Research Task-1

Compensation
1. What do you mean by Compensation?

Compensation as a Constitutional Right

According to the view of the liberal world, respect for human rights also mean,
providing adequate relief if those human rights are violated. The right of
compensation for the violation of fundamental rights is derived from the rights that
were violated. As a matter of fact, it is inherent in them, for example, a person’s right
over his body, makes the other duty bound and forbids him to attack or injure without
any justification. Moreover, this right over one’s body also gives him the right to
compensation if he’s attacked unjustifiably, in order to help the him recover mentally
and physically. Compensation is both acknowledgement of the violated right and an
attempt to reimburse for the damage.

In India, to fill the gap in the fundamental right to compensation, the apex court has
found the monetary way to expiate the abuse of the human rights. The Supreme
Court in Rudal Shah v. State of Bihar, for the very first time laid down the principle
that compensation can be given in the cases where any fundamental right of an
individual has been injured and that the higher courts have the authority to do so by
using the writ jurisdiction and evolved the principle of compensatory jurisprudence .

Rudal Shah v. State of Bihar

The facts involve the petitioner who was even after being acquitted by the Court of
Sessions, Bihar on June 3, 1968, was released from the jail only on October 16,
1982, that is after more than 14 years. The petitioner thus filed the writ of habeas
corpus on the grounds that his detention was illegal and unlawful. He had also
asked from the

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courts for certain additional reliefs like rehabilitation, reimbursements for medical
expenses, and compensation for the unlawful confinement.

Furthermore, the reply given by the Jailor’s affidavit stated that the petitioner was
acquitted but not released since he was of unsound mind when the order for his
acquittal was passed. But, this affidavit by the jailor disclosed no data on the basis of
which he was adjudged insane, or about any specific measures are taken to cure his
illness. Moreover, what was even more important to note was that, whether or not it
took 14 years to cure his mental imbalance. It is also to be taken into account that,
there was no medical opinion produced to support the fact that he was medically
insane, and that no jail record showing as to what kind of medical treatment he was
being given, existed.

The Supreme Court elaborately discusses the question as to whether or not an

order for the payment of money can be passed by the Supreme Court under the Writ
Jurisdiction on the consequential deprivation of a fundamental right. Justice
Chandrachud said, “Article 21 which guarantees the right to life and liberty will be
denuded of its significant content if the power of this Court were limited to passing
orders to release from illegal detention. One of the telling ways in which the violation
of that right can reasonably be prevented and due compliance with the mandate of
Article 21 secured, is to mulct its violators in the payment of monetary
compensation. Administrative sclerosis leading to flagrant infringements of
fundamental rights cannot be corrected by any other method open to the judiciary to
adopt. The right to compensation is some palliative for the unlawful acts of
instrumentalities which act in the name of public interest and which present for their
protection the powers of the State as a shield.”

Therefore, the Supreme Court clearly condemned the State authorities for its actions
and had ordered for a compensation of Rs. 30,000/-.

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The decision of Rudal Shah was important in two aspects:

That violation of a fundamental right can lead to a civil liability; It also formulates the
bases for a theory of liability.

The decision focused extreme concern to protect and presents the fundamental right
of a citizen than the sovereign and non-sovereign dichotomy.

According to the court, the compensation was in the nature of a palliative, i.e.,
comforting to the victim, in order to give better meaning to article 21.

Development Post Rudal Shah’s Case

After the pronouncement of the Rudal Shah’s case, another case of Sebastian
Hongray v. Union of India came up before the Supreme Court of India, wherein, the
State failed to reproduce two persons missing from the army custody. The Courts
ordered for the respondents to pay Rs. 1 lac each to the wives of the two missing
persons. This was followed by the case of Bhim Singh v. State of J & K. In this case,
the Court opined that it could set right a wrong complained of in respect of his arrest
and violation of his rights by awarding compensation. It deviated from the rule as laid
in the above two cases of Rudal Shah and Sebastian Hongray, i.e., of the rule of
Habeas Corpus being remedial, and thereby made it punitive. It forms both, a
mixture of palliative compensation and exemplary costs.

In yet another case, Saheli v. Commissioner of Police, the reasons for the award of
compensation was being expounded. The State was held liable for the death of a
nine-year-old child by Police assault beating. The Court said that an action for
damages lies for bodily harm, including battery, assault, false imprisonment,
physical injuries and death, since damages represented a solatium for mental pain,
distress, indignity, loss of liberty and death.

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Furthermore, the Supreme Court in the case of Nilabati Behera v. State of Orissa
gave the jurisprudential reasoning behind the award of damages in cases of
violations of fundamental rights. The petitioner was awarded compensation for the
death of her son in the police custody. The Court held that, the principle of sovereign
immunity does not apply to the public law remedies under Article 32 and Art 226,
and said that, “a claim in public law for compensation for contravention of human
rights and fundamental freedoms, the protection remedy for enforcement and
protection of such rights and such a claim based on strict liability made by taking
recourse to constitutional remedy provided for the implementation of fundamental
right is separate from and in addition to the remedy in private law damages for tort.”

In M.C. Mehta v. Kamal Nath, the SC held that it has power under Article 32 to
award compensation to the victims of the pollution.

Relying on the three major judgements of Rudal Shah, Sebastian Hongray, and
Bhim Singh, the Andhra Pradesh High Court stated that Kasturi Lai’s Case has no
application where there is a deprivation of life or personal liberty. The Andhra
Pradesh High Court noted down the recommendations of the Law Commission first
report for statutory recognizing the liability of the State.

