Dutt, convicted under the Arms Act for illegal possession of weapons in the 1993 Mumbai bomb blasts case, had made a plea for temporary release from the jail stating his wife Maanyata was unwell.
Pune Divisional Commissioner Prabhakar Deshmukh granted parole to the actor on recommendation of prison authorities on Friday.
Sanjay Dutt to be released for a month on parole
The RPI workers waved black flags and raised slogans condemning prison administration for showing "undue favours" to the Bollywood star and according him a special treatment. They also demanded cancellation of parole to him.
"We will organise a jail bharo agitation in Maharashtra if Dutt is granted undue relief and given special treatment as he is supposed to be treated the same way like other convicts," a spokesman of the demonstrators said.
Many even alleged that Dutt's wife not keeping well is just an alibi as Maanyata was seen attending a Bollywood event on Thursday.
The 53-year-old, undergoing the remainder of his five- year jail term, had availed of a month-long leave of furlough in October on medical grounds. The day of Dutt's expected release on parole was not yet decided, jail sources said.