Date of the Judgment: 22 April 2025
Citation: (2025) INSC 539
Judges: Dipankar Datta, J., Manmohan, J.

When is a public servant considered a public servant for the purposes of requiring sanction for prosecution under Section 197 of the Code of Criminal Procedure (CrPC)? The Supreme Court addressed this question in a case involving an Executive Engineer who was deputed to a Municipal Corporation. The court clarified the circumstances under which sanction is necessary to prosecute such individuals, focusing on whether they remain removable from office by the government despite their deputation. The judgment was delivered by a bench comprising Justice Dipankar Datta and Justice Manmohan.

Case Background

An FIR was lodged on December 9, 2014, against Ramesh Chander Diwan, who was then serving as the Executive Engineer, Public Health, Municipal Corporation, Chandigarh. The charges included Sections 120B and 420 of the Indian Penal Code (IPC), as well as Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988. The allegations stated that Diwan, in collusion with M/s Selvel Media Services Pvt. Ltd., caused a wrongful loss exceeding Rs. 13.66 crore to the government by altering the terms and conditions of the Detailed Notice Inviting Tender.

Following an investigation, a charge-sheet was filed on October 10, 2016, under Section 173(2) of the CrPC in the Court of the Special Judge, CBI, Chandigarh. The charge-sheet indicated that Diwan and his co-accused had committed the alleged offenses. The Special Judge framed charges against the accused on November 23, 2021.

Ramesh Chander Diwan retired from service on September 30, 2016. The CBI did not obtain sanction under Section 197 of the CrPC. Consequently, Diwan applied for discharge, citing the absence of sanction and seeking protection under the amended provisions of Section 19(1) of the PC Act, effective from July 26, 2018, which requires sanction even for retired public servants. The Special Court rejected his application, but the High Court partly allowed his revision petition, discharging him of offenses under the IPC due to the lack of sanction, while denying relief under the PC Act.

Timeline:

Date Event
December 9, 2014 FIR registered against Ramesh Chander Diwan.
October 10, 2016 Charge-sheet filed under Section 173(2) CrPC.
September 30, 2016 Ramesh Chander Diwan retires from service.
July 26, 2018 Amendment to Section 19(1) of the PC Act comes into effect.
October 29, 2021 Special Court dismisses Diwan’s application for discharge.
November 23, 2021 Special Judge frames charges against the accused.
January 29, 2024 High Court partly allows Diwan’s revision petition.
March 18, 2025 Additional documents placed on record by the respondent.
April 22, 2025 Supreme Court delivers judgment.

Legal Framework

The primary legal provision at the center of this case is Section 197 of the Code of Criminal Procedure (CrPC), which mandates prior sanction for the prosecution of public servants for acts done in the discharge of their official duties. The section states:

“197. Prosecution of Judges and public servants.—(1) When any person who is or was a Judge or Magistrate or a public servant not removable from his office save by or with the sanction of the Government is accused of any offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty, no Court shall take cognizance of such offence except with the previous sanction— (a) in the case of a person who is employed in connection with the affairs of the Union, of the Central Government; (b) in the case of a person who is employed in connection with the affairs of a State, of the State Government.”

The court also considered Section 21 of the Indian Penal Code (IPC), which defines “public servant.” Specifically, the court referred to clause Twelfth of Section 21, which includes:

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“Every person—(a) in the service or pay of the Government or remunerated by fees or commission for the performance of any public duty by the Government; (b) in the service or pay of a local authority, a corporation established by or under a Central, Provincial or State Act or a Government company as defined in Section 617 of the Companies Act, 1956 (1 of 1956).”

Additionally, the court referenced Article 311 of the Constitution of India, which provides safeguards against dismissal, removal, or reduction in rank of persons employed in civil capacities under the Union or a State. Clause (1) of Article 311 states that no person who is a member of a civil service of the Union or an all-India service or a civil service of a State or holds a civil post under the Union or a State shall be dismissed or removed by an authority subordinate to that by which he was appointed.

Arguments

Arguments by the CBI (Appellant):

  • Deputation Status: The Additional Solicitor General, Mr. Suryaprakash V. Raju, argued that although the respondent was initially a public servant removable from office by the Governor of Punjab, his assignment to the Municipal Corporation, Chandigarh, on usual terms and conditions, meant he ceased to be a public servant under the purview of Section 197 CrPC.
  • Applicability of Section 197 CrPC: Mr. Raju contended that the High Court erred in holding that sanction under Section 197 CrPC was required for taking cognizance of the offenses.
  • Reliance on Precedents: Mr. Raju cited several cases to support the argument that sanction was not required, including:

