REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. 1052  OF 2010 (Arising out of SLP (Crl.) No. 334 of 2008)

K.A. Abbas H.S.A.                                                            ……….Appellant Versus

Sabu Joseph & Anr.                                                           ……..Respondents

WITH

CRIMINAL APPEAL NO. 1053  OF 2010 (Arising out of SLP (Crl) No. 4099 of 2008)

Sabu Joseph                                                                     ……….Appellant Versus

K.A. Abbas & Anr.                                                           ……..Respondents

JUDGMENT

H.L. Dattu, J.  

          Leave granted in both the special leave petitions.  

2)     These two appeals are directed against the judgment and order  

of the High Court of Kerala in Crl. Rev. Petition No.1387 of 2006  

dated 03.10.2007.

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3)       Since parties are common and the legal issues are identical,  

they are heard together and disposed of by this common order.

4)       The factual matrix in brief is as under:- The facts in criminal  

revision petition No.1387 of 2006 may be noticed for the purpose  

of  disposal  of  the  appeals.   The  appellant  (accused)  and  the  

respondent (complainant) are employed as High School assistants  

in  SSHSS  school  in  Moorkanand.  The  respondent  has  filed  a  

complaint against the appellant before the learned Magistrate for  

an offence under Section 138 of the Negotiable Instruments Act  

(the `Act’ for short).  The complainant’s case is that the appellant,  

who was due in  a  sum of  Rs.5,00,000/-,  issued a  cheque dated  

16.06.2003 in respect of that liability, and when the cheque was  

presented  for  encashment,  the  same  was  returned  with  an  

endorsement of “insufficiency of funds.”   

5)           The complainant, through his Advocate, had issued notice to  

the  appellant  demanding  the  payment  and  that  in  spite  of  the  

service of notice, the appellant failed to pay the amount covered by  

the cheque and thus has committed an offence under Section 138  

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of the Act and, accordingly, has approached the learned Magistrate  

for appropriate reliefs.    

6)       The learned Magistrate after taking cognizance of the offence  

and after recording the evidence of the parties and after analyzing  

the same, has found the accused guilty of the offence punishable  

under  Section  138  of  the  Act  and  sentenced  to  simple  

imprisonment for one year. In addition to that he had directed to  

pay  a  compensation  of  Rs.  5  lakhs  to  the  complainant  under  

Section  357(3)  of  the  Cr.PC,  and in  default,  to  undergo  simple  

imprisonment for a further period of two months.

7)           The accused filed appeal before the Sessions Court, Manjeri  

being Criminal Appeal No. 59 of 2004. The Sessions Court while  

entertaining the appeal had directed the petitioner to deposit  Rs.  

one  lakh  within  one  month  being  a  part  of  the  compensation  

amount. The appellant has complied with that order by depositing  

the  amount  as  directed  before  the  Judicial  1st Class  Magistrate,  

Manjeri.  Eventually,  the  Sessions  Judge  by  his  order  dated  

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21.03.2006  confirmed  the  judgment  of  conviction  and  sentence  

passed by learned Magistrate.  

8)             The accused preferred revision petition being Criminal  

Revision  Petition  No.  1387  of  2006  before  the  High  Court  of  

Kerala  at  Ernakulam.  The  High  Court  passed  an  interim  order  

directing the petitioner to deposit  an amount of Rs. 1 lakh before  

the Judicial Magistrate and, accordingly, the said amount was also  

deposited. The High Court while disposing of the Revision Petition  

has  observed  that  the  courts  below  had  appreciated  the  facts  

correctly  and  there  is  no  error,  illegality  or  impropriety  in  the  

finding recorded by the courts below to set aside the conviction  

and  sentence.  The  High  court  has  further  stated  that  the  only  

question  which  requires  to  be  answered  is,  whether  a  proper  

sentence has been imposed on the accused by the courts below.  

The  court  after  taking  into  consideration  the  peculiar  facts  and  

circumstances of the case has modified  the sentence imposed on  

the  accused  to  the  extent,  that,  if  the  petitioner  pays  the  

compensation  amount  of  Rs.  4  lakhs  (keeping  in  mind  that  the  

petitioner had deposited an amount of Rs. 1 lakh before the trial  

court towards the compensation amount) within a period of five  

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months, then he needs to undergo imprisonment only till the rising  

of the court  and if the petitioner commits  default in making the  

payment aforesaid, he shall undergo simple imprisonment for three  

months by way of default sentence.