This case opened a new outlook for individual action against the State as Article 300
has been held not to be an exception to Article 21.

Compensation Under Code of Criminal Procedure, 1973

The Code of Criminal Procedure (hereinafter referred to as CrPC) initially provided

for the compensation to victims of crime under sections 357, to be given by the
accused. With due course of time, the Courts in India realized that, in punishing the
offender, it ignored the victim. It was only in the year 2008 when the CrPC was
amended to impose a liability on the State for such compensations, based on the

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recommendations of the Malimath Committee. It stated that compensation should be

provided to the victim, as not only as a token of relief but also as part of the
substantial remedy. It justified it on the grounds that it is the political, economic, and
social institutions of the State that generates crime by poverty, discrimination,
unemployment and insecurity, and therefore made it obligatory for the State to
provide victim compensation in all serious crimes, whether the offender is convicted
or acquitted.

Victim Compensation Scheme Post Amendment of 2008

357 had a few limitations, for example, as it was held in R. Vijayan v. Baby, wherein
the Court held that “if compensation could be paid from out of the fine, there is no
need to award separate compensation. Only where the sentence does not include
fine but only imprisonment and court finds that the person who has suffered any loss
or injury by reason of the act of the accused person, requires to be compensated, it
is permitted to award compensation under section 357 (3)”, the Parliament post
recommendations of the Malimath Committee added S. 357A to S. 357D. The
Amendment Act, 2008 also provides for the right to appeal against an order
imposing inadequate compensation.

1. Budget allocation by the State Governments

357A (1) directs every State Government to prepare a scheme for providing funds
for the purpose of compensation to the victim or his dependents, who have suffered
loss or injury, and who require rehabilitation. It requires every state government to
create a victim compensation fund, which would have budgetary allocation. Sadly,
only a few state governments have framed the scheme for providing the funds for
compensation. Even in the States which have made a scheme have, the eligibility
criteria to get compensation along with the procedure different from each other.
There is thus, no
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uniformity neither in subject- matter nor in the amount of compensation. In Hari

Singh and State of Haryana v. Sukhbir Singh, it was held by the Court that, victim
compensation is a “measure responding appropriately to crime as well as reconciling
the victim with the offender and indeed a step forward and in our criminal justice
system.” However, the application of these provisions, are yet to be put in practice.

2. Additional Compensation

357B provides that the compensation to be paid by the State Government u/s 357A
is to be paid in addition to the payment of fine to the victim given u/s 326 A or 376-
D.

3. Treatment of Victims

357C provides for immediate medical relief, free of cost, to the victims of any offence
covered u/s 326 A, 376, 376 A, 376 B, 376 C, 376 D or u/s 376 E of the Indian Penal
Code, and shall immediately inform the police of such incident, in every hospital,
public or private.

4. Quantum of Compensation

According to S. 357 A (), whenever the recommendation is made by the Court for
compensation, the District or the State Legal Service Authority, shall decide the
quantum of compensation to be awarded under the scheme aforesaid.

5. Compensation when the Offender is not found

Where the offender is not traceable or is not identified, or is absconding, 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.

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Compensation For Acid Attack Victims

Acid attack is one of the most brutal crimes, which just not leave scars on the victim,
but also violates the very basic human rights of the victim. The Law Commission
took suo moto view of the contentions raised in the case of Lakshmi v. UOI. The
Commission felt that no definition of grievous hurt would be enough to cover the
various kind of injuries caused due to an acid attack. Moreover, the commission also
suggested the government to propose a law known as Criminal Injuries
Compensation Act, providing both interim and final monetary compensation to
victims of certain acts of violence like Rape, Sexual Assault, Acid Attacks, etc., also
providing for their medical and other expenses relating to rehabilitation, loss of
earnings etc.

The Government of India took the matter seriously and passed the necessary
amendments. The amendment resulted in the insertion of sections 326A and 326B.
U/s 326A the punishment includes a sentence not less than 10 years, and also fine,
which shall be just and reasonable to meet the medical expenses of the treatment of
the victim, and that any other such fine imposed should be entirely paid to the victim.
Also, the addition of 357B, as mentioned provided for compensation by the State
Government to be in addition to the payment of fine to the victim u/s 326A.

Compensation Under A Few Special Laws

1. The Motor Vehicles Act, 1988

Increased number of motor vehicles, poor maintenance of roads and negligence by

drivers has led to the increase in the road accidents, resulting in death or injuries to

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victims. To curb this menace, S. 40 of the MV Act, embodies the idea of compulsory
compensatory jurisprudence for the benefit of victims of road accidents. It makes the

owner of the vehicle obliged to pay a specific sum of compensation if the negligent
act of the driver has caused death or permanent disablement of a person.163
provides for a scheme of payment of compensation in case of hit and run motor
accidents which shall contain the form, manner, and the time within which
applications for compensation may be made, to whom it may be made, and the
procedures to be followed by administrative authorities constituted under the Act.
Furthermore, S. 163- A, provides for compensation in a structured format as
mentioned in the second schedule of the Act. Under this Section, the victim is
entitled to compensation on a fault- liability, based on the Second Schedule.

2. Workmen Compensation Act, 1923

This Act provides compensation to workmen, by their employers for injuries caused
by an accident occurred during or in the course of employment. S. 3 obliges the
employers to pay the compensation in respect of:

Any injury which resulted in the total or partial disablement of the workman for a
period exceeding seven days;

Any injury resulting in the death caused by an accident which was not caused due
to the workman having been under the influence of alcohol or any other drugs, or
any willful disobedience of the workman to an order which was expressly given, or
any safety measure provided.