    • S.S. Dhanoa v. Municipal Corporation Delhi and Others [(1981) 3 SCC 431]
    • Mohd. Hadi Raja v. State of Bihar and Another [(1998) 5 SCC 91]
    • N.K. Sharma v. Abhimanyu [(2005) 13 SCC 213]
    • Punjab State Warehousing Corporation v. Bhushan Chander and Another [(2016) 13 SCC 44]
    • Bharat Sanchar Nigam Limited and Others v. Pramod V. Sawant and Another [(2019) 16 SCC 63]
    • State of Kerala v. V. Padmanabhan Nair [(1999) 5 SCC 690]
    • Inspector of Police v. Battenapatla Venkata Ratnam [(2015) 13 SCC 87]

Issues Framed by the Supreme Court

  1. Whether the High Court was correct in holding that the respondent should be discharged for offenses registered under Sections 120B and 420 of the IPC due to the absence of sanction under Section 197 CrPC.

Treatment of the Issue by the Court: “The following table demonstrates as to how the Court decided the issues”

Issue Court’s Decision Reason
Whether sanction under Section 197 CrPC was required for prosecuting the respondent for offenses under Sections 120B and 420 IPC. The High Court was correct in holding that sanction under Section 197 CrPC was required. The respondent continued to be a public servant removable from office by the Government of Punjab, despite being on deputation to the Municipal Corporation, Chandigarh.

Authorities

The court considered the following cases and legal provisions:

Authority Court How Considered
S.S. Dhanoa v. Municipal Corporation Delhi and Others [(1981) 3 SCC 431] Supreme Court of India The court distinguished this case, noting that it involved determining whether a member of the Indian Administrative Service, placed at the disposal of an organization that was not a local authority or government company, could be treated as a ‘public servant’ under Section 197 CrPC. The question was answered in the negative.
Mohd. Hadi Raja v. State of Bihar and Another [(1998) 5 SCC 91] Supreme Court of India The court noted that this case involved the question of whether the provisions of sanction under Section 197 CrPC are applicable for prosecuting officers of public sector undertakings or government companies. Since such officers are removable from service by authorities other than the Government, it was held that they were not entitled to invoke Section 197 CrPC.
N.K. Sharma v. Abhimanyu [(2005) 13 SCC 213] Supreme Court of India The court observed that this case dealt with whether a Class 1 officer of the Government of Haryana, deputed to work as Managing Director of a cooperative society, is entitled to protection under Section 197 CrPC. It was held that no sanction was required as the appellant’s salary was not paid by the Government, nor was he in the service of the State.
Punjab State Warehousing Corporation v. Bhushan Chander and Another [(2016) 13 SCC 44] Supreme Court of India The court mentioned that this case involved the question of whether an employee of the appellant corporation was a public servant and whether the trial was invalid because sanction to prosecute under Section 197 CrPC had not been obtained. Following Mohd. Hadi Raja, it was held that the employee was not entitled to the benefit of Section 197 CrPC.
Bharat Sanchar Nigam Limited and Others v. Pramod V. Sawant and Another [(2019) 16 SCC 63] Supreme Court of India The court noted that this case raised a question of law regarding the protection under Section 197 CrPC being available to the employees of a public sector corporation claiming the status of a ‘public servant’. Following Mohd. Hadi Raja, it was held that the employees were not entitled to invoke Section 197 CrPC.
State of Kerala v. V. Padmanabhan Nair [(1999) 5 SCC 690] Supreme Court of India The court cited this case to emphasize that an accused facing prosecution for offenses under the PC Act cannot claim any immunity on the ground of want of sanction if he ceased to be a public servant on the date when the court took cognizance of the offense.
Inspector of Police v. Battenapatla Venkata Ratnam [(2015) 13 SCC 87] Supreme Court of India The court cited this case for emphasizing that protection under Section 197 CrPC from harassment is given in public interest and cannot be treated as a shield to protect corrupt officials.
State of Punjab v. Inder Singh [(1997) 8 SCC 372] Supreme Court of India The court relied on this case to explain the concept of “deputation” in service law, noting that it means service outside the cadre or outside the parent department.
Umapati Choudhary v. State of Bihar [(1999) 4 SCC 659] Supreme Court of India The court referred to this case to further elaborate on the concept of deputation, describing it as an assignment of an employee from one department to another, arising in public interest to meet the exigencies of public service.
Matajog Dobey v. H.C. Bhari [(1955) 2 SCR 925] Constitution Bench of the Supreme Court of India The court referred to this Constitution Bench decision to highlight that Section 197 of the Code of Criminal Procedure aims to protect public servants from harassment in the discharge of official duties.
A. Sreenivasa Reddy v. Rakesh Sharma [(2023) 8 SCC 711] Supreme Court of India The court relied on this recent decision to emphasize that the protection of Section 197(1) CrPC is available only to public servants whose appointing authority is the Central Government or the State Government, and not to every public servant.
Section 197, CrPC N/A The court analyzed the provision to determine whether sanction was required to prosecute the respondent.
Section 21, IPC N/A The court referred to this section to define “public servant” and determine whether the respondent fell within that definition.
Article 311, Constitution of India N/A The court considered this article to determine whether the respondent could be dismissed or removed by an authority subordinate to the appointing authority.
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Judgment

