The Compensatory Afforestation Fund Act, 2016.
Administered Ministry: Ministry of Environment, Forest and Climate Change
Act details
| Short title | The Compensatory Afforestation Fund Act, 2016. |
|---|---|
| Long title | An Act to provide for the establishment of funds under the public accounts of India and the public accounts of each State and crediting thereto the monies received from the user agencies towards compensatory afforestation, additional compensatory afforestation, penal compensatory afforestation, net present value and all other amounts recovered from such agencies under the Forest (Conservation) Act, 1980, constitution of an authority at national level and at each of the State and Union territory Administration for administration of the funds and to utilise the monies so collected for undertaking artificial regeneration (plantations), assisted natural regeneration, protection of forests, forest related infrastructure development, Green India Programme, wildlife protection and other related activities and for matters connected therewith or incidental thereto. |
| Act number | 38 of 2016 |
| Act year | 2016 |
| Enactment date | 3 Aug 2016 |
| Ministry | Ministry of Environment, Forest and Climate Change |
| Jurisdiction | Central (Parliament of India) |
| Sections | 33 |
| Status | Not repealed |
| Last checked on India Code | 28 Oct 2026 |
| Source | India Code, Government of India |
Summary
Summary of the Compensatory Afforestation Fund Act, 2016
Title & Extent
• Act Name: The Compensatory Afforestation Fund Act, 2016
• Act No.: 38 of 2016
• Extent: Whole of India, including Union Territory Administrations
Purpose
• Establish funds for compensatory afforestation and related activities across all territories.
• Utilize monies from user agencies for forest land diversion under the Forest (Conservation) Act, 1980, uniformly applied.
Key Provisions
1. Funds Establishment & Administration
• National Compensatory Afforestation Fund (National Fund): Centralized, overseeing all territories.
• State/Union Territory Compensatory Afforestation Fund (State/UT Fund): Established in each, with clear administration guidelines for Union Territories.
2. Management Authorities & Coordination
• National Authority: Oversees National Fund, coordinates with State and Union Territory Authorities.
• State/Union Territory Authority: Manages respective funds, with specified roles for Union Territory Administrations.
3. Fund Utilisation & Territory Considerations
• National Fund: 90% distributed to State/UT Funds; 10% for overarching management, ecological projects, and inter-territory initiatives.
• State/UT Fund: Prioritizes local compensatory afforestation, forest and wildlife protection, tailored infrastructure, and community projects, with adjustments for Union Territory specific needs.
Legislative history
Legislative History:
The Compensatory Afforestation Fund Act, 2016
● Act Title - The Compensatory Afforestation Fund Act, 2016
● Act Number / Year - 38 of 2016
● Act ID (India Code) - 201638
● Assent Date - August 3, 2016
● Enforcement Date - September 30, 2017
● Nodal Ministry - Ministry of Environment, Forest and Climate Change
Precedent & Historical Rationale
● Ad-Hoc CAMPA and Accumulation of Unspent Funds under Supreme Court Orders - Under the Forest (Conservation) Act, 1980, when forest land is diverted for non-forest purposes, the user agency must pay for compensatory afforestation, Net Present Value (NPV), and catchment area treatment. In 2002, the Supreme Court of India in T.N. Godavarman Thirumulpad v. Union of India directed the creation of a specialized body, leading to the creation of the ad-hoc Compensatory Afforestation Fund Management and Planning Authority (CAMPA) in 2006. Over the years, massive compensatory levies (exceeding ₹40,000 crore) accumulated in ad-hoc bank accounts outside the Consolidated Fund of India, lacking a permanent institutional mechanism for statutory allocation and transparent expenditure by States.
● Permanent Statutory Architecture for Fund Management and Afforestation - Formulated to provide for the establishment of funds under the public accounts of India and the public accounts of each State, and the crediting of monies received from user agencies for compensatory afforestation. The Act established the National Compensatory Afforestation Fund Management and Planning Authority (National CAMPA) and State CAMPAs, mandating a permanent statutory formula where 90% of collected funds are transferred directly to the respective State Funds and 10% retained in the National Fund to expedite reforestation, assisted natural regeneration, wildlife habitat protection, and forest infrastructure management.
Parliamentary Trajectory & Enactment
● Formulation & Re-introduction - Drafted by the Ministry of Environment, Forest and Climate Change following an earlier lapsed measure from 2008 (The Compensatory Afforestation Fund Bill, 2008); re-introduced as The Compensatory Afforestation Fund Bill, 2015 (Bill No. 147 of 2015) by Minister of State (Independent Charge) Prakash Javadekar in the Lok Sabha on May 8, 2015.
● Parliamentary Passage - Debated and passed by the Lok Sabha on May 3, 2016, and considered and passed by the Rajya Sabha on July 28, 2016, during the Monsoon Session.
● President's Assent - Received the assent of the President of India (Pranab Mukherjee) on August 3, 2016, and was published in the Gazette of India on the same day.
● Enforcement - Enforced on September 30, 2017.
Sources - Parliamentary Debates (Lok Sabha & Rajya Sabha), The Gazette of India, India Code, and Ministry of Environment, Forest and Climate Change..