Law relating to Victim Compensation


Every crime produces a victim(s). The victims are generally considered as mere informants or witnesses in criminal trials, assisting the state in its endeavor to punish offenders, are now becoming the focal points of our criminal justice system. The criminal justice system is basically meant to redress the victimization of these victims and to address the issues surrounding him. However getting justice in Indian criminal justice system was never a bed of roses for the victims of offence. The last few decades however witnessed groundbreaking reforms in the approach of legal systems nationally as well as internationally with reforms not only in statutory laws but also even in judicial approach towards the victims of crime.

Victim compensation is one of the major aspects in reparation of the harm or injury caused to the victim due to the commission of the crime. Monetary assistance in one-way or the other always benefits the victims in the mitigation of their sufferings. The renaissance of the prominence of victims in legal system is however a recent phenomenon.

A. Ancient History of Victim Compensation

The ancient Indian History is a witness to the fact that the victims of crimes have sufficient provisions of restitution by way of compensation to injuries. Author of the book, “General Principle of Hindu Jurisprudence” Dr. Priyanath Sen[1] has observed-

It is, however, remarkable that in as much as it was concerned to be the duty of the King to protect the property of his people, if the King could not restore the stolen articles or recover their price for the owner by apprehending the thief, it was deemed to be his duty to pay the price to the owner out of his own treasury, and in his turn he could recover the same from the village officers who by reason of their negligence, were accountable for the thief’s escape.

Reparation or compensation as a form of punishment is found to be recognized from ancient time in India. In ancient Hindu law, during Sutra period, awarding of compensation was treated as a royal right. The law of Manu, requires the offender to pay compensation and pay the expenses of cure in case of injuries to the sufferer and satisfaction to the owner where goods were damaged. In all cases of cutting of a limb, wounding or fetching blood, the assailant shall pay the expenses of a perfect cure or in his failure, both full damages and a fine. It shows that the victim compensation was never an alien concept in the justice delivery systems of the country. The edifice of the law in our present day legal system relating to the victim compensation are provisions contained in the Criminal Procedure Code, 1973 and various judgments of the Hon’ble Supreme Court. The question that arises for consideration is that despite having laws for victim compensation are these laws being satisfactorily used by those on who lies the duty of the execution of these laws and to give beneficial effects to it. Answer is very infrequently. The reasons are many.

Some more prominent are like the 12th century distinction of English law of wrongs into civil wrongs and criminal wrongs which leads to misconception that the area of compensation is something exclusively belonging to the domain of civil law and others less obvious like the ignorance of those who can give effect to these benefactions. The present criminal justice system is based on the assumption that the claims of a victim of crime are sufficiently satisfied by the conviction of the perpetrator. It is a truth that in our present day adversarial legal system between the state and the accused, the victim is not only neglected but is lost in silence. The role of the victim is limited to report the offence and depose in the court on behalf of prosecuting party, which is the State. That’s all. The Malimath Committee reflected on the present criminal justice system that not only the victim’s right to compensation was ignored except as token provision under the Criminal Procedure Code but also the right to participate as the dominant stakeholder in criminal proceedings was taken away from him. He has no right to lead evidence, he cannot challenge the evidence through cross-examination of witnesses nor can he advance arguments to influence decision-making.

B. Compensation to the Victim: Criminal Justice System

Now accepting that there is no uniformity in the legal system in the country to address the issue of compensation to the victims of crime, it is expedient to discuss the legal position in respect of compensation to the victims of the offence. Post independence, the criminal trials were governed by criminal Procedure Codes 1898 and then by 1973 Code (“Cr.PC”). Till the year 2008, there was a provision more or less similar in both the codes for compensation to the victims of the offence that is section 545 in the old Code and section 357 in the new Code.

