Compound Interest and Simple Interest Difference

Given $CI_2 - SI_2 = 64$ and $CI_2 = 704$. So $SI_2 = 704 - 64 = 640$. Simple interest for 1 year = $\frac{640}{2} = 320$. The difference of Rs. 64 is the interest on 1 year's simple interest. So $\frac{R}{100} \times 320 = 64 \implies R = 20\%$. Principal $P = \frac{SI_1 \times 100}{R} = \frac{320 \times 100}{20} = 1600$.