In a significant judgment, the Supreme Court has ruled that licensed stamp vendors fall within the ambit of “public servants” as defined under the Prevention of Corruption Act, 1988 (PC Act), making them liable for prosecution in corruption cases.

The Court emphasised that it is the nature of the public duty, particularly when remunerated by the State, that brings an individual under the purview of the Act.

The ruling came in Aman Bhatia v. State (GNCT of Delhi) [Criminal Appeal No. 2613 of 2014], where a stamp vendor had challenged his conviction under Sections 7 and 13(1)(d) read with Section 13(2) of the PC Act. The allegation was that he demanded and accepted ₹2 over the face value of a ₹10 stamp paper.

The Anti-Corruption Bureau acted on a complaint filed by the buyer and conducted a trap operation leading to the prosecution.

The appellant contended that as a private licensee, he was neither a public servant nor directly employed or paid by the government, and therefore not subject to the PC Act.

However, the Bench of Justice J.B. Pardiwala and Justice R. Mahadevan rejected this argument, holding that the determinative factor is not the employment status but the discharge of a public duty remunerated by the State. The Court observed:

“Stamp vendors across the country, by virtue of performing an important public duty and receiving remuneration from the Government for the discharge of such duty, are undoubtedly public servants within the ambit of Section 2(c)(i) of the PC Act.”

The judgment also referred to State of Gujarat v. Mansukhbhai Kanjibhai Shah, which held that entities with a public character and partial State funding, like deemed universities, fall under the PC Act.

Importantly, the Court highlighted that under the 1934 Stamp Rules, licensed stamp vendors receive stamp papers at a discounted rate—this margin being a form of State-authorised remuneration. Justice Pardiwala explained that this discount constitutes compensation traceable to the State, thereby satisfying the requirement of being “remunerated by the government” under Section 2(c)(i) of the Act.

The Court further observed that:

“The purpose of securing stamp duty fortifies the motive behind the Government’s effort to remunerate stamp vendors… the appellant was discharging a duty in which both the State and the public have an interest.”

Despite upholding the legal applicability of the PC Act to stamp vendors, the Supreme Court ultimately acquitted the appellant. Upon close scrutiny of the evidence, it found that the prosecution failed to prove the alleged demand and acceptance of illegal gratification beyond reasonable doubt.

Accordingly, the conviction was set aside, and the appellant was acquitted of all charges.