The Schedules I, III, and IV, annexed in the Act, lays down the process of
determination of payment of compensation by enlisting the injuries that might result
in permanent partial disablement, and the occupational diseases that might be
caused.

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3. Compensation in Medical Negligence Cases

In the landmark case of Jacob Mathew v. State of Punjab, and also in the case
Suresh Gupta v. Govt. of NCT, Delhi, the Supreme Court has relaxed the norms for
doctors with regard to criminal liability for medical negligence by adding the
requirement of “gross” medical negligence. However, the culpability of doctors
through civil liability has been recognized by the Courts. In the recent judgement of
2014 of, Balram Prasad v. Kunal Saha, the SC awarded a compensation of Rs. 11
Crore to a victim, who was paid by the doctors and the private hospital deemed
responsible for the wrongful death of a patient. This was by far the largest ever given
in case of medical negligence. The basis of computing compensation under
common law lies in the principle of “Restitutio in Integrum”, which means, that the
person seeking damages due to a wrong committed to him/ her is in the position that
he/ she would have been had the wrong not been committed. Inconsistency in
awarding compensation in medical negligence cases is a problem that currently
plagues the Indian health sector. Each and every case has to be considered
independently because of would be inappropriate to not give the facts of every
situation due to importance. The Supreme Court in Sarla Verma v. Delhi Transport
Corporation noted that: “The lack of uniformity and consistency in awarding
compensation has been a matter of grave concern… If different tribunals calculate
compensation differently on the same facts, the claimant, the litigant, the common
man will be confused, perplexed, and bewildered. If there is significant divergence
among tribunals in determining the quantum of compensation on similar facts, it will
lead to dissatisfaction and distrust in the system.” The dilemma that judges face
while awarding compensation in medical negligence cases because:

Law is required to protect a patient’s rights and

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The law also needs to provide due sovereignty to a profession that by all
definitions are an inexact science.

The Indian legal system addresses medical negligence mainly through the
consumer courts. The policy impact of being included under the purview of the
Consumer Protection Act, 1987, is that the treatment provided by a doctor which by
all definitions, an inexact and variable science with rapid advancement and
substantial responsibility, is subject to the same scrutiny as any other service
provider, therefore increasing the propensity of the system to solve such matters
purely by awarding compensation.

According to a few, large compensation is considered an ideal remedy for medical

negligence because it acts as in insurance to the victim, retribution towards
negligent doctors and hospitals, and as a deterrent to other doctors/ hospitals. The
counter- arguments include an increase in defensive medicine, professional liability
premiums, and treatment costs as symptoms of a dysfunctional system created to
reward the litigious and punish the professionals.

Now, for the question as to who shall be responsible for paying compensation, the
doctor or the hospital, it has been seen that nowadays, the hospitals as an
organization in most cases today is run not by the doctors but by the administrators.
In many cases, both doctors and the hospitals have been held responsible for
paying compensation, since, in the majority of the cases, an individual doctor may
not be in a position to pay the huge compensation until the hospitals are also made
a party in the litigation.

Therefore, we can see that the calculation of compensation is not precise or

accurate, and is bound to vary from case to case. This results in the subjectivity of
presiding judges, which erodes faith in the justice system. Hence, there is an urgent
need to introduce certain broad guidelines, assessment parameters to support the
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health system in providing quality health care. The compensation awarded needs to
be just, reasonable, and prudent.

Is Compensation Palliative or Punitive??

The nature of monetary relief that a petitioner would be entitled to be of crucial

nature. A brief overlook over these cases shows that in all of them the compensation
given was palliative in nature or as exemplary costs. In many of the judgements, the
Supreme Court also concluded that the award of money in the writ would not
exclude a claim to damages in a civil court. Though, the palliative compensation is
done away with the decision of the Supreme Court in Bhim Singh’s case. However,
the mentioning of the remedy available with the civil court has been done away with
due to two reasons-

to ensure that the writ courts do not become submerged with litigation, and

to do away with the cumbersome process of appreciation of evidence and to

calculate the damages payable.

Also, in earlier decisions, the Courts used the concept of the ‘shocking of
conscience’ as an indicator to warrant compensation. But, that was also done away
with the Behera’s case.

Conclusion

The jurisprudence of compensation is relatively young but has made significant

headway since the Rudal Shah’ Case. The new remedy has proved a godsend to
many and has provided a substantial shot in the arm in the role of the Courts as
protectors of human rights. The failings of the common law of torts are now
redressed to a good extent. The judicial initiative is a welcome step, but it is only a
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guiding star in the long struggle of Rudal Shah’s and Saheli’s who grope under the
reign of terror of a politicized bureaucracy or bureaucratized politicians and other
leviathans collectively manifested in the monster known as the State. The trend is
thus clearly a

step in the right discretion. But it must also be noted that it has been observed in
only a small minority of cases. The judiciary must use the provision of compensation
to grant relief in appropriate cases. The lawyers engaged in such matter may also,
contribute by including in their pleadings, a prayer for compensation. To sum up, this
area promises to be an interesting one for future research.

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2. What are the Compensations that are payable under
different provisions of the law in India?

Mainly the types of compensation that are payable under different provisions of the
law in India is classified under 2 categories i.e. Financial Compensation and Non-
Financial Compensation.