9)          Being aggrieved, the accused is before this court by way of  

Criminal Appeal arising out of SLP (Crl.) No. 334 of 2008. The  

main  contention  of  the  accused  is  that  this  court  in  Criminal  

Appeal  No.  1013  of  2007  has  held,  that,  while  exercising  

jurisdiction under Section 357(3) of the Cr.PC, no direction can be  

issued  that  in  default  of  payment  of  compensation,  the  accused  

shall suffer simple imprisonment. In effect the Supreme Court has  

confirmed the judgment passed in the case of Radhakrishna Nair v.  

Padmanabhan [(2000) 2 KLT 349], wherein the Kerala High Court  

had given a similar finding. The accused also contends, that, there  

is a factual error in the judgment of the High court to the effect that  

the accused had already deposited Rs. 2 lakhs towards paying the  

compensation amount pursuant  to interim orders of the Sessions  

Court and the High Court respectively, instead the High Court has  

observed that only Rs. 1 lakh has been deposited.  

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10)       The complainant being aggrieved by the sentence imposed on  

the accused has filed SLP (Crl) No. 4099 of 2008. The contention  

of the complainant is that,  the sentence imposed is very minimal  

and will defeat the very purpose of Section 138 of N.I Act and if  

for  any  reason  the  default  sentence  is  deleted  then  there  is  no  

chance of the accused paying the compensation . In this regard, the  

complainant relies on the observation of this court in the case of  

Suganthi Suresh Kumar v. Jagdeeshan, [(2002) 2 SCC 420].  

11)           Heard learned counsel for both sides. The learned counsel  

for the accused submits, that,  the default sentence imposed by the  

learned Judge of the High Court is against the dicta of this Court in  

the  case  of  ETTAPPADAN  AHAMMED  KUTTY  @  

KUNHAPPU  VS.  E.P.  ABDULLAKEYA  @  KUNHI  BAPPU  

AND  ANOTHER  (Criminal  Appeal  No.  1031  of  2007).    Per  

contra,  the  learned  counsel  for  the  respondent  ably  justifies  the  

impugned  judgment.    The  learned  counsel  also  relies  on  the  

observations made by this  Court in the case of Suganthi Suresh  

Kumar Vs. Jagdeeshan, [(2002) 2 SCC 420].  

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12)       The main question that requires to be considered and decided  

is, whether in default of payment of compensation ordered under  

Section 357 (3) of the Cr.P.C., a default sentence can be imposed ?

13)        Let us now look at the relevant provisions and the decision of  

this court on which reliance is placed by learned counsel.   

14)      Section 357 of Cr.PC reads:-

“(1) When a court imposes a sentence of fine or a  sentence  (including a  sentence  of  death)  of  which  fine  forms  a  part,  the  court  may,  when  passing  judgment  order  the  whole  or  any  part  of  the  fine  recovered to be applied- (a)  In  defraying the expenses  properly  incurred in  the prosecution, (b) In the payment to any person of compensation  for any loss or injury caused by the offence, when  compensation  is,  in  the  opinion,  of  the  court,  recoverable by such person in a Civil Court; (c) When, any person is convicted of any offence for  having  caused  the  death  of  another  person  or  of  having abetted the commission of shelf all offence,  in paying in, compensation to the persons who are,  under the Fatal  Accidents  Act,  1855 (13 of  1855)  entitled  to  recover  damages  from  the  person  sentenced for the loss resulting to them from such  death; (d)  When  any  person is  convicted  of  any  offence  which  includes  theft,  criminal,  misappropriation,  criminal  breach  of  trust  or  cheating,  or  of  having  dishonestly  received  or  retained,  or  of  having  

