1. Ext.P14 Order, which allows Ext.P13 request of the petitioner for instalments to pay the penalty demanded by the Geologist, but which also directed payment of interest, is under challenge in this Writ Petition. The compass of controversy is only with respect to the demand for payment of interest, in Ext.P14. The following are the essential facts which are required to be taken stock of.

2. A show cause notice was issued to the petitioner vide Ext.P6 on 13.01.2025, alleging excess and illegal mining and claiming royalty and penalty of Rs.12,42,54,213/-. To Ext.P6 show cause, the petitioner gave Ext.P7 reply. As per Ext.P8 dated 29.03.2025, the petitioner preferred an application for considering the matter in the Adalath, enabled by Ext.P3 G.O. Accordingly, the matter was considered in the Adalath and Ext.P9 Order was passed, reducing the penalty amount to Rs.6,73,65,160/-. In Ext.P9, the petitioner was called upon to place objection, if any, to the above referred amount within a period of seven days from the date of receipt of Ext.P9. The petitioner claims that he gave Ext.P10 reply to Ext.P9.

3. Ext.P11 is the Order dated 11.06.2025, which alleges that the petitioner had not shown any cause in answer to Ext.P9, nor had remitted the amount claimed thereunder. Accordingly, Ext.P11 directs the petitioner to pay the aforesaid sum of Rs.6,73,65,160/- and cautions him of legal consequences, for non-compliance. Thereafter, the petitioner preferred Ext.P13 application dated 18.06.2025, seeking payment by instalments of the amount covered by Ext.P11. While so, a demand notice was issued vide Ext.P12 dated 14.07.2025, calling upon the petitioner to remit the above referred amount of Rs.6,73,65,160/- within a period of seven days from the date of receipt of Ext.P12, failing which, revenue recovery proceedings were threatened. This was followed by the impugned Ext.P14 Order dated 25.07.2025, allowing Ext.P13 application for grant of instalments, but also incorporating the demand for interest at the rate of 12% per annum in respect of the five instalments granted, over and in addition to the first instalment of Rs.1,15,00,000/-. The demand for interest in Ext.P14 is the subject matter of challenge.

4. Heard Sri.George Poonthottam, learned Senior Counsel, duly instructed by Adv.Saritha Thomas, on behalf of the petitioner and Smt.Vidya A.C, learned Government Pleader on behalf of the respondents. Perused the records.

5. Learned Senior Counsel for the petitioner would submit that the incorporation of a clause for levy of interest in Ext.P14 is illegal, inasmuch as there is no such clause or condition, either in Exts.P9, P11 and P12 demands. The petitioner has been afforded the benefit of the Adalath, pursuant to Ext.P8 application, vide Ext.P9 Order reducing the penalty amount to Rs.6,73,65,160/-. The demand was reiterated in Exts.P11 and P12, wherein also, the very same amount of Rs.6,73,65,160/- is seen reiterated. Only for the reason that the petitioner sought for instalments vide Ext.P13, the Government cannot come up with a fresh claim for imposition of levy of interest, is the point mooted. The levy of interest, demanded vide Ext.P14, in fact, militate against the very concept of Adalath, which offers some benefit/solace to persons, from whom the amounts are due to the Government. On law, learned Senior Counsel would argue that the provisions of Rules 114 and 115 of the Kerala Minor Mineral Concession Rules, 2015 (for short, 'K.M.M.C Rules') are liable to be read together. According to the learned Senior Counsel, the period stipulated in Rule 114 will stand automatically extended to the last date fixed for payment of the last instalment in terms of Rule 115; and the question of levy of interest will arise only after the expiry of the period stipulated for the last payment; and not on the expiry of the 60 days period stipulated in Rule 114. This should be the effect of a combined reading of Rules 114 and 115, according to the learned Senior Counsel. On such premise, Ext.P14, to the extent it seeks to levy interest on the amount, is sought to be quashed.

