Holding

An order directing payment of compensation under Section 357(4) of the Cr.P.C. is invalid unless the accused is afforded a hearing, as the principles of natural justice apply in the absence of express statutory exclusion.

Summary

Mangilal was convicted of murder and other offences and sentenced to life imprisonment. The Madhya Pradesh High Court, exercising its revisional powers, ordered him and the other accused to pay Rs.30,000 as compensation under Section 357(3) and (4) of the Cr.P.C. without hearing them on the quantum of compensation. The appellant challenged this, arguing that the power to award compensation is not ancillary to a fine and that natural‑justice principles require a hearing before imposing such liability. The Supreme Court held that although Section 357 empowers an appellate or revisional court to award compensation, the award is not merely ancillary to a fine and, where substantial rights are affected, the principles of natural justice must be observed. Consequently, the Court set aside the High Court’s compensation order, remitted the matter for a hearing, and allowed the appeal in part.

Issues considered

Whether a court may direct payment of compensation under Section 357(3) and (4) of the Cr.P.C. without granting the accused an opportunity of hearing.
Whether the power to award compensation under Section 357 is ancillary to a fine or an independent jurisdiction.
Whether the principles of natural justice apply when the statute is silent on procedural safeguards.

Legislation cited

Code of Criminal Procedure, 1973s. 357(1), s. 357(3), s. 357(4), s. 357(5)

Subjects

Section 357CompensationNatural JusticeHearingCriminal ProcedureRevisional PowerMurderVictim Compensation

Judgment

MANGILAL A
V.

STATE OF MADHYA PRADESH

JANUARY 5, 2004

[DORAISWAMY RAJU AND ARIJIT PASA YAT, JJ.] B

"(
Code of Criminal Procedure, 1973; Seclion 357:

Grant of compensation by the High Courl to heirs of deceased/injured
withoul affording an opporlzmity of hearing to lhe accused-Correctness of- c
Held: The power of the Courl to award compensation nol ancillary lo other
sentences but in addition thereto-When substantial rights of parties are
considerably affected, principles of natural justice have lo be followed unless
found excluded by express words ofstatutes or necessary intendment-Statutory
silence implies compliance with the principles of natural justice-High Court D
directed to grant an opportunity to hear the accused before directing any
payment of compensation.
\
Words and Phrases:

'May'-Meaning of in the context of Section 357 of the Criminal E
Procedure Code-Interpretation of Statutes.

,,. The question involved in this appeal was limited to the scope and
, ambit of Section 357 of the Code of Criminal procedure and grant of
compensation thereunder.
F
It was contended for the accused-appellant that the High Court did
not take into consideration the objects underlying grant of compensation
~ under Section 357 Cr.P.C.; that though the trial Court did not impose any
fine but the High Court directed payment of compensation without even
affording an opportunity to hear the accused while fixing' the quantum of
compensation; and that an additional liability was fastened on the accused. G

On behalf of the State, it was contended that the compensation
awarded was in addition to the fine; and that since Section 357 Cr.P.C.
"I
did not postulate grant of an opportunity of hearing, it is not necessary to
afford the accused an opportunity before ordering him to pay
I H
\

2 SUPREME COURT REPORTS [2004) I S.C.R.

A compensation to the victim.
Partly allowing the appeal, the Court

HELD: I. I. The basic difference between sub-section (I) and (3) of
Section 357 Cr.P.C. is that in the former case the imposition of fine is the
B basic and essential requirement, while in the latter even in the absence
thereof, the Court is empowered to direct payment of compensation. Such
power is available to be exercised by an Appellate Court or by the High
Court or Court of Sessions when exercising revisional powers. The power
of the Court to award compensation to victims under Section 357 is not
C ancillary to other sentences but is in addition thereto. [7-C-E]

Hari Singh v. Sukhbir Singh and Ors., [1998[ 4 SCC 551 and Sarwan
Singh and Ors. etc. v. The State of Punjab, AIR (1978) SC 1525, referred
to.