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voluntarily assisted in disposing of stolen property  knowing or having reason to believe the same to be  stolen in compensating any bona fide purchaser of  such  property  for  the  loss  of  the  same  if  such  property is restored to the possession of the person  entitled thereto. (2) If the fine is imposed in a case, which is subject  to appeal, no such payment shall be made before the  period allowed for presenting the appeal his elapsed,  or if an, appeal be presented, before the decision of  the appeal. (3) When a court imposes a sentence, of which fine  does not form a part, the court may, when passing  judgment order the accused person to pay, by way of  compensation such amount as may be specified in  the order to the person who has suffered any loss or  injury by reason of  the act  for  which the  accused  person his been so sentenced. (4) An order under this section may also be made by  all Appellate Court or by the High Court or Court of  Session when exercising its powers of revision. (5)  At  the  time of  awarding  compensation  in  any  subsequent civil suit relating to the same matter, the  court  shall  take  into  account  any  sum  paid  or  recovered as compensation under this section.”

15)           Essentially the section empowers the courts, not to just  

impose  a  fine  alone  or  fine  along  with  the  sentence  of  

imprisonment, but also when the situation arises, direct the accused  

to pay compensation to the person who has suffered any loss or  

injury by reason of the act for which the accused person has been  

sentenced.  

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16)       The above view we have taken is supported by the decisions of  

this Court, to which we presently refer.

17)         In the case of Sarwan Singh and ors. v. State of Punjab (AIR  

1978 SC 1525), this court has noticed the object and genesis of the  

section.  

“10.  The  law  which  enables  the  Court  to  direct  compensation to be paid to the dependants  is  found in  Section  357  of  the  CrPC  (Act  2  of  1974).  The  corresponding provision in the 1898 Code was Section  545.  Section  545  of  the  CrPC  (Act  5  of  1898)  was  amended by Act 18 of 1923 and by Act 26 of 1955. The  amendment  which  is  relevant  for  the  purpose  of  our  discussion  is  545(1)(bb)  which,  for  the  first  time  was  inserted by Act 26 of 1955. By this amendment the court  is enabled to direct the accused, who caused the death of  another person, to pay compensation to the persons who  are,  under  the  Fatal  Accidents  Act,  entitled  to  recover  damages  from  the  persons  sentenced,  for  the  loss  resulting  to  them from such  death.  In  introducing  the  amendment,  the  Joint  Select  Committee  stated  "when  death has been caused to a person, it is but proper that his  heirs and dependants should be compensated, in suitable  cases, for the loss resulting to them from such death, by  the person who was responsible  for it.  The Committee  proceeded to state that though Section 545 of the Code as  amended in 1923 was intended to cover such cases, the  intention was not however very clearly brought out and  therefore in order to focus the attention of the courts on  this aspect of the question, the Committee have amended  Section 545 and it has been made clear that a fine may  form a part of any sentence including a sentence of death  and it has also been provided that the persons who are  entitled under the Fatal Accidents Act, 1855, to recover  

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damages from the person sentenced may be compensated  out  of  the  fine  imposed.  It  also  expressed  its  full  agreement  with  the  suggestion  that  at  the  time  of  awarding judgment  in  a case  where death has resulted  from homicide, the court should award compensation to  the heirs of the deceased. The Committee felt  that this  will result in settling the claim once for all by doing away  with the need for a further claim to a civil  Court,  and  avoid  needless  worry  and  expense  to  both  sides.  The  Committee further agreed that in cases where the death is  the  result  of  negligence  of  the  offender,  appropriate  compensation  should  be  awarded  to  the  heirs.  By  the  introduction  of  Clause  (bb)  to  Section  545(1),  the  intention  of  the  legislature  was  made  clear  that,  in  suitable  cases,  the  heirs  and  dependents  should  be  compensated for the loss that resulted to them from the  death,  from a  person  who was  responsible  for  it.  The  view  was  also  expressed  that  the  court  should  award  compensation  to  the  heir  of  the  deceased  so  that  their  claims would be settled finally. This object is sought to  be given effect to by Section 357 of the new Code (Act 2  of  1973).  Section  357(3)  provides  that  when  a  court  imposes a sentence, of which fine does not form a part,  the  Court  may,  when  passing  judgment,  order  the  accused  person to  pay,  by  way of  compensation,  such  amount, as may be specified in the order, to the person  who has suffered any Joss or injury by reason of the act  for which the accused person has been so sentenced. The  object  of  the  section  therefore,  is  to  provide  compensation payable to the persons who are entitled to  recover damages from the person sentenced even though  fine does not form part of the sentence. Though Section  545  of  1898  Code  enabled  the  court  only  to  pay  compensation  out  of  the  fine  that  would  be  imposed  under the law, by Section 357(3) when a Court imposes a  sentence, of which fine does not form a part, the Court  may direct the accused to pay compensation. In awarding  compensation  it  is  necessary  for  the  court  to  decide  whether the case is a fit one in which compensation has  to be awarded. If it is found that compensation should be  

