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Penology is a branch of criminology which involves the conferring of punishment on offenders and persons who defy statutory obligations. The penal system is a creature of penology and includes a variety of tools such as imprisonment, fines, forfeitures and capital punishment and their usage and intensity of usage depend upon the jurisdiction where they are being deployed. Principally, there are two methods of levying fines. One way is through the prescription of the fine amount under the law by using the local currency of the country and considering the economic conditions and system of punishment followed in the jurisdiction. The other way is to impose a number of penalty units is fine for offences. The Indian penal system currently follows the former method whereas Australia is a stellar example of the latter method of imposing fines. This article is aimed at assessing whether replacing the current system of levying fines under statutes with penalty units is capable of improving the Indian penal system?
Analysis and Interpretation
A penalty unit is a tool of imposing fines and its value is determined by a standard law created either for the entire nation or for provincial territories within the nation which is amended from time to time to address the needs of penal reformation. In fact, this method of imposing fines can alleviate various problems faced in the Indian penal system. This is mainly because fines in India are prescribed in its official currency, i.e., the Indian National Rupee, and the changing economic conditions and social needs might lead to redundancy in the amount of fine imposed as punishment. Therefore, it is hypothesised that adopting the penalty units model in the Indian penal system can lead to a more effective penal structure. This is possible due to the fact that the value of a penalty unit is determined by a common piece of law and simply amending such law would automatically result in the increase or decrease in the value of fine in all the laws covered under such common penalty unit value prescription law. Currently, the Indian legal system faces the dilemma of outdated fines in its laws. It is indeed even true that some of these laws have not been amended since the pre-colonial era and are incapable of penalising offenders in a manner which can effectively suit the needs of present times. The Indian Penal Code 1860 is one such example where the minimum fine imposed is INR 100 and the maximum can go up to INR 1,000. Section 63 of the Indian Penal Code 1860 also states that where no fine amount has been prescribed, the amount should not be excessive and judicial interpretation over the years have led to fines being proportionate to the nature and gravity of the offence. There are various other national-level laws which have a fine range between INR 10 and INR 2,000 despite the fact that significant economic advancements have rendered such amounts to be triflous for offenders. Some of these laws include the Cattle Trespass Act 1871,  the Metal Tokens Act 1889, the Registration of Births and Deaths Act 1969, the Press and Registration of Books Act 1867, the Architects Act 1972, the Railways Act 1989, the Immoral Traffic (Prevention) Act 1956 and the Prevention of Cruelty to Animals Act 1960. Introduction of penalty units in the Indian penal system can eliminate the chances of outdated fines. However, in order for this to happen mass amendments in almost all legislations will have to be undertaken. Although this might be seen as a downside, it is an upside in the true spirit, mainly because the need for penal amendments in enactments will reduce as amendments will only be required in the respective Central or State penalty units legislation. In the initial stages to ensure ease of the process, the custom of subject-wise amendments can be used such as amendments of all criminal legislation under the Criminal Laws (Amendment) Act or amendments of all tax legislation under the Tax Laws (Amendment) Act. These amendments would necessarily have to change all the currency figures of statutory fines to penalty units. Australia has been one of the most successful jurisdictions in the world in introducing penalty units in their legal penal system on the commonwealth as well as provincial level. The system in Australia has developed in such a manner, so as to accommodate different penalty unit values for South Australia, New South Wales, Victoria, Queensland, Western Australia, Tasmania, Northern Territory and Australian Capital Territory for provincial offences. Penalty units are also available at the commonwealth level as a whole for commonwealth offences. From 01st July 2020 onwards, the value of a penalty unit in Victoria has been assigned at Australian Dollar (AUD) 165.22 (INR 8,812). Similarly, the value of one penalty unit in, Northern Australia is AUD 158 (INR 8,425), Tasmania is AUD 172 (INR 9,170), New South Wales is AUD 110 (INR 5,865), Queensland is AUD 133.45 (INR 7,117),  Western Australia is AUD 163 (INR 8,695), Australian Capital Territory is AUD 160 (INR 8,536) for offences committed by individuals and AUD 810 (INR 43,245) for offences committed by corporations and AUD 222 (INR 11,854) for commonwealth offences in the Commonwealth. Few other jurisdictions which have successfully implemented penalty units in their penal systems include Zambia and Samoa Islands. The value of one penalty unit in Samoa Islands is 100 Samoan Tala (INR 2,848) and the value of one penalty unit in Zambia is Ngwee 20 (INR 75). Needless to say, if the penalty unit system is implemented in India it can not be adopted with different values being associated with every State. This is mainly because Australia has evolved into being an extremely strong federal set up where its provinces have capabilities of functioning as independent countries as well, whereas India’s strong reliance on a quasi-federal mechanism will prevent it from effectively being able to replicate this mechanism. Evidently, the various issues faced and discrepancies in the imposition of fines in different States after the enactment of the Motor Vehicles (Amendment) Act 2019 has showcased incapability of Indian States in imposing adequate fines to serve a statutory purpose. Thus, if India adopts the penalty units system then its value will have to be determined by the Central Government on an annual basis. India’s regular and annual amendment capabilities have already been showcased by the Finance Act and hence, it can be made possible in this sphere as well. It is undeniable that economic inequalities are extremely wide in India and thus, it is pertinent that the value of penalty units are not excessive in nature. At the same time, the value assigned to such penalty units cannot be extremely less too, since this will lead to the purpose of reformation being redundant. Looking at the present economic conditions and social issues faced in India, the ideal value for one penalty unit could be INR 5,000 and the respective legislations would have to adopt the concept of penalty units based upon this value. It is also noteworthy that keeping INR 5,000 as the value of one penalty unit will lead it to be the lowest fine amount which can be levied for punishing offenders in India.
Therefore, in view of all the discussions advanced in the paragraphs above, it seems to be clear that replacing the current fine imposition system with the penalty units system in India can lead to the resolution of various problems faced in India’s penal system. Australia, Samoa Islands and Zambia’s success of utilising the penalty units system has showcased that it is possible to accommodate it in India as well and that it is capable of reforming the Indian penal system for the greater good. Thus, in light of the aforementioned, it is recommended that the current system of imposing fines with currency based monetary value can be replaced with the introduction of penalty units. Such inclusion of penalty units can be done through enacting a law at Central level which will prescribe monetary value to these penalty units. In order to ensure ease of process in amending laws in India to meet the penalty unit requirements, it is recommended that subject-wise law amendments should take place. It is also recommended that the value for one penalty unit should be INR 5,000 to balance the need for adequate fines and as well as keep in mind the wide economic gaps amongst the segments of the Indian population and also that the value of these penalty units should be annually amended to suit the requirements of the country.




Mr Manohar Samal is a Master of Laws (LLM) Candidate at the National Institute of Securities Markets, Mumbai.

In Content  Picture Credit: ClearIAS




Kindly note that the views and opinions expressed are of the author and not of the Indian Journal of Law and Public Policy.  

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