1.2. Where the statute is silent about the observance of the principles
D of natural justice, such statutory silence is taken to imply compliance with
the principles of natural justice where substantial rights of parties are
considerably affected. The application of natural justice becomes I
presumptive, unless found excluded by express words of statute or
necessary intendment. Its aim is to secure justice or to prevent miscarriage
E of justice. Principles of natural justice do not supplant the law, but
supplement it. These rules operate only in areas not covered by any law
validly made. They are means to an end and not an end in themselves.
Hence, the irresistible conclusion is that opportunity has to be granted
before directing payment of compensation under Section 357 (4) of the
-
Code. [8-G, H; 9-A-C]
F
Sll'adesi Cotton Mills etc. etc. v. Union of India etc. etc., AIR (1961)
SC 818, relied on. -<

1.3. The use of the l'xpression "may" throws light on the legislative
intent in the context it is used. It has been used in the permissible sense
G and docs not make it obligatory. In the aforesaid background, the
inevitable conclusion is that if the Appellate Court intends to award
compensation an opportunity of hearing has to be granted so that the
relevant aspects like the need to award compensation, capacity of the
accused to pay and several other relevant factors can be taken note of.
H Hence, the part of the High Court judgment which relates to direction
MANGILAL v.STA TE OF M. P. [ARIJIT PASA YAT. J.] 3
for payment of compensation by the accused-appellant is set aside. The A
matter is remitted back to the High Court, which shall grant an
opportunity to the accused-appellant, and the adjudication shall be limited
to that question particularly relating to the liability of the appellant only.
It is made clear that no opinion is expressed on the merits of the issue to
be decided under Section 357 (4) Cr.P.C. 19-C-FI
B
CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 667
of 2003.

From the Judgment and Order dated 19.7.2001 of the Madhya Pradesh
High Court in Cr!. A. No. 38 of 1987.
c
Dr. T.N. Singh, Lakhan Singh Chauhan and Anil Shrivastav for the
Appellant.

Siddhartha Dave and Ms. Vibha Datta Makhija for the Respondent.

The Judgment of the Court was delivered by D
ARIJIT PASAYAT, J. An interesting question relating to the scope
and ambit of Section 357 of the Code of Criminal Procedure, 1973 (for short
'the Code') is raised in this appeal which by order dated 15.10.2003 was
limited to the question of grant of compensation as done by the High Court.
In view of the aforesaid, and the question of law involved, it is not necessary E
to go into the factual aspects in detai I.

The appellant (hereinafter referred to as 'the accused) faced trial along
with seven others for alleged commission of offences punishable under Section
452, 148, 323 read with Section 149, 302 read with Section 149 of the Indian F
Penal Code, 1860 (for short 'the !PC') for allegedly causing death of one
Rajinder Kumar (hereinafter referred to as 'the deceased'). All the accused
persons including the appellant were found guilty for offences relatable to
Section 448. They were also found guilty of offence relatable to Section 323
read with Section 149 IPC for having caused injuries to Amar Singh. the
informant (PW-8). They were acquitted of the charges relatable to Section G
148 IPC and were convicted in relation to Section 147 !PC. Appellant was
acquitted of charges relatable to Section 323 read with Section 149 but was
convicted under Section 302 !PC. The rest of the accused persons were not
found guilty in relation to Section 302 read with Section 149 IPC. All the
accused persons except accused Babu Lal were acquitted of the charges H
\

4 SUPREME COURT REPORTS [2004) I S.C.R.

A under Section 323 read with Section 149 !PC. Accused-appellant was
sentenced to undergo life imprisonment for the offence punishable under
Section 302 IPC and for the rest of offence he was sentenced to RI for six
months each. Other accused persons were sentenced to undergo RI for six
months each for two offences for which they were found guilty. Accused
B Babu Lal in addition was sentenced to undergo for all the three offences for
six months RI. Four appeals were filed by the accused persons including the
appellant before the High Court. By the impugned judgment, a Division
Bench of Madhya Pradesh High Court maintained convictions of the appellant. Y

It was noticed that the appellants before the High Court (except the present
accused-appellant) have been in custody for about two months. It was noted
C that the trial Court had not awarded any compensation to the heirs of the
deceased and to the injured (PW-8). As the High Court did not feel it
appropriate to send the rest of the accused persons to jail, direction was given
that each of them shall pay compensation @ Rs. 30,000 in terms of Sections
357 (3) and (4) of the Code. The accused-appellant was also directed to pay
similar compensation. Fixing a proportion by apportionment it was directed
D that out of the compensation, 2/3rd was to be paid to the heirs of the deceased
while rest I/3rd was to be paid to the injured (PW-8). Sentence .of all the
appellants in respect of Sections 14 7 and 148, and in case of accused-Babula I .;
additionally for Section 323 was reduced to the period of imprisonment already
undergone. Only accused-appellant Mangilal has preferred this appeal which
E as noted at tl1e outset was restricted to the question of grant of compensation.

Dr. T.N. Singh, learned senior counsel appearing for the appellant
submitted that the High Court has not kept in view the object underlying the
grant of compensation under Section 357 of th~ Code. This is a case where
no fine was imposed by the trial Court, but the High Court directed payment
F of compensation. While fixing the quantum the accused persons were not
heard thereby violating principles of natura·I justice. An additional liability
was fastened on the accused-appellant, and therefore, the principles of natural
justice mandated grant of an opportunity.