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paid,  then  the  capacity  of  the  accused  to  pay  a  compensation  has  to  be  determined.  In  directing  compensation, the object is to collect the fine and pay it  to the person who has suffered the loss. The purpose will  not be served if the accused is not able to pay the fine or  compensation for, imposing a default sentence for non- payment  of  fine  would  not  achieve  the  object.  If  the  accused is in a position to pay the compensation to the  injured or his dependents to which they are entitled to,  there could be no reason for the Court not directing such  compensation. When a person, who caused injury due to  negligence or is made vicariously liable is bound to pay  compensation it is only appropriate to direct payment by  the accused who is guilty of causing an injury with the  necessary Mens Rea to pay compensation for the person  who has suffered injury.”

18)        In  Balraj v. State of UP (AIR 1995 SC 1935), this court has  

held,  that,  Section  357(3)  Cr.  P.C.  provides  for  ordering  of  

payment by way of compensation to the victim by the accused. It is  

an important  provision and it  must  also be noted that  power  to  

award compensation is not ancillary to other sentences but it is in  

addition thereto.

19)        In Hari Kishan v. Sukhbir Singh and ors. (AIR 1988 SC 2127),  

this  court  has  observed  that,  Sub-section  (1)  of  Section  357  

provides power to award compensation to victims of the offence  

out of the sentence of fine imposed on accused. In this case, we are  

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not concerned with Sub-section (1). We are concerned only with  

Sub-section  (3).  It  is  an  important  provision  but  Courts  have  

seldom invoked it. Perhaps due to ignorance of the object of it. It  

empowers  the  Court  to  award  compensation  to  victims  while  

passing  judgment  of  conviction.  In  addition  to  conviction,  the  

Court  may  order  the  accused  to  pay  some  amount  by  way  of  

compensation to victim who has suffered by the action of accused.  

It may be noted that this power of Courts to award compensation is  

not ancillary to other sentences but it is in addition thereto. This  

power was intended to do something to reassure the victim that he  

or  she  is  not  forgotten  in  the  criminal  justice  system.  It  is  a  

measure  of  responding  appropriately  to  crime  as  well  of  

reconciling the victim with the offender. It  is,  to some extent,  a  

constructive approach to crimes. It is indeed a step forward in our  

criminal justice system. We, therefore, recommend to all Courts to  

exercise this power liberally so as to meet the ends of justice in a  

better way.

20)          In Dilip S. Dahanukar v. Kotak Mahindra Co. Ltd. and Anr.,  

[(2007)  6  SCC 528],  this  court  differentiated  between  fine  and  

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compensation, and while doing so, has stated that the distinction  

between Sub-Sections (1) and (3) of Section 357 is apparent. Sub-

section  (1)  provides  for  application  of  an amount  of  fine  while  

imposing  a  sentence  of  which  fine  forms  a  part;  whereas  Sub-

Section (3) calls for a situation where a Court imposes a sentence  

of which fine does not form a part of the sentence.

               The court further observed:-

“19. Compensation is awarded towards sufferance of any  loss or injury by reason of an act for which an accused  person is sentenced. Although it provides for a criminal  liability,  the  amount  which  has  been  awarded  as  compensation is considered to be recourse of the victim  in the same manner which may be granted in a civil suit.”

          Finally the court summed up:-

“22.  We  must,  however,  observe  that  there  exists  a  distinction between fine and compensation, although, in a  way it seeks to achieve the same purpose. An amount of  compensation can be directed to be recovered as a 'fine'  but the legal fiction raised in relation to recovery of fine  only, it is in that sense `fine' stands on a higher footing  than compensation awarded by the Court.”