Financial Compensation-

Financial compensation is most popular and important compensation that is given in

the form of money. It is the most important motivational factor that satisfies
employees’ basic needs like food, clothing, etc. The most well-recognized form of
competition, and probably the first type of compensation sought by workers, is direct
compensation. Direct compensation is the money directly paid to employees in
exchange for their labor. Direct compensation includes wages, salaries, bonuses,
tips and commissions.

It is further categorized into two parts:

I. Direct Compensation:

The monetary benefit offered by an organization to its employees in return for their
service is called direct compensation. This includes an employee’s base pay (hourly
wage or annual salary), performance-based variable pay, bonuses (rewards for
special occasions or exceptional performance) as well as stock options (a right to
purchase a part of business as a reward for exceptional service).

Types of direct compensation

Some of the key components of direct compensation are discussed below.

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Salary and wage

Direct compensation includes basic annual salaries or hourly wages paid to workers
in return for their services to the company account. It refers to the monetary benefits
received for work done for a specific duration like an hour, a week, a month or a
year. It includes workers’ financial compensation payments, contractual payments,
pay for unscheduled time, and overtime, as well as any retroactive pay.

Car allowance

Companies may offer their employees the use of a car and/or a fuel allowance. They
may also cover the cost of parking, public transportation, or cab fare for the
employee.

Housing allowance

If workers have to relocate because of work, companies may provide their workers
with a housing allowance. Some companies even provide accommodation to
facilitate the process of relocation.

Medical reimbursement

Companies may offer workers medical reimbursements for medical claims covering
not only workers themselves, but also their family members. The claims include
reimbursement for medical bills as well as health insurance.

Leave travel allowance

Some organizations provide their employees with leave and an allowance for
recreational travel. These allowances are scaled based on the employee position
and length of service with the company.

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Special/Other allowance

Direct compensation also covers some special allowances. These include meals,
commissions, mobile phone expenses, travel expenses, club memberships,
insurance, reduced interest loans, and more.

Other direct compensation options include incentive pay linked to exceptional

performance and occasional bonuses for special occasions.

II. Indirect Compensation:

Another tool available to Anne is indirect financial compensation. Indirect financial

compensation is a benefit given to an employee that has financial value, but is not a
direct monetary payment. It is often referred to as a non-cash benefit. In certain
circumstances, these non-cash benefits may be more valuable to an employee than
a high salary or wage. Let's take a quick look at some examples.

Group medical insurance coverage is often a coveted benefit. Employer-sponsored

medical insurance may be the only way an employee with a sick spouse can afford
health insurance and offers quite an inducement to come aboard and stay with the
company. Anne can examine the company's current group plan and make sure it's
up to par and perhaps beat what the other factory is offering. Supplementing group
medical with group dental coverage, short-term and long-term disability insurance,
and life insurance can provide employees with a sense of security for themselves
and their families.

Retirement plans can also offer an attractive incentive. If a company offers a defined
benefit plan, it's promising to pay a certain amount of retirement benefits to an
employee upon the employee's retirement. You can think of it like a private-sector
social security payment - a set amount each month for life.

On the other hand, if the company offers a defined contribution plan, such as a
401(k) plan, it will contribute a certain amount of money each year to the employee's

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individual retirement account. Offering a generous matching contribution to the

employee's contributions to the plan can offer a great incentive. Most people don't
want to work until they die, so Anne will want to make sure her company's retirement
plan is competitive with other companies in the area.

Stock options and profit sharing programs are not only an incentive for employees to
stay but also provide an incentive for employees to be more productive because
employees share in the gains. An employee stock option is the right to buy company
stock at a certain price during a certain period of time.

Anne can also extend the company's employee services. These are services that
employees receive from the company, such as counseling, legal referral, career
planning, wellness plans and fitness club memberships.

Types of direct compensation

Leave Policy

It is the right of employee to get adequate number of leave while working with the
organization. The organizations provide for paid leaves such as, casual leaves,
medical leaves (sick leave), and maternity leaves, statutory pay, etc.

Overtime Policy

Employees should be provided with the adequate allowances and facilities during
their overtime, if they happened to do so, such as transport facilities, overtime pay,
etc.

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Hospitalization

The employees should be provided

allowances to get their regular check-
ups, say at an interval of one year.
Even their dependents should be
eligible for the medi-claims that
provide them emotional and social
security.

Insurance

Organizations also provide for accidental insurance and life insurance for
employees. This gives them the emotional security and they feel themselves valued
in the organization.

Leave Travel

The employees are provided with leaves and travel allowances to go for holiday with
their families. Some organizations arrange for a tour for the employees of the
organization. This is usually done to make the employees stress free.

Retirement Benefits

Organizations provide for pension plans and other benefits for their employees
which benefits them after they retire from the organization at the prescribed age.

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Holiday Homes

Organizations provide for holiday homes and guest house for their employees at
different locations. These holiday homes are usually located in hill station and other
most wanted holiday spots. The organizations make sure that the employees do not
face any kind of difficulties during their stay in the guest house.

Flexible Timings

Organizations provide for flexible timings to the employees who cannot come to
work during normal shifts due to their personal problems and valid reasons.

Non-Financial Compensation-

Indirect compensation isn’t always in the form of cash. Indirect compensation can
also encompass the benefits your company offers employees. These benefits
include anything monetary that is sponsored by your organization, such as health
insurance or the contributions your company makes to an employee’s 401(k)
retirement plan. Additionally, if your organization offers stock options or profit-
sharing, those might be counted as indirect compensation as well. Finally, tuition
reimbursement or assistance, company-paid services such as a gym membership or
dry cleaning, and other things of that nature also qualify as indirect compensation.
There are other forms of indirect compensation, which we will go into more detail
about later in this article.