Per contra, learned counsel for the State submitted that the compensation
G is in addition to the fine and when for allocating fine no hearing is necessary,
except while hearing on the question of sentence, there is no requirement for
hearing the accused before awarding compensation. In any event, Section
357 nowhere postulates grant of an opportunity to be heard.

For appreciating rival submissions, it is appropriate to quote Section
H
MANGILAL v.STA TE OF M. P. [ARIJIT PA SAY AT, J.] 5
: 'J- 357 of the Code along with the amendments in the State of Madhya Pradesh, A
which reads as follows:

"Section 357: Order to pay compensation (I) 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; - B
(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
(c} when any person is convicted to any offence for having caused
the death of another person or of having abetted the commission
of such an offence, in paying compensation to the persons who
are, under the Fatal Accidents Act (13of1855), entitled to recover
damages from the person sentenced for the loss resulting to them· D
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 voluntarily assisted in disposing of, stolen property E
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 F
payment shall be made before the period allowed for presenting the
appeal has elapsed, or, if an appeal is 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 G
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.

(4) An order under this section may also be made by an Appellate H
6 SUPREME COURT REPORTS [2004] I S.C.R.

A 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."
B
The Madhya Pradesh State Amendment reads as follows:

"(a) In sub-section (!), for-

(I) When a Court imposes a sentence of fine or a sentence
(including a sentence of death) of which fine forms a part, the Cou11
c may, when passing judgment, order the whole or any part of the fine
recovered to be applied; substitute-

(I) When a Court imposes a sentence of fine or a sentence
(including a sentence of death) of which fine fo1ms a part, the Court
D may, and where a person against whom an offence is committed
belongs to Scheduled Castes or Scheduled Tribes as defined in clauses
(24) and (25) of Article 366 of the Constitution of India, 1950 (in
short the 'Constitution') except when both the accused person and the
I
person against whom an offence is committed belong either to such
castes or tribes, the Court shall, when passing judgment, order the
E whole or any part of the fine recovered to be applied; and

(b) substitute sub-section (3) as under:

(3) When a Court imposes a sentence, of which fine does not
form a part, the Court may, and where a person against whom an
F offence is committed belongs to Scheduled Castes or Scheduled Tribes
as defined in clauses (24) and (25) of Article 366 of the Constitution,
the Court shall, 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.
G
Provided that the Court may not order the accused person to pay
by way of compensation any amount, if both the accused person and
the person against whom an offence is committed belong either to the
Scheduled Caste or the Scheduled Tribe. (M.P. Act,20of1978 w.e.f.
5.10.1978)"
H
.J

MANG ILAL v.STA TE OF M. P. [ARIJIT PASA YAT, J.] 7
Sub-section (1) of Section 357 deals with a situation when a Court A
imposes a fine or a sentence (including sentence of death) of which fine also
forms a part. It confers a discretion on the Court to order as to how the whole
or any part of fine recovered is to be applied. For bringing in application of
sub-section (I) of Section 357 it is a statutory requirement that fine is imposed
and thereupon make further orders as to the disbursement of the said fine in
the manner envisaged therein. If no fine is imposed, sub-section (I) of Section B
357 has no application. In the case at hand no fine was imposed by the trial
Court or the High Court. Sub-section (3) on the other hand deals with the
situation where fine does not form part of the sentence imposed by a Court.
In such a case, the Court when passing a judgment can order the accused
persons to pay by way of compensation such amount as may be specified in C
the order to the person who has suffered a loss or injury by reason of the act
of which the accused person has been so convicted and sentenced. The basic
difference between sub-section (I) and (3) is that in the former case, the
imposition of fine is the basic and essential requirement, while in the latter
even in the absence thereof empowers the Court to direct payment of
compensation. Such power is available to be exercised by an Appellate Court D
or by the High Court or Court of Sessions when exercising revisional powers.
Sub-section (5) deals with a situation when the Court fixes the compensation
in any subsequent civil suit relating to the same matter. While awarding
compensation the Court is required to take into account any sum paid or
recovered as compensation under Section 357 of the Code. E
The power of the Court to award compensation to victims under Section
357 is not ancillary to other sentences but is in addition thereto. In Hari
Singh v. Sukhbir Singh and Ors., [1988] 4 SCC 551 it was observed that the
power under Section 357 is a measure of responding appropriately to crime
as well as reconciling the victim with the offender. It is, to some extent, a re- F
compensatory measure to rehabilitate to an extent the beleaguered victims of
the crime, a modern constructive approach to crimes, a step forward in our
criminal justice system. In Sarwan Singh and Ors. etc. v. The State of Punjab,
AIR (1978) SC 1525 it was held that in awarding compensation, the Court
has to decide whether the case is fit one in which compensation has to be G
awarded. If it is found that the compensation should be ordered to be paid,
then while arriving at the quantum to be paid, Courts are obliged to keep into
account the capacity of the accused to pay the compensation besides taking
into consideration also the nature of the crime in each case, the justness of
the claim for compensation and the need for it in the context of the victim
or members of the family of the victim and other relevant circumstances, if H
\,

