A two-judge Bench of the Supreme Court of India (Justice Prashant Kumar Mishra and Justice Shree Chandrashekhar) held that employees of government companies, distribution companies (Discoms), and public sector undertakings (PSUs) cannot automatically claim protection under Section 197 of the Code of Criminal Procedure, 1973 (Section 218 BNSS). The Apex Court reiterated that even if such employees are classified as “public servants” under specific statutes, they are not “government servants” removable only by or with the sanction of the Government. Consequently, prior government sanction is not a prerequisite to prosecute PSU or Discom staff for criminal offenses.
Court: Supreme Court of India
Bench: Justice Prashant Kumar Mishra & Justice Shree Chandrashekhar
Date of Decision: November 3, 2026
Subject Area: Criminal Procedure | Section 197 CrPC / Section 218 BNSS | Public Servant Immunity | Government Companies & PSUs (Article 12 Status vs. Government Service) | Electricity Act, 2003 (Section 169)
Core Legal Principles Established by the Supreme Court
1. Public Servant Status ≠Automatic Section 197 CrPC Protection
- An employee of a government instrumentality, corporation, or public sector undertaking does not ipso facto become a government servant entitled to protection under Section 197 CrPC merely because they qualify as a “public servant” under statutory definitions (such as Section 169 of the Electricity Act, 2003).
2. Test of Authority Removable Only by the Government
- Protection under Section 197 CrPC applies strictly to public servants who are not removable from office save by or with the sanction of the Government.
- Officers appointed by, and subject to disciplinary action or termination by, independent corporate boards of government companies (such as Discoms) fall outside this protective umbrella.
3. Article 12 “State” Status Does Not Grant Personal Criminal Immunity
- Reaffirming Mohd. Hadi Raja and Bhushan Chander, the Court held that while a government corporation or PSU may qualify as “State” under Article 12 of the Constitution for writ jurisdiction, its employees cannot automatically claim personal criminal immunity under Section 197 CrPC.
Case Trajectory & Fact Pattern
| Stage / Forum | Procedural Findings & Outcome |
| Originating Offence | Allegations of abetting electricity theft by Balim Steel Pvt. Ltd. via meter tampering, causing loss of ₹12.99 crore to Jodhpur Discom. Chargesheet filed against Executive Engineer, Assistant Engineer, and Junior Engineer. |
| Rajasthan High Court | Discharged the three Discom employees from prosecution under the Electricity Act, holding that cognizance was bad for want of prior sanction under Section 197 CrPC. |
| Supreme Court Disposition | Allowed Appeal: Set aside the High Court’s discharge order. Reaffirmed that Discom officers are not government servants entitled to Section 197 protection, and remitted the revision petitions back to the High Court to decide the chargesheet on merits. |
Key Quote from the Judgment
“An employee of a Government instrumentality, does not ipso facto become a Government servant so as to be entitled for protection under Section 197 of Cr.P.C. merely because an employee is a public servant… The very basis of the impugned judgment rendered by the High Court in favour of the respondents… giving them protection under Section 197 of Cr.P.C, is flawed being contrary to the settled judicial precedent of this Court.”
— Bench of Justice Prashant Kumar Mishra & Justice Shree Chandrashekhar