Reasons why Indirect Compensation matters:

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Compensation management is one of the cornerstones of effective human
resources management. A strong compensation plan helps your organization attract
and retain

the best and brightest employees. There are three main reasons why indirect
compensation matters:

1) Indirect compensation makes your company competitive:

The most important reason for providing indirect compensation is to show
your employees that your organization cares about them, values their
contributions, and wants to ensure their needs are met to the best of your
company’s ability. Additionally, all other things being equal (direct
compensation, job description, etc.), your company’s benefits package could
tip the scales in your favor, making your company’s pay brand more
competitive and attractive. According to Glassdoor, 57 percent of candidates
in 2016 reported benefits being among their top considerations before
accepting a job.

2) Indirect compensation improves morale:

When you have worked hard to create a fair and competitive rewards plan,
you also want to ensure employees understand the benefits element. Our
research shows most employees tend to undervalue their compensation
package. According to last year’s Compensation Best Practices Report, just
22 percent of employees believed they were paid fairly.

According to BambooHR, you must also seek to understand the importance of

indirect compensation for your company’s bottom line. “As employees feel
more valued and motivated, not only will employee engagement, morale, and
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retention rates be higher, but your organization will also appeal to the type of
talented, dedicated, and hard-working employees that can best represent and
better the company brand.”

3) Indirect compensation helps reduce turnover:

A 2019 study found the average turnover rate for organizations with no
benefits plan is 157 percent, while organizations that offer benefits (including
standard health benefits, vision or dental insurance and life insurance, to
name a few) saw a 138 percent decrease in turnover. Indirect compensation,
when done thoughtfully and intentionally, benefits all employees, regardless
of seniority, age, title or tenure.

Employee turnover is expensive. There are a number of replacement costs to

consider, including sourcing, hiring expenses, new employee training and the time it
takes a new employee to ramp up in a job. Plus, losing an employee could cost your
organization money when it comes to unemployment compensation, COBRA
coverage costs and more. To calculate the cost of turnover, check out our formula.

The cost of turnover goes beyond just dollars. High turnover can lower the morale of
remaining employees which can lower organizational engagement. Plus, when an
employee leaves your organization, you risk losing knowledge or skills. Finally, if you
are constantly recruiting because of high turnover, you are spending your time hiring
when you should be spending your time engaging with and encouraging your high
performers.

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3. Explain with illustrations as to payment of
compensation to Victims in India.

Criminal Law has always discouraged the acts or omissions which in general can
affect right in rem and violators have always been punished with strict sanctions but
the crime rate is not falling and State is in regular quest to preserve social solidarity
and peace in society. The initial focus of criminologists were only on the aspect of
punishment but the focus started shifting when they encountered with the fact that
the person who is victim of crime is getting nothing out of the whole process of
criminal justice system or is getting a so called satisfaction by seeing the offender
punished. Therefore jurists, penologist etc in all countries started giving their full
attention to the cause of victim in form of compensation and hence the whole debate
started about ways, means and extent of compensation. This paper is an addition to
the same as it tries to look in to the position of compensation to victim of crime in
Indian Legal frame Work.

II. Meaning of Victim of Crime and Compensation to Victim of Crime:

Indian legislature has not bothered to define "Victim of Crime" under any law and
probably the Indian Judiciary is also on the same footing. The etymological meaning
of phrase suggests that it would mean or will encompass:
Anyone suffering physical, emotional or financial harm as a direct result of a Crime.
Spouses and children of the person who has suffered.
Parents, foster parents, siblings, guardians or other custodians of minor victims,
mentally or physically incapacitated victims, or victims of homicide.

In this regard reliance can be placed upon United Nations General Assembly
Declaration of Basic Principles of Justice for Victim and Abuse of Power adopted in
November 1985, which through Article 1&2 gives exhaustive definition of the phrase:

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Article1. "Victims" means persons who, individually or collectively, have suffered
harm, including physical or mental injury, emotional suffering, economic loss or
substantial impairment of their fundamental rights, through acts or omissions that
are in violation of criminal laws operative within Member States, including those laws
proscribing criminal abuse of power.

Article2. A person may be considered a victim, under this Declaration, regardless of

whether the perpetrator is identified, apprehended, prosecuted or convicted and
regardless of the familial relationship between the perpetrator and the victim. The
term "victim" also includes, where appropriate, the immediate family or dependants
of the direct victim and persons who have suffered harm in intervening to assist
victims in distress or to prevent victimization.

Therefore the combine effect of these Articles probably encompasses every thing
under the sun that ought to have been the part of definition of the phrase. 

The word compensation in literal sense men's a thing that compensates or is given
to compensate (for); a counterbalancing feature or factor; amends, recompense;
spec. money given to compensate loss or injury, or for requisitioned property. When
we talk about Compensation to the victims it means something given in recompense
i.e. equivalent rendered . It is to be noted that the whole purpose of compensation is
to make good the loss sustain by the victim or legal representative of the deceased.
Generally when we talk about compensation in the present context it only limits it
self to monetary compensation which is calculated on the basis of two head i.e.
pecuniary loss and non-pecuniary loss.

III. Evolution of Concept of Compensation to Victim of Crime:

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The evolution of the concept can be traced both historically and theoretically.
Historically the concept of victimology in crude sense was not only part of
Hammurabi's code but also existed in developed sense in ancient Greek city-states.
The concept of compensation was also not new to India and existed in more
developed sense then the present. Manu in Chapter VIII, verse 287 clearly says
that:
If limb is injured, a wound is caused or blood flows, the assailant shall be made to
pay the expense of the cure or the whole.