(i) Ingredients

Section 357 Cr.PC: Order to pay compensation

(1) In case of Conviction and Fine is part of Sentence to Accused

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) Expenses in Prosecution: In covering the expenses properly incurred in the   prosecution;

(b) Compensation to Victim: 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) Compensation in case of Death: When any person is convicted of any offence for having caused the death of another person or of having abetted the commission of such an offence, the fine imposed may be used in paying   compensation to the persons who are covered for relief 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) Compensation of Victim in other Offense: 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 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) Payment of Compensation subject to Appeal

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 has elapsed, or, if an appeal be presented,  before the decision of the appeal.

(3) Sentences without Fine

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 has been so sentenced.

(ii)The Court empowered to impose Compensation

The High Court or Court of Session or appellate court, when exercising its powers of revision may also make an order under aforesaid section. 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.

C. Theory behind the Compensation of Victims

So this was the only provision in Criminal Procedure Code to compensate the victims of offence. The compensation was to be payable by the accused and on his conviction. This provision therefore prescribes the person as well as the circumstance (i.e. conviction of the accused) in which the compensation can be paid to the victim. It is a fact that majority of people who are accused of and are convicted of crimes are poor and therefore this provision of accused depended compensation was never a satisfactory answer to the woes of victims of crime. The payment of compensation by the offender is not possible where there is acquittal or where the offender is not apprehended. Further, the payment remains suspended till the limitation period for the appeal expires or if an appeal is filed, till the appeal is disposed off. The delay in the realization of the amount often adds to the woes of the victim. In that event is it not the duty of the state to compensate the victims of crime. Jeremy Bentham an English jurist and philosopher advocated compensation to victims, holding that, “satisfaction” should be drawn from the offender’s property, but if the offender is without property…. It ought to be furnished out of the public treasury, because it is an object of public good. Jeremy Bentham advocated the theory of strict liability, which claims that compensation should be awarded because the social contract between the victim and his government has been broken. That is, the victim has a legal claim against the state for its failure to prevent the crime that produced the victimization. Since the government limits the ability of the individual to protect him and instead gives that power to law enforcement personnel and taxes the individual to support those personnel, then the victim can hold the government liable when its law enforcement activities are unsuccessful. And, the case against the government is enhanced when one considers the barriers it creates against the victims being restituted by the offender, including the aforementioned doctrine of mutuality which limits the chances of civil recovery, and the states imprisonment of the offender-which impedes his ability to reimburse the victim2.

D. Recommendations, Judicial Activism and Amendment to include Victim Compensation in Judicial System

The states duty to rehabilitate the victim of crime cannot be put any lower than its responsibility of rehabilitating the criminal. In India, however the state remained itself away from this obligation of compensating the victims till 2008, when the Criminal procedure Code was amended to impose a liability on state for such compensations. The 14th Law Commission in its report recommended state compensation, which is justified on the grounds that it is the political, economic and social institutions of the state system that generates crime by poverty, discrimination, unemployment and insecurity. The Malimath Committee3 was also of the view that the principle of compensating victims of crime has for long been recognized by the law though it is recognized more as a token relief rather than part of a punishment or substantial remedy. Victim compensation is a State obligation in all-serious crimes, whether the offender is apprehended or not, convicted or acquitted. This is to be organized in a separate legislation by Parliament.

Victim compensation is an important aspect of victim restitution in criminal justice system. Supreme Court judgment recently in the case of Ankur Shivaji Gaikwad Vs. State of Maharashtra[2], has observed that a long line of judicial pronouncements of Supreme Court of India recognized a paradigm shift in the approach to victims of crime who are held entitled to reparation, restitution or compensation for loss or injury suffered by them.

It is in consonance with this shift in the approach towards victims for compensating them that an amendment was made in the Code of Criminal Procedure, 1973 whereby a new provision i.e. Section 357 A has been added which provides for the Victim Compensation Scheme. Earlier a provision for compensation to the victims of crime was section 357 Code of Criminal Procedure in which the mandate was a direction to the convict to pay compensation to the victims of crime, if the court on conviction of accused so directs. However in many cases as we see that the convicts are from very poor back ground or are reluctant to pay compensation considering their prolonged incarcerations, the victims seems to be remediless.