6. Learned Government Pleader would submit that the demand for interest at the rate of 12% per annum is made in Ext.P14 by invoking Rule 114 of the K.M.M.C. Rules. Learned Government Pleader would characterise and distinguish the nature of Exts.P9, P11 and P12. Ext.P9 is the formal result in consideration of the petitioner’s application vide Ext.P8 in the Adalath, whereby the penalty amount has been reduced to Rs.6,73,65,160/-. Ext.P9 called upon the petitioner to place on record their objections, if any, within seven days. The same was not done; nor was the amount paid, which resulted in the issuance of Ext.P11 Order, which reiterated the demand of Rs.6,73,65,160/- and cautioned of the legal steps to ensue, if the amount is not paid. The same also did not fetch any result, which led to the issuance of Ext.P12 demand, specifically calling upon the petitioner to pay the amount within seven days; failing which, revenue recovery proceedings were threatened. Thus according to the learned Government Pleader, Ext.P12 partakes the character of a demand specifically calling upon the petitioner to pay the reduced amount of Rs.6,73,65,160/- within a specific period of seven days. Therefore, from the expiry of 60 days reckoned from the date specified in Ext.P12, Rule 114 will operate, enabling levy of interest at the rate of 12% per annum. The learned Government Pleader would explain that Ext.P12 was dated 14.07.2025. The date on which Ext.P12 is served on the petitioner is neither known to the petitioner, nor to the learned Government Pleader. However, the 1st instalment pursuant to Ext.P14 Order has been made on 09.09.2025, which is within 60 days period reckoned even from 14.07.2025. That is why Ext.P14 demanded interest only for the subsequent instalments, which were made on 16.10.2025, 05.11.2025, 28.11.2025 and 11.12.2025, all of which fell outside the span of 60 days reckoned from 14.07.2025. The learned Government Pleader would submit that invocation of Rule 115 for grant of instalments will not eclipse the operation of Rule 114 of the K.M.M.C. Rules.

7. Having heard the learned counsel appearing for the respective parties, this Court is of the view that Ext.P14 Order, insofar as it purports to levy interest as well, cannot be sustained. For a correct understanding of the issue, Rules 114 and 115 are extracted here below:

                  “114. Interest on delayed payments.-The Competent Authority may charge simple interest at the rate of 12% per annum on any rent, royalty, price of mineral or any other sum due to the Government under the Act or these Rules from the sixtieth day of the expiry of date fixed by the Authority for payment of such sum and until payment of such sum is made.

                  115. Payment of mining dues in installment.-Government may allow collection of any rent, royalty, tax, fee, price of mineral or other sum due to the Government under these rules in monthly installments not exceeding maximum six installments”.

8. While Rule 114 enables levy of simple interest at the rate of 12% per annum on any rent, royalty, price of mineral or any other sum due to the Government under the Act and Rules, Rule 115 enables the Government to collect the above referred sum in monthly instalments, but not exceeding a maximum of six instalments. The power under Rule 114 is bestowed upon the competent authority; whereas the power to grant instalments under Rule 115 is on the Government.

9. It is possible to conceive the learned Government Pleader’s argument that “other sum due to the Government” as employed in Rule 115, can include the interest component as well, since interest on delayed payment is also a sum due to the Government under the Rules, specifically vide Rule 114. However, to translate that concept into action, a demand should have been made for levy of interest invoking the powers under Rule 114. This is for the reason that interest on delayed payment is not automatic, since the rule employs the term “may”. Thus, it is the discretion of the competent authority to charge simple interest on any delayed payment. If such a demand is issued at any time prior to the project proponent’s request for instalments in terms of Rule 114, it could possibly be argued that the sum due to the Government for the purpose of Rule 114 would include the interest component as well. However, the same has not been done in the instant facts.

10. This Court further notice that the power to grant instalments in terms of Rule 115 is on the Government; and not on the Geologist. However, by virtue of Ext.P3 G.O. dated 25.08.2023, the power to conduct adalath for clearance of arrears of royalty and penalty on account of illegal mining has been conferred on the Geologist and necessary guidelines have been issued. As per the guidelines, the responsibilities of the District Geologist are i). to examine the records, conduct site inspection and to take measurements; ii). to fix the penalty as per law; iii). to ensure that payments have been made by the assessee as per the instalments granted; and iv). to initiate revenue recovery proceedings, if there is default in the matter of payment as per permitted instalments. It is relevant to notice that a power to charge interest has not been bestowed upon the District Geologist, vide Ext.P3. That being so, incorporating an interest component in Ext.P14, wherein the Geologist is admittedly acting in terms of the powers conferred by Ext.P3, cannot be countenanced. As already taken note of, no demand for interest in terms of Rule 114 has been issued by the Geologist/competent authority pursuant to the expiry of seven days prescribed in Ext.P12 dated 14.07.2025. The Geologist chose to levy interest at the stage of Ext.P14 dated 25.07.2025, which on the face of it appears to be illegal. When the power to levy interest under Rule 114 is not exercised either at the time of original demand or at the time of revised demand pursuant to the Adalath, exercise of such power only when the project proponent seeks the benefit of instalments does not appear to be legal.

11. In the circumstances, Ext.P14, insofar as it purports to levy interest on the last five instalments cannot be sustained in law and the same will stand set aside to that extent. It is clarified that the grant of instalments vide Ext.P14 will remain untouched.

                  The Writ Petition will stand allowed as indicated above.