He further in verse 288 says that : He who damages the goods of another, be it
intentionally or unintentionally, shall give to the owner a kind of fine equal to
damage.

The quotes regarding the same can be found even in the works of Brihaspati. This is
in brief the law relating to compensation to the victim of crime that even existed in
ancient civilization of east as well as west. As far as tracing of gradual evolution of
the concept is concern the whole era till mid of 1900 can be generally divided in to
three parts. In initial year of human civilization when the human started living
together especially after stone Age, because of absence of rule of law and
authoritative political institution, right to punish or rather might to punish (in from of
eye for eye or money) was with the individual and hence in crude sense the concept
of compensation existed at that time even but line of caution that need to be bear in
mind is the fact that in primitive society criminal victim relationship was based on
brutal mentality of attack being the best defense. Then came the era in which the
social control in terms of mechanical solidarity creped in the society and the offence
against an individual lost its individualistic character and now the offence was
considered to be against the tribe or clan to which individual belongs and from this
era, due to advent of concept of collective responsibility clan or tribe started
replacing the victim's right. The third stage started with the advent of strong monarch
after medieval period. In this stage on one hand criminal law saw far reaching

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change in all its discipline but on other the hand position of victim right to
compensation remained unheard due to advent of more strong institution named
state and crystallization of a notion that King/ State is parent of his subjects and
Crime is breach of peace of King or State. So it was King/State who had the right to
punish and get monetary compensation. This position remained as it is even with
advent of democracy and the cause of victim remained unnoticed until 1950 and
after that a movement stared in U.S. and European countries and the concept again
got prominence. Theoretically radical criminologist championed the idea of cause of
victim, which was result of reaction against the then criminological thinking that was
only concern with criminals and not the victims.

VI. Indian Legal Frame Work:

The Indian position regarding compensation to victim of crime can be studied under
two heads or rather must be studied under two head in order to get complete
picture.

(i). Legislative Frame Work:

The legislative framework in Indian regarding compensation to victim of crime can
be trace through two major legislations i.e. Code of Criminal Procedure, 1973 and
Probations of Offenders Act and Constitution of India. Under the provisions of code
of criminal Procedure the power to award compensation is vested under section 357
. The plain reading of the section shows that sub-section (1) and (3) vests power on
the trail court to award compensation and sub-section (4) gives power even to
appellant or revision court to order for compensation. Sub section (1) empowers the
courts to appropriate the whole or any portion of fine recovered for the purpose
mentioned in the clauses to the sub section, under which Clause (b) is most
important and of our use . It demands that claim of compensation must be
accompanied by following conditions:

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1. Loss or injury suffered
2. Loss or injury must be caused by the offence
3. Such person can recover the compensation in a civil court

Sub section (3) empowers the court, in its discretion, to order the accuse to pay
compensation even though fine does not form part of compensation and hence
although inserted in 1973 added new positive dimension to Indian philosophy of
compensation.

Probation of Offenders Act vide its section 5 empowers the trail court to order for
compensation. The plain reading of this section clearly shows that the power in case
of this Act vests only with the trail court and non-else . The whole discussion about
legislative framework is incomplete until Section 431 and 421 of Cr.P.C. is read with
above two substantive sections. Section 421 provides for means to recover the fine
by attachment and sale of movable property of the offender and also from both
movable and immovable as arrears of land revenue . Section 431 empowers the
courts to recover any money (other than fine) payable by virtue of any order made
under as if it were fine if method for its recovery is not expressly provided . As far as
the Constitutional scheme is concern it is to be noted that it is out come of various
decision of Supreme Court of India either by reading Part third rights (in some cases
part four as well) with Art. 32, 136 and 142 of Constitution of India , which is to be
given either by the state or accuse.

Hence the whole gamete of legislative framework about compensation can be

summarized in following way:
# Compensation from State, which is out come of Judicial Imposition or some times,
even ex-gratia under Constitution of India.
# Compensation from an offender which is out come either as a part of fine or
allocation of specific sum to victim either under Cr.P.C. or Constitution of India.

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(ii). Judicial Response:
Their exist plethora of cases where the compensation has been awarded by the
Supreme Court to the victims of the crime which not only present the heart full
moments but also exposed the sorry state of affairs that has been prevalent in the
lower courts even some times High Courts.

It is better to examine cases under two heads i.e. (i) under Cr.P.C. and P.O.A. and
(ii) under Indian Constitution in order to appreciate the judicial standpoint on this
issue.

(a) Under Cr.P.C. or P.O.A:

The first case in the line, which attracted the mind of the court came way back in
1952 where the Hon'ble connected general principle of sentencing i.e. while passing
a sentence the court must bear in mind the proposnality between offence and
penalty with granting of compensation and observed that while imposing the fine
court must consider gravity of offence and the pecuniary condition of the offender.
Then came the case of Prabhu Prasad Sha v State of Bihar where the Hon'ble not
only uphold the conviction of 15 years old boy (actually at the time of commission of
crime the accuse was of 15 Yrs) but also observed that although requirements of
social justice demands the imposition of heavy fine but taking in to consideration the
condition of the accuse awarded fine of Rs 3000 to be paid by him to the children of
the deceased. In another case of Palaniappa Gounder v Sate of Tamil
Nadu Supreme Court following the same view as of earlier not only reduced the
amount of fine imposed by the High Court from Rs 20,000 to Rs 3,000 but also
observed that:
It appears to us that the High Court first considered what compensation ought to be
awarded to the heirs of the deceased and then imposed by way of fine an amount

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which was higher than the compensation because the compensation has to come
out of the amount of fine. Apart from the fact that even the compensation was not
fixed on any reliable data, the High Court, with respect, put the cart before the horse
in leaving the propriety of fine to depend upon the amount of compensation. The first
concern of the Court, after recording an order of conviction, ought to be a determine
the proper sentence to pass. The sentence must be proportionate to the nature of
the offence and the sentence, including the sentence of fine, must be unduly
excessive.

