Found the problem, my android library module was missing the kotlin configuration:
apply plugin: 'kotlin-android'
dependencies {
implementation "org.jetbrains.kotlin:kotlin-stdlib-jre7:$kotlinVersion:<version>"
}
Although I used kotlin .kt files in it, it could build without and also
Tools -> Kotlin -> 'Configure Kotlin in projects'
had told me ‘All modules with Kotlin files are configured’