Chhattisgarh tightens minor mineral rules, raises penalties for illegal mining

3 min readChattisgarhJun 25, 2026 11:00 PM IST

In another key decision, revenue-sharing benefits from minor minerals have been extended to district panchayats - in addition to urban local bodies, gram panchayats, and janpad panchayats already included. (Credit: Pixabay)

The Chhattisgarh government has introduced major amendments to its Minor Mineral Rules in a crackdown on illegal mining, transportation, and storage of minerals. The Council of Ministers under Chief Minister Vishnu Deo Sai approved the revised provisions that aim to curb illegal mining, boost state revenue, and ensure transparent utilisation of mineral resources.

Stiffer penalties for illegal mining and transport

The most significant change concerns penalties for illegal excavation and transportation. The minimum compounding amount has been fixed at Rs 25,000 across all cases. For illegal transportation, offenders will now have to pay Rs 2,000 per tonne as a compounding fee, in addition to the full value of the illegally transported mineral.

To put this in perspective: a vehicle caught carrying 35 tonnes of minerals illegally will be liable to pay Rs 70,000 in compounding charges alone, in addition to the minerals’ value. Tractor operators caught transporting sand without authorisation will face a minimum compounding fee of Rs 25,000, plus the cost of the sand.

Seized vehicles won’t come cheap to recover

To prevent repeat offences, norms for the release of seized vehicles, machinery, and equipment have been tightened. Before any seized asset can be released, owners will have to deposit a security amount ranging from Rs 50,000 to Rs 3 lakh – depending on the vehicle category – with the concerned court.

Easier permits for public infrastructure

On the other side of the ledger, the government has eased excavation permit norms for public infrastructure projects. The permissible excavation area for government construction works has been doubled from 1 hectare to 2 hectares, and permit validity has been extended from two years to three.

A new trust for scientific exploration

To promote scientific exploration and infrastructure development, the Chhattisgarh State Mineral Exploration Trust-2025 has been established. Two per cent of royalty collected from minor minerals will be credited to the trust, generating an estimated Rs 5.25 crore in additional revenue annually.

Streamlining the system

The process for amalgamation of mining leases has been simplified to remove operational hurdles and facilitate premium collection. A uniform system for the deduction of mineral royalty, DMF, environmental cess, infrastructure cess, and security deposits has also been introduced across all construction departments. Amounts will be refunded upon royalty clearance from the Mining Department; failing that, they will be deposited under the mineral head.

Panchayats to benefit from revenue sharing

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In another key decision, revenue-sharing benefits from minor minerals have been extended to district panchayats – in addition to urban local bodies, gram panchayats, and janpad panchayats already included.

Dead rent hike after 30 years

The government has also increased Dead Rent Rates for mines after nearly three decades. With over 1,900 minor mineral mines in the state – many of them lying non-operational – the move is expected to weed out non-serious leaseholders and free up inactive mines for re-auction.

The overhaul is being read as a firm expression of the Sai government’s zero-tolerance policy towards illegal mining, with a focus on stronger enforcement, greater transparency, and sustainable management of the state’s mineral resources.

(Written by Nityanjali Bulsu, who is an intern with indianexpress.com)

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