SQL server doesnt support encryption for storing password in user tables.

Pl. have a look at following articles for reference

http://www.sqlservercentral.com/columnists/rsharma/comencrytptpw.asp

http://www.sqlservercentral.com/columnists/lsmith/usingjavatoencryptpasswords.asp

http://www.sqlservercentral.com/columnists/bknight/encryptfunction.asp