(i)      New Provision for Victim Compensation

It appears that in order to overcome the situation, a new section 357 A Code of Criminal Procedure was added in the Code of Criminal Procedure by an amendment in the year 2009. This was the much-needed relief to the victims of offences and therefore one of the most progressive legislation in recent times. It reads as-

Section 357A of CrPC- Victim compensation scheme

(1) Scheme for Compensation: Every State Government in co-ordination with the Central Government shall prepare a scheme for providing funds for the purpose of compensation to the victim or his dependents who have suffered loss or injury as a result of the crime and who require rehabilitation. The purpose of preparing the scheme by the state governments in consultation with the central government was to have uniform schemes of victim compensation throughout India but this was probably not done while preparing the schemes and the result is that there is great disparity in compensations to victims in these schemes.

(2) Power to Decide Quantum of Compensation: Whenever a recommendation is made by the Court for compensation, the District or the State Legal Service Authority, as the case may be, shall decide the quantum of compensation to be awarded under the scheme aforesaid.

(3) Inadequate Compensation/Compensation in case of Acquittal or Discharge: If the trial Court, at the conclusion of the trial, is satisfied, that the compensation awarded under section 357 is not adequate for such rehabilitation, or where the cases end in acquittal or discharge and the victim has to be rehabilitated, it may make recommendation for compensation.

(4) Compensation when Offender is Untraceable: Where the offender is not traced or identified, but the victim is identified, and where no trial takes place, the victim or his dependents may make an application to the State or the District Legal Services Authority for award of compensation which shall be decided after due enquiry award adequate compensation by completing the enquiry within two months.

(5) Collateral Relief to Victim: The State or the District Legal Services Authority, as the case may be, to lessen the suffering of the victim, may order for immediate first-aid facility or medical benefits to be made available free of cost on the certificate of the police officer not below the rank of the officer in charge of the police station or a Magistrate of the area concerned, or any other interim relief as the appropriate authority deems fit.

(ii)    Position of States in Victim Compensation

In Goa there is a provision of compensation of Rs Ten Lacs to the rape victim whereas the scheme of Delhi provides for Rs Three lacs as maximum compensation with states like UP having provisions of further low compensations to such victims. However, in order to avoid these disparities the Supreme Court has given a landmark judgment in Suresh vs. State of Haryana[3] observed that there is need to consider upward revision in the scale for compensation in victim compensation schemes and pending such consideration Authorities are directed to adopt the scale notified by the State of Kerala in its scheme, unless the scale awarded by any other State or Union Territory is higher. It will therefore mean that if a victim compensation Scheme of a State prescribes lesser compensation for some offence, then in that event, the victim compensation scheme of the State of Kerala has to be followed. This has an effect of making compensations uniform throughout the country if followed in its right spirit. The Government of Delhi in compliance of section 357A Code of Criminal Procedure has framed a Victim Compensation Scheme for Delhi called as ‘’Delhi Victim Compensation Scheme, 2011’’. It has come into force on 02.02.2012.   The Nodal agency for deciding the quantum of compensation under the Victim Compensation Scheme is the District or the State Legal Services Authority, as the case may be. Clause 1 also speaks of creating a fund under the scheme.

E. Section 357 read with Section 357A of the CrPC.

Under this provision 357 A Code of Criminal Procedure, the State is also liable to pay compensation to the victims of crime apart from the accused under section 357 Code of Criminal Procedure. There are many situations after the commission of the offences in which the compensation can be awarded.

  • At the conclusion of the trial.
  • Inadequate compensation
  • Accused not traceable or no trial commenced

Earlier under section 357, the compensation was awarded only in the eventuality of the conviction of the accused but now not only on conviction but also on acquittal or discharge of the accused or in case of untraced status of the accused, compensation can be granted. This is a positive development that takes into account practical reality of an already crumbling criminal justice system, which is not in a position to bring to book all offenders. It means that the new section 357 A Code of Criminal Procedure has substantially widened the scope of compensating the victims of crimes.

