.
The MMDR Act maintains strict criminal penalties for illegal mining activities, with Section 21(1) providing imprisonment up to 5 years and a fine up to ₹5 lakh per hectare for illegal mining. Under Section 21(2), penalties include imprisonment up to 2 years or fine up to ₹5 lakh or both for contravention of rules made under Section 23C. The ministry emphasized that "The provisions of the MMDR Act regarding illegal mining are unchanged and remain unaffected by the adjudication rules." State governments retain power to make rules for prevention of illegal mining, transportation and storage under Section 23C, while Section 21(5) deals with recovery of cost of minerals along with rent, royalty or tax for mining without lawful authority.
The new rules introduce a summary-disposal route that allows violations to be closed without an inquiry if the lease holder pays the prescribed minimum penalty and rectifies the violation, according to Business Standard. Reporting-related violations are capped at ₹5,000, ₹1 lakh, ₹2 lakh and ₹3 lakh depending on the lease size. Former additional director of mines U C Jena expressed concerns that this framework could effectively provide lessees with a 'predictable exit route' and substantially dilute enforcement deterrent value. The ministry clarified that "The adjudication rules only cover violation of rules other than the rules for illegal mining."
Despite concerns about reduced enforcement effectiveness, some industry experts view the rules as an attempt to streamline and digitally execute the penalty adjudication framework, according to Business Standard. Amit Bhargava from KPMG noted that the rules intend to bring more structure, transparency and standardisation to the process. However, Sankar Prasad Pani, a senior advocate, expressed concerns that the rules may decriminalise violations of mining laws and potentially weaken state enforcement powers. The new framework also includes a three-year limit on complaints, which could impact enforcement in cases where irregularities are detected only after reconciling production data.