21)        Moving over to the question, whether a default sentence can be  

imposed on default of payment of compensation, this court in the  

case of Hari Singh v. Sukhbir Singh and in Balraj v. State of U.P,  

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has held that it was open to all courts in India to impose a sentence  

on default  of payment of compensation under sub-section (3) of  

Section 357.  In Hari Singh v. Sukhbir Singh (supra), this court has  

noticed  certain  factors  which  requires  to  be  taken  into  

consideration while passing an order under the section:-

“11.  The  payment  by  way  of  compensation  must,  however, be reasonable. What is reasonable, may depend  upon  the  facts  and  circumstances  of  each  case.  The  quantum of compensation may be determined by taking  into account the nature of crime, the justness of claim by  the victim and the ability of accused to pay. If there are  more than one accused they may be asked to pay in equal  terms  unless  their  capacity  to  pay  varies  considerably.  The payment may also vary depending upon the acts of  each  accused.  Reasonable  period  for  payment  of  compensation, if necessary by instalments, may also be  given.  The  Court  may  enforce  the  order  by  imposing  sentence in default.”

22)         This position also finds support in the case of R v. Oliver John  

Huish; [1985] 7 Cr. App. R.(S.) 272.  The Lord Justice Croom –  

Johnson speaking for the Bench has observed:

“When compensation orders may possibly be made the  most careful examination is required.  Documents should  be  obtained  and  evidence  either  on  affidavit  or  orally  should be given.  The proceedings should, if necessary,  be adjourned, in order to arrive at the true state of the  defendant’s affairs.

Very often a compensation order is made and a very light  sentence of imprisonment is imposed, because the court  

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recognizes that if the defendant is to have an opportunity  of paying the compensation he must be enabled to earn  the money with which to do so. The result is therefore an  extremely  light  sentence  of  imprisonment.  If  the  compensation order turns out  to be virtually worthless,  the defendant has got off with a very light sentence of  imprisonment  as  well  as  no order  of  compensation.  In  other  words,  generally  speaking,  he  has  got  off  with  everything.”

23)       The law laid down  in Hari Singh v. Sukhbir Singh (supra) was  

reiterated by this court in the case of Suganthi Suresh Kumar v.  

Jagdeeshan, [(2002) 2 SCC 420]. The court observed:-

“5. In  the  said  decision  this  Court  reminded  all  concerned that it is well to remember the emphasis laid  on the need for making liberal use of Section 357(3) of  the Code.  This was observed by reference to a decision  of this Court in 1989 Cri LJ 116 Hari Singh Vs. Sukhbir  Singh. In the said decision this Court held as follows:-   

“The quantum of compensation may be determined by  taking into account the nature of crime, the justness of  the claim by the victim and the ability of accused to pay.  If there are more than one accused they may be asked to  pay in equal  terms unless their  capacity to pay  varies  considerably.   The  payment  may  also  vary  depending  upon the acts  of each accused.   Reasonable period for  payment  of  compensation,  if  necessary  by  instalments,  may also be given.  The court may enforce the order by  imposing sentence in default.”

       (emphasis supplied)

“10.  That  apart,  Section  431  of  the  Code  has  only  prescribed that any money (other than fine) payable by  

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virtue  of  an  order  made  under  the  Code  shall  be  recoverable "as if it were a fine". Two modes of recovery  of the fine have been indicated in Section 421(1) of the  Code.  The  proviso  to  the  Sub-section  says  that  if  the  sentence directs that in default of payment of the fine, the  offender  shall  be imprisoned,  and if  such offender  has  undergone the whole of such imprisonment in default, no  court shall issue such warrant for levy of the amount.”

             The court further held:-

“11.  When  this  Court  pronounced  in  Hari  Singh v.  Sukhbir Singh (supra) that a court may enforce an order  to pay compensation "by imposing a sentence in default"  it is open to all courts in India to follow the said course.  The said legal position would continue to hold good until  it  is  overruled  by  a  larger  bench  of  this  court.  Hence  learned  single  judge  of  High  Court  of  Kerala  has  committed  an  impropriety  by  expressing  that  the  said  legal direction of this Court should not be followed by  the  subordinate  courts  in  Kerala.  We  express  our  disapproval  of the course adopted by the said judge in  Rajendran v.  Jose 2001 (3) KLT 431. It is unfortunate  that when the Sessions judge has correctly done a course  in accordance with the discipline the Single judge of the  High Court has incorrectly reversed it.”

