Step 1: Recall the working principle of an impulse turbine.
In an impulse turbine (such as a Pelton wheel), the entire pressure head is converted into kinetic energy in the nozzle before striking the runner.
Step 2: Determine the casing pressure.
The runner operates in air, and the casing is maintained at atmospheric pressure.
Therefore,
\[
\boxed{\text{Atmospheric Pressure}}
\]
is the correct answer.
Hence,
\[
\boxed{(C)}
\]
is the correct answer.