Next in the is land mark case of Sarwan Sing v State of Punjab where supreme
court not only retreated it's previous stand point but also laid down, in exhaustive
manner, that what all should be taken in to account while imposing fine or
compensation. The Hon'ble Court Observed that:
The object of the section therefore, is to provide compensation payable to the
persons who are entitled to recover damage from the person sentenced even
though fine does not form part of the sentence. Though Section 545 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 find 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
paid, then the capacity of the accused to pay 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 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

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causing an injury with the necessary mens rea to pay compensation for the person
who has suffered injury.

And also:
It is the duty of the court to take into account the nature of the crime, the injury
suffered, the justness of the claim for compensation, the capacity of the accused to
pay and other relevant circumstances in fixing the amount of fine or compensation.
After consideration of all the facts of the case, we feel that in addition to the
sentence of 5 years' rigorous imprisonment, a fine of Rs. 3500 on each of the
accused under Section 304(1), I.P.C. should be imposed.
The next important case is of Bhuperndar Singh v State of M.P. which was out come
of quarrel between college students where the Hon'ble Court although allowed the
compounding of offence but did not forget the cause of victim and granted the
compensation of Rs 3000.

The Case of Harikishan and State of Haryana v Sukhbir Singh and others is the
second most important case after Sarwan Singh where court repeated its firm
understanding once again in following words:
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.

In the case of Balraj Singh v State of U.P. stated the same point as discussed
above but in most appropriate word by saying that the power to a award

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compensation is not ancillary to the other sentence but in addition thereto.

(b) Under Indian Constitution:

The principle of payment of compensation to the victim of crime was evolved by

Hon'ble S.C. on the ground that it is duty of the welfare state to protect the
fundamental rights of the citizens not only against the actions of its agencies but is
also responsible for hardships on the victims on the grounds of humanitarianism and
obligation of social welfare, duty to protect it's subject, equitable Justice etc . It is to
be noted that compensation by the State for the action of it's official was evolved by
the Hon'ble Court against the doctrine of English law: "King can do no Wrong" and
clearly sated in the case of Nilabati Behra v State of Orissa that doctrine of
sovereign immunity is only applicable in the case of tortuous act of government
servant and not where there is violation of fundamental rights and hence in a way
stated that in criminal matters (of course if there is violation of fundamental rights)
this doctrine is not applicable.

Rudal Sah v State of Bihar is the most celebrated case where the Hon'ble S.C.
directed the state to pay compensation of Rs 35,000 to Rudal Sah who was kept in
jail for 14 years even after his acquittal on the ground of insanity and held that it is
violation of Article 21 done by the State of Bihar. The case of Bhim Singh v State of
J&K is another important case where Bhim Singh an MLA was arrested by the police
only to prevent him to attended the Legislative Assembly, the Hon'ble Court not only
entertained the writ petition of his wife but also awarded the compensation of Rs
50,000 to be paid by the state.

The case of Meja Singh v SHO Police Station Zira is another unfortunate case
where this time High Court of P&H took the cause of victim and awarded the
compensation of Rs 25,000 for illegal detention of son of the petitioner. This time it

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was High Court Bombay, which took the cause of the victim in the case of Ravikant
Patil v DG Police, State of Maharastra where the petitioner was taken handcuffed
to court in clear violation of Judgment of Hon'ble S.C., that is law, as decided in the
case of Prem Shanker Shukla v Delhi Administration. Custodial Death is another
burning issue where the courts have awarded compensation to the victims of crime
and the most important case under this heading is of Mrs. Cardino v UOI where
although the accuse was arrested on the charge of misappropriation of some plastic
ware and hospital; utensils worth Rs1500 but tortured like hard core criminal and
hence he succumbed to the torture. Here when the matter was brought before the
Hon'ble High Court of Bombay which gave the compensation of Rs 2,00,000 to be
paid by the state.

In the case of Nilabati Behra v State of Orissa where the son of petitioner was
arrested by the police and next morning his body was found laying down with
several injuries on the railway track, the Hon'ble S.C. awarded the compensation of
Rs 1,50,000 that is to be paid by the State.

On the issue of brutal use of force and misuse of authority by the police out side the
police station case of SAHELI v Commissioner of Police is land mark where the
son of Kamlesh Kumari died due to ill treatment by a S.I. of Delhi Police, the Hon'ble
S.C. directed the Delhi Adm. to pay the compensation of Rs 75,000. The next
important case is of Gudalure Cherian v UOI where Hon'ble S.C. following an
innovative approach first directed the whole matter to be investigated by the CBI
afresh and completion of investigation directed the Govt. of U.P. to first suspend the
police officials and medical officers who tried to save the accuse but also directed
the state to pay compensation of Rs 2,50,000 to the victim of rape and Rs 1,00,000
to victim of other crime.