24)       In  order  to  set  at  rest  the  divergent  opinion expressed  in  

Kunhappu’s  case  (supra),  this  Court  in  the  case  of  Vijayan  v.  

Sadanandan K. and Anr., [(2009) 6 SCC 652], after noticing the  

provision of Section 421 and 431 of Cr.PC, which dealt with mode  

of recovery of fine and Section 64 of IPC,  which empowered the  

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courts  to  provide  for  a  sentence  of  imprisonment  on  default  of  

payment of fine, the Court stated:

“17. We have carefully considered the submissions made  on behalf of the respective parties. Since a decision on  the question raised in this petition is still in a nebulous  state, there appear to be two views as to whether a default  sentence on imprisonment can be imposed in cases where  compensation  is  awarded  to  the  complainant  under  Section 357(3) Cr.P.C. As pointed out by Mr. Basant in  Dilip S. Dahanukar's case, the distinction between a fine  and compensation as understood under Section 357(1)(b)  and Section 357(3) Cr.P.C. had been explained, but the  question as to whether a default sentence clause could be  made in respect of compensation payable under Section  357(3)  Cr.P.C,  which is  central  to  the  decision  in  this  case, had not been considered.”

        The court further held:-

“22. The provisions of Sections 357(3) and 431 Cr.P.C.,  when  read  with  Section  64  IPC,  empower  the  Court,  while making an order for payment of compensation, to  also include a default sentence in case of non-payment of  the same. The observations made by this Court in  Hari  Singh's case (supra) are as important today as they were  when they were made and if, as submitted by Dr. Pillay,  recourse  can  only  be  had  to  Section  421  Cr.P.C.  for  enforcing the same, the very object of Sub-section (3) of  Section  357  would  be  frustrated  and  the  relief  contemplated  therein  would  be  rendered  somewhat  illusory.”

25)      In Shantilal v. State of M.P., [(2007) 11 SCC 243], it is stated,  

that, the sentence of imprisonment for default in payment of a fine  

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or  compensation  is  different  from  a  normal  sentence  of  

imprisonment.  The court also delved into the factors to be taken  

into consideration while passing an order under Section 357(3) of  

the Cr.PC. This court stated:-

“The term of imprisonment in default of payment of fine  is not a sentence. It is a penalty which a person incurs on  account  of  non-payment  of  fine.  The  sentence  is  something which an offender must undergo unless it  is  set aside or remitted in part or in whole either in appeal  or in revision or in other appropriate judicial proceedings  or  “otherwise”.  A  term  of  imprisonment  ordered  in  default of payment of fine stands on a different footing.  A  person  is  required  to  undergo  imprisonment  either  because he is unable to pay the amount of fine or refuses  to pay such amount. He, therefore, can always avoid to  undergo imprisonment in default of payment of fine by  paying such amount. It is, therefore, not only the power,  but the  duty of the court to keep in view the nature of  offence,  circumstances  under  which  it  was  committed,  the  position  of  the  offender  and  other  relevant  considerations  before  ordering  the  offender  to  suffer  imprisonment in default of payment of fine.”

26)      In Kuldip Kaur v. Surinder Singh and anr. (AIR 1989 SC 232),  

in the  context  of  Section 125 Cr.PC observed that  sentencing a  

person to jail is sometimes a mode of enforcement. In this regard  

the court stated:-

“6.  A distinction  has  to  be  drawn between a  mode of  enforcing recovery on the one hand and effecting actual  recovery of the amount of monthly allowance which has  fallen in arrears on the other. Sentencing a person to jail  

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is  a  'mode  of  enforcement'.  It  is  not  a  'mode  of  satisfaction' of the liability. The liability can be satisfied  only by making actual payment of the arrears. The whole  purpose of sending to jail is to oblige a person liable to  pay the monthly allowance who refuses to comply with  the order without sufficient cause, to obey the order and  to make the payment. The purpose of sending him to jail  is not to wipe out the liability which he has refused to  discharge. Be it also realised that a person ordered to pay  monthly allowance can be sent to jail only if he fails to  pay  monthly  allowance  'without  sufficient  cause'  to  comply with the order. It would indeed be strange to hold  that a person who 'without reasonable cause' refuses to  comply  with  the  order  of  the  Court  to  maintain  his  neglected wife or child would be absolved of his liability  merely because he prefers to go to jail. A sentence of jail  is no substitute for the recovery of the amount of monthly  allowance which has fallen in arrears.”

