Vehicle Seized For Transporting Minerals Without Permit Must Be Released On Payment Of Penalty; Retention Serves No Purpose: Andhra Pradesh High Court

"Nowhere the Rule postulates that the vehicle cannot be released, unless the [penalty] is paid... merely keeping vehicle would not serve any fruitful purpose." Andhra Pradesh High Court, in a significant ruling dated July 3, 2026, held that vehicles seized for transporting minor minerals without a valid transit permit should be released upon the payment of the prescribed penalty and seigniorage fee.

A bench of Justice Venkateswarlu Nimmagadda observed that the relevant statutory rules do not mandate the continued detention of a vehicle until the conclusion of proceedings, provided the fiscal interests of the state are secured through the levy of penalties.

The petitioner, Korabandi Karimulla, approached the High Court under Article 226 of the Constitution seeking a Writ of Mandamus against the seizure of her Tipper Lorry (AP 39 WR 7679). The vehicle was seized by the Tulluru Police in connection with Crime No. 197/2026 for alleged violations of the Andhra Pradesh Minor Mineral Concession Rules, 1966, and the Mines and Minerals (Development and Regulation) Act, 1957. The petitioner contended that the seizure was arbitrary and conducted without following the mandatory procedure established under the law.

The primary question before the court was whether the respondent authorities were justified in retaining the custody of the vehicle seized under the Mineral Rules. The court was also called upon to determine if Sub-Rule (3)(iii) of Rule 26 of the Andhra Pradesh Minor Mineral Concession Rules, 1966, acts as an absolute bar to the release of a vehicle prior to the payment of penalties.

Court Explains Scope Of Rule 26 Of AP Minor Mineral Concession Rules

The Court primarily focused on the interpretation of Sub-Rule (3)(iii) of Rule 26 of the Andhra Pradesh Minor Mineral Concession Rules, 1966. This rule stipulates that if a driver or owner fails to produce a valid transit permit, the officer in charge may require the payment of five times the normal seigniorage fee as a penalty, in addition to the normal fee and other statutory dues. The petitioner argued that the 3rd respondent seized the vehicle without the authority of law, specifically violating this provision.

Statutory Interpretation Of Penalty Provisions

Relying on the Division Bench judgment in Naganath Vs. State of A.P., the court noted that the rule does not expressly forbid the release of a vehicle pending penalty payment. The court emphasized that while the rule allows for the imposition of a penalty equal to the market value of the mineral at the time of interception, it does not mandate indefinite detention of the vehicle itself.

"On a reading of the above Rule, there is nothing to indicate, the vehicle cannot be released, unless the penalty and 5 seigniorage fee is paid... nowhere the Rule postulates that the vehicle cannot be released, unless the same is paid."

No Fruitful Purpose Served By Keeping Vehicles In Police Custody

The Court further invoked the landmark Supreme Court precedent in Sunderbhai Ambalal Desai Vs. State of Gujarat. The bench reiterated the principle that keeping seized vehicles in police stations for long durations serves no productive purpose as they are prone to decay and damage due to weather conditions. The court observed that it is in the interest of all parties to release the vehicle to the owner subject to certain conditions and the realization of government dues.

"Merely keeping vehicle would not serve any fruitful purpose."

The High Court disposed of the Writ Petition at the admission stage with the consent of both parties. The Tahsildar (2nd Respondent) was directed to pass appropriate orders in terms of Rule 26(3)(iii) and collect the due seigniorage fee and penalty from the petitioner as per law. The court ordered that upon the petitioner producing the receipt of such payment and ownership documents, the Station House Officer (3rd Respondent) must release the seized Tipper Lorry.

The ruling reinforces the principle that while the state has the power to penalize illegal mineral transportation, such power should not result in the unnecessary deprivation of property or the deterioration of commercial assets. By balancing the state's revenue interests with the owner's right to property under Article 300-A of the Constitution, the court ensured that the vehicle's release is tied to the fulfillment of statutory financial obligations.

Date of Decision: 03 July 2026