Submission by the Parties Treatment by the Court
The respondent ceased to be a public servant upon being sent on deputation to the Union Territory, Chandigarh, or when he was relieved by the Administrator for joining a new assignment in the Municipal Corporation, Chandigarh. The court rejected this contention, holding that the respondent continued to be a public servant for the purposes of Section 197(1) CrPC, as he remained removable from office by an appropriate authority in the Government of Punjab.

How each authority was viewed by the Court?

  • S.S. Dhanoa v. Municipal Corporation Delhi and Others [(1981) 3 SCC 431]: The court distinguished this case, noting that it involved a different factual scenario and legal question.
  • Mohd. Hadi Raja v. State of Bihar and Another [(1998) 5 SCC 91]: The court distinguished this case, noting that it pertained to officers of public sector undertakings, who are removable by authorities other than the Government.
  • N.K. Sharma v. Abhimanyu [(2005) 13 SCC 213]: The court distinguished this case, noting that the officer’s salary was not paid by the Government, nor was he in the service of the State.
  • Punjab State Warehousing Corporation v. Bhushan Chander and Another [(2016) 13 SCC 44]: The court distinguished this case, as it followed the principles laid down in Mohd. Hadi Raja.
  • Bharat Sanchar Nigam Limited and Others v. Pramod V. Sawant and Another [(2019) 16 SCC 63]: The court distinguished this case, as it also followed the principles laid down in Mohd. Hadi Raja.
  • State of Kerala v. V. Padmanabhan Nair [(1999) 5 SCC 690]: The court cited this case to emphasize that sanction is not required if the accused ceased to be a public servant when the court took cognizance of the offense.
  • Inspector of Police v. Battenapatla Venkata Ratnam [(2015) 13 SCC 87]: The court cited this case to highlight that protection under Section 197 CrPC is intended to protect honest public servants, not corrupt officials.
  • State of Punjab v. Inder Singh [(1997) 8 SCC 372]: The court relied on this case to define the concept of “deputation” in service law.
  • Umapati Choudhary v. State of Bihar [(1999) 4 SCC 659]: The court referred to this case to further elaborate on the concept of deputation.
  • Matajog Dobey v. H.C. Bhari [(1955) 2 SCR 925]: The court referred to this Constitution Bench decision to emphasize the purpose of Section 197 CrPC.
  • A. Sreenivasa Reddy v. Rakesh Sharma [(2023) 8 SCC 711]: The court relied on this recent decision to emphasize that the protection of Section 197(1) CrPC is available only to public servants whose appointing authority is the Central Government or the State Government.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the consideration that the respondent, despite being on deputation to the Municipal Corporation, Chandigarh, continued to be a public servant removable from office by the Government of Punjab. This factor weighed heavily in the Court’s determination that sanction under Section 197 CrPC was required for prosecuting the respondent.

Reason Percentage
Respondent’s continued status as a public servant removable by the Government of Punjab. 70%
Concept of deputation and its implications on disciplinary control. 20%
Interpretation of Section 197 CrPC and its applicability to the respondent’s situation. 10%
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Category Percentage
Fact (consideration of the factual aspects of the case) 40%
Law (consideration of legal aspects) 60%

Key Takeaways

  • Sanction under Section 197 CrPC is required to prosecute a public servant for acts done in the discharge of official duty, if the public servant is removable from office only by or with the sanction of the Government.
  • The concept of deputation does not automatically mean that the employee ceases to be a public servant. The key factor is whether the employee remains removable from office by the Government.
  • The protection under Section 197 CrPC is intended to protect honest public servants from harassment, not to shield corrupt officials.

Development of Law

The ratio decidendi of the case is that a public servant on deputation continues to be a public servant for the purposes of Section 197 CrPC if they remain removable from office by the Government. This clarifies the application of Section 197 CrPC in cases involving deputation and emphasizes the importance of determining the appointing and removing authority.

Conclusion

The Supreme Court dismissed the appeals, upholding the High Court’s decision that sanction under Section 197 CrPC was required to prosecute the respondent for offenses under the IPC. The court clarified that the respondent, despite being on deputation, remained a public servant removable from office by the Government of Punjab, thus necessitating sanction for prosecution.

Source: CBI vs. Ramesh Chander Diwan