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11. Approach-II is demonstrated by following formula:-

"Till such time as data and information for a comprehensive NPV is worked out in a site specific manner to account for all (or at least the major) ecological damages, a simplified NPV, proxied on the market value of the illegally extracted amount may be computed. In this case the NPV approach would imply that the total benefits from the activity of sand mining (as represented by the market value of the extracted amount) be deducted from the total ecological costs imposed by the activity. In the absence of data on benefits and costs separately, we recommend a modification of the formula as shown below:

12. Final recommendation is as follows:

"Thus, it is recommended that the annual net present value (NPV) of the amount arrived at after taking the difference between the costs and the benefits through the use of the above approach, maybe calculated for a period of 5 years at a discount rate of 5% for mining which is in a severe ecological damage risk zone. The rationale for levying this NPV is based on expert opinion that reversal and/or restoration of the ecological damages is usually not possible within a short period of time and rarely is it feasible to achieve 100% restoration, even if the sand deposition in the river basin is restore through flooding in subsequent years. The negative externalities of the mining activity are therefore to be accounted for in this manner. Ideally, the worth of all such damages, including costs of those which can be restored should be charged. However, till data on site- specific assessments becomes available, this approach may be adopted in the interim. In situations where the risk categorization charged. However, till data on site-specific assessments becomes available, this approach may be adopted in the interim. In situations where the risk categorization is unavailable or pending calculation, the following Discount Rates may be considered:

Present Value of Foregone Ecological Values (@ 5% discount rate and over 5 years) Net Present Value (after netting out market value of illegally minedmaterial) -i.e., Total Compensation to be levied = NPV=PV-D = Rs. 66,58,953/-

Compensation Charge in above case:

Approach 1                           Approach 2
(no explicit accounting of NPV)      (explicit accounting of NPV)

D*(1+RF+DF)                          @ 5% discount rate and over 5 years

Rs. 46,00,000/-                      Rs. 66,58,953/-


     14. The   Tribunal   directed       undertaking    of    scenario

* Discount rate is taken as 7% as risk is considered moderate Compensation Charges in present case as per the two approaches are as follows:-

              Approach 1                                           Approach 2
              (no explicit accounting of NPV)                      (explicit accounting of NPV)

              Rs. 19,12,50,000/-                                   Rs 8,03,32,552/-

38. Since in the Original Application No. 360/2015, the amount of compensation charge has been calculated from Approach- I & Approach -II and the higher one was taken to be the compensation charge, which was made chargeable in the case in hand also, following the same, we are of the view that the environmental compensation charge of the higher amount, which has been arrived at by adopting Approach-II, should be realized from the Project Proponent.