F. Other Relevant Provisions for Victim Compensation

(i)   Section 372 CrPC

Section 372 of the Cr.PC. has been amended, containing the following proviso: “Provided that the victim shall have a right to prefer an appeal against any order passed by the Court acquitting the accused or convicting for a lesser offence or imposing inadequate compensation, and such appeal shall lie to the Court to which an appeal ordinarily lies against the order of conviction of such Court.”

(ii)    Meaning of ‘Dependent’

The term ‘’Dependent’’ of victim has been defined in the Delhi Victim Compensation Scheme. Dependent includes wife, husband, father, mother, unmarried daughter and minor children of the victim as determined by the authority empowered to issue dependency certificate that is Collector, or any other authority authorized by the Government.

(iii)  Victim Compensation Disbursement

(1)     Procedure for Disbursement of Compensation

For disbursement of compensation to the victim, there shall be a fund called ‘’The Victim Compensation Fund’’ from which the amount of compensation, as decided by the DLSA has to be paid to the victim or to her dependents. The procedure for granting compensation is provided in section 5 of the aforesaid scheme. Whenever the court makes recommendation for compensation:

  • The DLSA, examines the case, verify the contents of the claim with regard to the loss or injury or rehabilitation as a result of crime and may also called for any other relevant information necessary for consideration of the claim.
  • The quantum of compensation has to be decided by DLSA on the basis of loss or injury or requirement for rehabilitation, medical expenses to be incurred on treatment and such incidental charges, such as funeral expenses etc.
  • The compensation has to be deposited in a Nationalized Bank of the victim or her dependents.
  • Out of the amount so deposited, 75 per cent of the same is put in a fixed deposit for a minimum period of three years and the remaining 25 per cent shall be available for the utilization and initial expenses by the victim as the case may be.
  • In case of a minor, 80 per cent amount of the compensation is to be deposited which can be drawn only on attainment of the age of majority, but not before three years of the deposition. However, in exceptional cases, the aforesaid amount may be withdrawn for educational or medical needs of the beneficiary at the discretion of DLSA.
  • The interest on the same has to be credited directly by the bank in the saving account of the victim/dependent on monthly basis.
  • This scheme also provides for the provision of immediate first aid and medical benefit or any other interim relief to the victim on a certificate of a police officer not below the rank of officer in-charge of police station or a Magistrate of the area concerned.
  • Legal Services Authorities also provides interim compensation in suitable cases where the victim needs immediate medical treatment/rehabilitation. Such interim compensation can be payable on recommendations of SHO concerned and Magistrate dealing with the case. This interim compensation is provided under section 8 of the scheme.
  • Legal Services Authority also has the power to institute legal proceedings before competent court of law for recovery of compensation granted to the victim/his or her dependents from the persons responsible for causing loss or injury as a result of crime. In this regard it also worthwhile to mention that the courts may also grant interim compensation to the victims. The relevant judgments are Shri Bodhisattwa Gautam vs Miss Subhra Chakraborty[4] and Suresh vs State of Haryana[5]

(2)     Limitation and Limit of Compensation

Victim Compensation Scheme also has a schedule providing for minimum and maximum amount of compensation in different categories of offences. The quantum of compensation cannot be less than a minimum amount and cannot be more than the maximum amount provided in the schedule attached to the Victim Compensation Scheme. For example in cases of rape the minimum amount of compensation that can be recommended is Rs. 2 lacs and maximum as Rs. 3 lacs. The limitation period for filing a claim Under section 357(4) Code of Criminal Procedure is in cases when the offender cannot be traced or identified is 3 years from the date of occurrence of crime.