The next in the line is the case of Bodhi Satta Gautam v Subhra

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Chakraborty where the Hon'ble S.C. invented the concept of interim compensation
and enforced the part third right against an individual by saying that:
This decision recognises the right of the victim for compensation by providing that it
shall be awarded by the Court on conviction of the offender subject to the finalisation
of Scheme by the Central Government. If the Court trying an offence of rape has
jurisdiction to award the compensation at the final stage, there is no reason to deny
to the Court the right to award interim compensation, which should also be provided

in the Scheme. On the basis of principles set out in the aforesaid decision in Delhi
Domestic Working Women's Forum, the jurisdiction to pay interim compensation
shall be treated to be part of the overall jurisdiction of the Courts trying the offences
of rape which, as pointed out above is an offence against basic human rights as also
the Fundamental Right of Personal Liberty and Life.

The court also stated that:

Having regard to the facts and circumstances of the present case in which there is a
serious allegation that Bodhisaltwa Gautam had married Subhra Chakraborty before
the God he worshipped by putting Vermilion on her forehead and accepting her as
his wife and also having impregnated her twice resulting in abortion on both the
occasions, we, on being prima facie satisfied, dispose of this matter by providing
that Bodhisattwa Gautam shall pay in Subhra Chakraborty a sum of Rs. 1,000/-
every month as interim compensation during the pendency of Criminal Case… in the
Court of Judicial Magistrate, Ist Class, Kohima, Nagaland. He shall also be liable to
pay arrears of compensation at the same rate from the date on which the complaint
was filed, till this date.

Therefore it can be observed that the Hon'ble Courts have taken little softer view
( with regard to monetary aspect) when question of the award of compensation
come under Cr.P.C. as compare to when it come under Constitution.

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VII. Assessment of the Role of Legislative Frame work and Indian Courts:

The exit no doubt that Code of Criminal Procedure provided for the compensation to
victim in the year 1898, when even the concept has not developed properly but now
it submitted that the whole scheme under Cr.P.C. or P.O.A. needs renovation. The
most important attack on the present legislative frame work lies on the desertion
given to the courts i.e. it depends upon them to grant compensation and absence of
recording any reason when they abstain them self from grating compensation.
Another criticism of the present legislative framework lies in the absence of right of
victim to claim compensation. Critics also argue for the absence of any institutional
scheme under the present legislative framework that has now become the important
part of victim- Crime relationalship in countries of southern hemisphere such as
USA, UK, New Zealand, France etc . The laxity on the part of Indian legislature is so
much so that India has not made any legislation to give compensation to victim of
crime when accused is acquitted despite of its obligation under various International
Covenants .

In this regard even Hon'ble S.C. in the case of Delhi Domestic Working Forum v
UOI has shown its concern in flowing words:
It is necessary, having regard to the Directive Principles contained under Article
38(1) of the Constitution of India to set up Criminal Injuries Compensation
BoardCompensation for victims shall be awarded by the court on conviction of the
offender and by the Criminal Injuries Compensation Board whether or not a
conviction has taken place. The Board will take into account pain, suffering and
shock as well as loss of earnings due to pregnancy and the expenses of child birth if
this occurred as a result.

So this in brief set out the major defaults in the present legislative framework due to

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which the whole concept of compensation has become akin to flop show in India.
However it is to be noted that part of responsibility of being the concept flop show
lies on Indian judiciary as well, especial the lower courts.

In this regard the observation of Hon'ble S.C. in the case of State of Gujarat v
Hon'ble High Court of Gujarat is relevant where following was stated:
Section 357 of the Criminal Procedure Code, 1973 provides some reliefs to the
victims as the court is empowered to direct payment of compensation to any person
for any

loss or injury caused by the offence. But in practice the said provision has not
proved to be of much effectiveness. Many persons who are sentenced to long term
imprisonment do not pay the compensation and instead they choose to continue in
jail in default thereof. It is only when fine alone is the sentence that the convicts
invariably choose to remit the fine. But those are cases in which the harm inflicted
on the victims would have been far less serious. Thus the restorative and reparative
theories are not translated into real benefits to the victims.

Case of Harikishan Singh is also of importance where the Hon'ble S.C. observed
that:
It is an important provision but courts a 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

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constructive the victim 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.
Moreover the comment High Court in case of In Re Drug Inspector is very important
where it was stated that efficacy of a law and its social utility depends largely on the
manner4 and the extent of its application by the courts . It was further stated that the
good law badly administered may fail its social purpose and if overlooked in practice
fail in the purpose and utility . The Law Commission of India in its 41st report clearly
sated that our courts are not liberal in utilizing these provisions and went to the
extent

of saying that it is regrettable that our courts do not exercise their statutory powers
under this section as freely and liberally as they could desire.

However in this regard it is to be noted that the attempt of Hon'ble S.C. and some of
the High Courts as discussed above clearly shows that they are championing the
cause of victim even in the given set up but still looking to the problem as a whole,
inherent weakness on the legislative framework as well as laxity on the part of court
has made the proper functioning of whole concept a distant dream in strict sense.

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References

 Types of Compensation (businessmanagementideas.com)

 What Are the Different Types of Compensation? | PayScale
 Direct, Indirect & Non-Financial Compensation Strategies - Video & Lesson
Transcript | Study.com
 Direct Compensation | Allowances, Reimbursements, & More
(patriotsoftware.com)
 Indirect Compensation - Non Monetary Benefits (naukrihub.com)
 rudal shah v state of bihar (indiankanoon.org)
 Microsoft Word - DubeVol13Issue2IJCJS.doc (sascv.org)
 Compensation to the Victim of Crime: Assessing Legislative Frame Work and
Role of Indian Courts (legalserviceindia.com)

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