27)       From the above line of cases, it becomes very clear, that, a  

sentence of imprisonment can be granted for default in payment of  

compensation awarded under Section 357(3) of Cr.PC. The whole  

purpose  of  the provision is  to accommodate  the interests  of  the  

victims  in  the  criminal  justice  system.  Sometimes  the  situation  

becomes  such  that  there  is  no  purpose  is  served  by  keeping  a  

person behind bars. Instead directing the accused to pay an amount  

of compensation to the victim or affected party can ensure delivery  

of total justice. Therefore, this grant of compensation is sometimes  

in lieu of sending a person behind bars or in addition to a very light  

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sentence  of  imprisonment.  Hence on default  of  payment  of  this  

compensation,  there  must  be  a  just  recourse.  Not  imposing  a  

sentence of imprisonment would mean allowing the accused to get  

away without paying the compensation and imposing another fine  

would  be  impractical  as  it  would  mean  imposing  a  fine  upon  

another fine and therefore would not ensure proper enforcement of  

the order of compensation. While passing an order under Section  

357(3), it is imperative for the courts to look at the ability and the  

capacity of the accused to pay the same amount as has been laid  

down by the cases above, otherwise the very purpose of granting  

an order of compensation would stand defeated.

28)        Section 421 of Cr.PC reads:-

“421. Warrant for levy of fine. (1) When an offender has been sentenced to pay a the  court passing the sentence make action for the recovery  of the fine in either or- both of the following ways, that is  to say, it may - (a)  Issue  a  warrant  for  the  levy  of  the  amount  by  attachment and sale of any movable property belonging  to the offender  (b)  Issue  a  warrant  to  the  Collector  of  the  district,  authorizing him to realize the amount as arrears of land  revenue  from the  movable  or  immovable  property,  or  both of the defaulters;  Provided that,  if  the sentence directs  that  in default  of  payment  of  the  fine,  the  offender  shall  be imprisoned,  

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and if  such offender has undergone the  whole  of  such  imprisonment  in  default,  no  court  shall  issue  such  warrant  unless,  for  special  reasons  to  be  recorded  in  writing, it considers it necessary so to do, or unless it has  made  an  order  for  the  payment  of  expenses  or  compensation out of the fine under section 357. (2) The State Government may make rules regulating the  manner in which warrants under clause (a) of sub-section  (1)  are  to  be  executed,  and  for  the  summary  determination of any claims made by any person other  than the offender in respect of any property attached in  execution of such warrant. (3)  Where  the  court  issues  a  warrant  to  the  Collector  under  clause (b)  of  sub-section (1),  the Collector  shall  realize the amount in accordance with the law relating to  recovery of arrears of land revenue, as if such warrant  were a certificate issued under such law: Provided that no such warrant shall be executed by the  arrest or detention in prison of the offender.”

              Section 431 of Cr.PC reads:-

“431. Money ordered to be paid recoverable as a fine. Any money (other than a fine) payable by virtue of any  order made under this Code, and the method of recovery  of which is not otherwise expressly provided for, shall be  recoverable as if it were a fine.  Provided that section 421 shall, in its application to an  order  under  section  359,  by  virtue  of  this  section,  be  construed as if in the proviso to sub-section (1) of section  421, after the words and figures "under section 357", the  words  and  figures  "or  an  order  for  payment  of  costs  under section 359" had been inserted.”

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29)       Section 431 clearly provides that an order of compensation  

under Section 357 (3) will be recoverable in the same way as if it  

were a fine. Section 421 further provides the mode of recovery of a  

fine  and  the  section  clearly  provides  that  a  person  can  be  

imprisoned  for  non-payment  of  fine.  Therefore,  going  by  the  

provisions of the code, the intention of the legislature is clearly to  

ensure that mode of recovery of a fine and compensation is on the  

same footing. In light of the aforesaid reasoning, the contention of  

the  accused  that  there  can  be  no  sentence  of  imprisonment  for  

default in payment of compensation under Section 357 (3) should  

fail.  