(3)     Precedents

The judicial response has always been positive in dealing with the benevolent provisions of compensation. In Hari Krishna & State of Haryana v. Sukhbir Singh[6], Supreme Court judgment mandated courts to exercise Section 357 liberally and award adequate compensation, particularly in cases where the accused is released on admonition, probation or when the parties enter into a compromise. At the same time, the court cautioned that the compensation must be reasonable, fair and just; taking into account the facts and circumstances of each case, nature of the crime, veracity of the claim and ability of the accused to pay. The court further observed that 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 the crime and the ability of the accused to pay. If perhaps, there are more than one accused they may be asked to pay in equal terms, unless their capacity to pay varies considerably. A reasonable period for payment of compensation, if necessary by installment, may also be given. The court may enforce the order by imposing sentence in default. Thus, the court must be satisfied that the victim has suffered loss or injury due to the act, neglect or default of the accused to be entitled to recover compensation. This loss or injury may be physical, mental or pecuniary.

Recently again the Supreme Court in Ankush Shivaji Gaikwads(supra) while considering the amended provision of Code of Criminal Procedure reiterated its view and further impressed that now the courts have to give reasons for not compensating the victim while deciding the case. The court observed that the amendments to the Code of Criminal Procedure brought about in 2008 focused heavily on the rights of victims in a criminal trial, particularly in trials relating to sexual offences. Though the 2008 amendments left Section 357 unchanged, they introduced Section 357A under which the Court is empowered to direct the State to pay compensation to the victim in such cases where the compensation awarded under Section 357 is not adequate for such rehabilitation, or where the case ends in acquittal or discharge and the victim has to be rehabilitated. Under this provision, even if the accused is not tried but the victim needs to be rehabilitated, the victim may request the State or District Legal Services Authority to award him/her compensation. This provision was introduced due to the recommendations made by the Law Commission of India in its 152nd and 54th Reports in 1994 and 1996 respectively. In India the principles of compensation to crime victims need to be reviewed and expanded to cover all cases. The compensation should not be limited only to fines, penalties and forfeitures realized. The State should accept the principle of providing assistance to victims out of its own funds.

The court summed up its judgment as follows:

 “While the award or refusal of compensation in a particular case may be within the Court’s discretion, there exists a mandatory duty on the Court to apply its mind to the question in every criminal case. Application of mind to the question is best disclosed by recording reasons for awarding/refusing compensation. It is axiomatic that for any exercise involving application of mind, the Court ought to have the necessary material, which it would evaluate to arrive at a fair and reasonable conclusion. It is also beyond dispute that the occasion to consider the question of award of compensation would logically arise only after the court records a conviction of the accused. Capacity of the accused to pay which constitutes an important aspect of any order under Section 357 Code of Criminal Procedure would involve a certain enquiry albeit summary unless of course the facts as emerging in the course of the trial are so clear that the court considers it unnecessary to do so. Such an enquiry can precede an order on sentence to enable the court to take a view, both on the question of sentence and compensation that it may in its wisdom decide to award to the victim or his/her family.”

The prominent feature of this judgment is that now the courts are obliged to give reasons for not recommending compensation to the victims of the crime. Now concluding with the hope that the judgment of Supreme Court in Ankush Shivaji Gaikwads (supra) case gets due attention from all those who are concerned with the administration of criminal justice system and that in the changed legal scenario in favour of the victims, this “neglected and forgotten lot” called victims may not again be lost in oblivion groping in the dark for their precious rights of compensation for their injuries.


There are provisions for compensation to the victims of crime in Cr.PC.

  • The compensation is to be provided by Legal Service Authorities on the recommendation of Courts.
  • The compensation can be interim that is during investigation or trial or can be final at the conclusion of the trial.
  • The compensation is payable according to the ‘Victim Compensation Schemes’ of respective States.
  • The courts have to give reasons in case it is not recommending compensation to the victims of crime at the conclusion of the trial.

Book References

Robert Ilias- “Victims Of The System” ED. 1983 page 24

Report of Committee on Reforms of Criminal Justice System, Ministry of Home Affairs, Government of India (2003)Vol.1

[1] Dr. Priyanath Sen: “General Principle of Hindu Jurisprudence”, Page 335

[2] S.L.P. (Crl.) No.6287 of 2011

[3] Criminal Appeal NO. 420 of 2012

[4] 1996 AIR 922

[5] Criminal Appeal No. 420 of 2012

[6] (1988) 4 S.C.C. 551

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