8 SUPREME COURT REPORTS [2004) I S.C.R.

A any, in so fixing or apportioning the amount of compensation. As noted
above, the mode of application of the fine is indicated in sub-section (I) of
Section 357. Sub-section (3) contains an independent and distinct power to
award compensation.

That brings us to the most crucial question, that is, whether the Court
B was required to hear accused before fixing the quantum of compensation. It
is urged by the learned counsel for the State that unlike a sentence of fine
before imposition of which a Court is required to hear the accused while
considering the question of quantum of sentence, it is but natural that the trial
,,.
Court after hearing on the question of sentence does not impose a fine, but
C in terms of sub-section (3) of Section 357 proceed to award compensation,
at that juncture or even during the course of hearing as to the quantum of
sentence by sufficient indication made by the Court concerned, the accused
gets opportunity to present his version as to the relevant criteria or norms to
be applied in the context of the case before the Court on the quantum of
compensation. Tht: position cannot be said to be, in any way different while
D the Appellate or Revisional Court also does it in terms of sub-section (4), as
long as it requires to be· done in the light of the criteria indicated as above,
unless it is by any agreement or consent of the parties such compensation has
been fixed.

Even if a statute is silent and there are no positive words in the Act or
E Rules made thereunder there could be nothing wrong in spelling out the need
to hear the parties whose rights and interest are likely to be affected, by the
orders that may be passed, and making it a requirement to follow a fair
procedure before taking a decision, unless the statute provides otherwise. The
principles of natural justice must be read into unoccupied interstices of the
F statute, unless there is clear mandate to the contrary. No form or procedure
should ever be permitted to exclude the presentation of a litigant's defence
or stand. Even in the absence of a provision in procedural laws, power inheres
in every Tribunal/Court of a judicial or quasi-judicial character, to adopt
modalities necessary to achieve requirements of natural justice and fair play
to ensure better and proper discharge of their duties. Procedure is mainly
G grounded on principles of natural justice irrespective of the extent of its
application by express provision in that regard in given situation. It has
always been a cherished principle. Where the statute is silent about the
observance of the principles of natural justice, such statutory silence is taken
to imply compliance with the principles of natural justice where substantial
H rights of parties are considerably affected. The application of natural justice
j

l'vlANGILAL v. STATE OF M. P. [ARI.Ill PASA YAT. J.j 9

becomes presumptive, unless found excluded by express words of statute or A
necessary intendment. (See Swadesi Cotton Mills etc. etc. v. Union of India
etc. etc., AIR (1961) SC 818.) Its aim is to secure justice or to prevent
miscarriage of justice. Principles of natural justice do not supplant the law,
but supplement it. These rules operate only in areas not covered by any law
validly made. They are means to an end and not an end in themselves. The
principles of natural justice have many facets. Two of them are: notice of the B
case to be met, and opportunity to explain.

In the aforesaid premises, the irresistible conclusion is that opportunity
has to be granted before directing payment of compensation under Section
357 (4) of ihe Code. C
The use of the expression "may" throws light on the legislative intent
in the context it is used. It has been used in the permissible sense and does
not make it obligatory. Jn the aforesaid background, the inevitable conclusion
is that if the Appellate Court intends to award compensation l!n opportunity
of hearing has to be granted so that the relevant aspects like the need to D
award compensation, capacity of the accused to pay and several other relevant
factors can be taken note of.
\
Accordingly, we set aside that part of the High Court judgment which
relates to direction for payment of compensation by the accused-appellant
and remit the matter back to the High Cou1t, which shall grant an opportunity E
to the accused-appellant, and the adjudication shall be limited to that question
particularly relating to the liability of the appellant only since others are said
to have already paid the respective amount. It is made clear that we have not
expressed any opinion on the merits of the issue to be decided under Section
357 (4) of the Code. The appeal is allowed to the extent indicated.
F
S.K.S. Appeals partly allowed.