30)           A similar position is also prevalent in other countries. In the  

United Kingdom, Section 82 (3) of Magistrates’ Courts Act, 1980  

allows for a sentence of imprisonment for default in payment of a  

fine or any financial order. The Section reads:-

“Where on the occasion of the offender’s conviction a  magistrates’  court  does  not  issue  a  warrant  of  commitment  for  a  default  in  paying  any  such  sum as  aforesaid or fix a term of imprisonment under the said  Section 77(2) which is to be served by him in the event  of any such default, it shall not thereafter issue a warrant  of  commitment  for  any  such  default  or  for  want  of  sufficient distress to satisfy such a sum unless:-

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(a)  he is already serving a sentence of custody for life, or  a term of imprisonment, detention in a young offender  institution,  or  detention  under  Section  9  of  the  Criminal Justice Act, 1982; or

(b) the court  has since the  conviction inquired  into  his  means in his presence on at least one occasion.”

31)        In Australia, under Section 4 of the Sentencing Act, 1997 the  

definition of “fine” includes a compensation order. Procedure for  

enforcement of fines is provided for in Section 47(7) of the Act and  

provides for a sentence of imprisonment or default in payment of  

fine.   

32)        The Learned Counsel for the accused has placed reliance on  

the  decision  of  this  court  in  the  case  of  Ettappadan  

Ahammedakutty v. E.P Abdullakeya (Criminal Appeal no. 1013 of  

2007),  which  reiterated  the  position  taken  by  the  Kerala  High  

Court in a case reported in 2000 (2) KLT 349; wherein it was held  

that  no  sentence  of  imprisonment  can  be  passed  on  default  of  

paying compensation awarded under Section 357(3). But in light of  

several decisions reiterating the opposite stand, this case needs to  

be  viewed  in  isolation  and  cannot  be  taken  to  be  against  the  

established position preferred by the Supreme Court on this issue  

over a period of two decades.

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33)          The  complainant  in  the  Civil  Appeal  arising  out  of  

S.L.P.(Crl.)  No.4099  of  2008  has  contended  that  the  sentence  

imposed  for  default  in  payment  of  the  compensation  amount  is  

very  minimal  and,  therefore,  the  sentence  imposed  by the  High  

Court requires to be enhanced. In our considered view, looking into  

the  facts  and  circumstances  of  the  case  and  the  nature  of  the  

offence, we find no good reason to interfere with the quantum of  

sentence imposed.  

34)           The contention of the accused as regards a factual error made  

by the High Court, wherein the High Court stated that the accused  

had  deposited  Rs.  1  lakh  towards  the  compensation  amount  

requires  to  be accepted.   It  is  to  be  noted that  the  accused has  

already deposited Rs.2 lakhs towards the compensation amount of  

Rs. 5 lakhs, before the Judicial Magistrate in pursuance of orders  

passed by the Sessions Court and the High Court. Therefore, the  

appeal of the accused, i.e. Criminal Appeal arising out of Special  

Leave Petition (Crl.) No.334 of 2008 is allowed to the extent that  

he  needs  to  pay  a  further  amount  of  Rs.  3  lakhs  towards  the  

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compensation amount of Rs. 5 lakhs. The remaining part  of the  

sentence passed by the High Court requires to be confirmed.

35)       In the result, the conviction and sentence passed against the  

accused in Criminal Appeal arising out of S.L.P.(Crl.) No.334 of  

2008  are  confirmed  with  the  modification,  as  observed  in  the  

earlier  paragraph.   Criminal  Appeal  arising  out  of  S.L.P.(Crl.)  

No.334 of 2008 is, accordingly, partly allowed.  Since, we are of  

the opinion that modification of the sentence is not warranted in  

the facts and circumstances of the case, Criminal Appeal arising  

out of Special Leave Petition (Crl.) No. 4099 of 2008 filed by the  

complainant is dismissed.   

                 ……………………… …………J.

                                                                                    [ P. SATHASIVAM ]

…………………………………J.  [ H.L. DATTU ]

New Delhi,           May 11, 2010

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