Reliance on an undisclosed adverse report violates natural justice and vitiates the penalty order.

The petitioner, a road-construction contractor engaged by the Madhya Pradesh Road Development Corporation (MPRDC), challenged the Collector, Shivpuri’s order dated 18 December 2025 imposing a penalty of ₹8,53,50,000, stated to be fifteen times the royalty, together with equivalent environmental compensation, for alleged illegal extraction of 1,13,800 cubic metres of Muram from Government land bearing Survey No. 1992/1/2.

The petitioner claimed that it had undertaken road-shoulder repair work pursuant to MPRDC’s directions and that only approximately 229.30 cubic metres of soil/Muram had been used. It relied on royalty receipts, toll receipts and MPRDC-related documents in response to the show-cause notice dated 27 February 2025.

The Mining Officer’s report dated 22 April 2025 reportedly found it improbable that the alleged quantity could have been extracted within two days using one Poklain machine and four dumpers, while the Sub-Divisional Officer’s communication dated 20 June 2025 referred to MPRDC’s verification and historical Google Earth imagery and suggested a fresh inspection.

The Collector thereafter obtained a further report and passed the impugned order without supplying that report to the petitioner or granting an opportunity to respond to it.

Whether the Collector violated the principles of natural justice by relying upon a subsequent adverse report without furnishing it to the petitioner or granting a meaningful opportunity to submit objections before passing the final order.

Whether the Collector failed to consider relevant material, including the Mining Officer’s earlier report, the Sub-Divisional Officer’s communication and the documents concerning MPRDC’s road-repair work.

Whether the availability of an appellate remedy under Rule 27 of the 2022 Rules barred the High Court from exercising jurisdiction under Article 226 where the decision-making process was procedurally unfair.

The Court applied Article 226 of the Constitution of India and Rule 18 of the Madhya Pradesh Minerals (Illegal Mining, Transportation and Storage) Rules, 2022, under which proceedings may culminate in substantial monetary penalties and environmental compensation.

It further considered Rule 27, which provides an appellate remedy against orders under the Rules.

The governing principles of natural justice require that when an administrative or quasi-judicial authority obtains and proposes to rely upon fresh material adverse to a person, that material must be disclosed and a reasonable, effective opportunity to respond must be provided before a decision is made.

An authority imposing civil consequences must apply its mind to relevant material, consider the affected party’s defence and provide adequate reasons; an order based on undisclosed material or ignoring material submissions is unsustainable.

The Court found that the petitioner had initially responded to the show-cause notice and relied on the MPRDC repair work and supporting documents.

The earlier Mining Officer’s report did not support the allegation that 1,13,800 cubic metres had been extracted within two days and considered such extraction improbable, while the Sub-Divisional Officer’s communication also referred to material potentially favourable to the petitioner.

The Collector subsequently obtained a fresh report that materially altered the evidentiary position and relied upon it in imposing the penalty, but did not furnish it to the petitioner or invite objections.

The Court held that an earlier opportunity to answer the original show-cause notice could not substitute for an opportunity to address subsequently obtained adverse material.

Since the petitioner could not effectively controvert a report that had not been disclosed, the decision-making process violated natural justice.

The Court did not determine the disputed factual question regarding the actual quantity extracted; instead, it held that the procedural defect and failure to demonstrate conscious consideration of the earlier reports and the petitioner’s defence warranted judicial intervention notwithstanding the alternative remedy.

The order was quashed and the matter remanded to the Collector, Shivpuri, for fresh consideration.

The Collector was directed to furnish the petitioner with any subsequently obtained adverse report, document or material proposed to be relied upon; allow reasonable time for objections; consider the earlier reports, MPRDC-related material and the petitioner’s documents and defence; and pass a fresh, reasoned and speaking order in accordance with law.

The writ petition was accordingly allowed and disposed of.