5.1     Working of Mechanical Workshops

1.     Introduction

The Indian Railways held a fleet of 7806 locomotives, 3444 coaches, 30322 conventional coaches and 337562 wagons as on 31 March 1993 with an investment of Rs.4829.89 crores. The safety and reliability of Railway transportation system depend on the proper maintenance of rolling stock. For this purpose the Railways have 46 workshops equipped with plant and machinery, manpower and infrastructure. The expenditure on repair and maintenance of locomotives, carriages and wagons rose from Rs.1621.33 crores in 1989-90 to Rs.2024.12 crore in 1992-93. The total expenditure on repair and maintenance of rolling stock amounted to Rs.7245.63 crores during the four years 1989-90 to 1992-93 which represented 21 per cent of total ordinary working expenses.

2.     Organisational set up

The workshops are under the control of the Mechanical Department of the Railways headed by the Chief Mechanical Engineer. The direct control of the affairs of the workshops is exercised by the Chief Workshop Engineer who is the administrative head of the department. The performance of the workshops is monitored by the Member (Mechanical) in the Railway Board.

3.     Scope of Audit

The review covers the working of selected workshops for the period from 1989-90 to 1992-93.

4.     Highlights

-    Capacity of Carriage Repair Workshop Tirupati and Rail Spring Manufacturing Plant Sithouli remained grossly under utilised.

Para 5(i) and (ii)

-    Enormous investments on modernisation of 4 workshops did not yield the benefits envisaged in the scheme of modernisation; in three workshops the cost overrun was Rs.23.08 crores.

(Para 6)

-    Shortfalls in periodical overhauls (POH) were noticed in Railway workshops due to less/irregular receipt of rolling stocks, lack of materials, power interruptions etc. Shortfalls resulted in loss of Rs.44.14 crores in three railways due to under-utilisation of labour.

Para 7(a)

-    Excess time taken for POH of rolling stock resulted in loss of earning capacity of Rs.38.07 crores on Western, Central and Northeast Frontier Railways.

Para 7(b)

-    Percentage of Arrears of Periodical overhaul of coaches and wagons did not show any improvement during the period under review.

Para 7(c)

-    The extent of rejection of wagon (BG) and wagons (MG) within three months of their POH was high and ranged between 9 and 43 per cent and between 15 and 32 per cent respectively.

Para 7(d)

-    Reasons for wide variations in the average cost of POH noticed in many workshops were not analysed by the Railways.

Para 7(e)

-    Detention to rolling stock before POH resulted in loss of earning capacity of Rs.58.37 crores on Central, Southern, Northern, Western and Eastern Railways.

Para 7(g)

-    Plant and machinery costing Rs.32.76 crores were commissioned after delays of 6 months to 8 years.

Para 8(a)

-    Incidence of idle time ranged between 18.5 and 22.15 per cent of total manhours during 1989-90 to 1991-92.

Para 10(a)

-    Irregular payment of overtime allowance to staff governed by incentive scheme of four railways worked out to Rs.5.05 crores.

Para 10(e)

5.     Under-utilisation of capacity

i)     Carriage Repair Workshop, Tirupati: Shortfall in performance of the Carriage Repair Workshop (cost Rs.58.65 crores) which commenced functioning in September 1985 was commented in Paragraph 2.4 of the Report of the Comptroller and Auditor General of India, Union Government (Railways) for the year 1990-91 The Railway Board explained that the projected target could not be achieved because of non-induction of new coaches on the Railways on account of delay in production of coaches in Rail Coach Factory (RCF) Kapurthala.

Althouth RCF Kapurthala had since exceeded its production target, the utilisation of capacity of the Carriage Repair Workshop ranged between 25 and 35 per cent only during 1989-90 to 1992-93.

ii)     Rail Spring Manufacturing Plant, Sithouli: The Rail Spring Manufacturing Plant, Sithouli (Gwalior) commissioned in March 1990 at a cost of Rs.51.58 crores was to produce 2000 MT of coil spring in the first year (1990-91), 3000 MT in the second year (1991-92) and 5000 MT in the third year (1992-93) for achieving a total saving of Rs.30.33 crores. The actual production of springs was, however, only 952 in 1990-91, 1274 in 1991-92 and 1677 in 1992-93; the shortfall in the outrurn deprived the Railway of the saving of Rs.12.46 crores on import. The average cost of production of spring of Rs.105.28 per Kg. and Rs.88.72 per Kg during 1990-91 and 1991-92 respectively was higher than the market price of Rs.55 per Kg and resulted in extra expenditure of Rs.4.79 crores and Rs.4.29 crores to the Railways. The average cost of production for 1992-93 had not been worked out.

6.   Modernisation of workshops

With a view to achieving reduction in periodical overhaul (POH) cycle time of rolling stock, and effecting economy in the cost of rolling stock maintenance including POH, the Railways made investments aggregating to Rs.390.59 crores on modernisation of 10 workshops in Phase I (Kharagpur, Kancharapara, Lower Parel and Matunga) and Phase II (Jagadhri, Golden Rock, Kharagpur, Ajmer, Perambur and Lilluah).

Ajmer Workshop:     Expenditure of Rs.29.40 crores was incurred upto March 1994 on the modernisation of Ajmer Workshop taken up in July 1986 for completion by July 1990 at an estimated cost of Rs.23.52 crores representing cost overrun of Rs.5.88 crores. Against the targetted increase of POH of 36 diesel locos, the actual increase from 1990-91 was 24; the increase in POH of coaches was nil against the target of 936 units per annum. Shortfall in the out turn of coaches deprived the Railway of anticipated savings of Rs.27.53 crores.

Jagadhari Workshop:     Expenditure of Rs.42.40 crores was incurred on the modernisation of Jagadhri Workshop upto March 1994 against the estimated cost of Rs.32.68 crores. The modernisation did not result in the anticipated increase in the capacity of 1500 units of wagons and 300 units of coaches per month (upto 1992-93).

Carriage and Wagon Works Perambur:     After completion of modernisation (estimated cost Rs.4.25 crores) no improvement in POH time of wagons/coaches was noticed. The time taken for POH of carriages after modernisation actually increased after modernisation.

Golden Rock Workshop:     Modernisation of Golden Rock Workshop taken up in 1985 at a cost of Rs.21 crores for completion by December 1989 was actually completed (c.-A&t-pt in roap&^t uf icvoiupiiig uf ulttiics and Koad Transport Shop) In [WZ-^3 at a cost of Rs.28.48 crores involving a cost overrun of Rs.7.48 crores.

Kharagpur Workshop:     Despite the investment of Rs.55.34 crores, the modernisation ofKharagpur Workshop did not result in any significant reduction in the cost of POH. The output of the Workshop also declined after modernisation: coaches from 3001 to 2531, wagons from 11704 to 9844 and diesel locos from 80 to 60 between 1984-85 and 1992-93. 13 to 18 per cent of wagons were rejected within three months of POH.

7.     Production Management

(a) Shortfalls in Periodical Overhaul:     The targets for periodical overhaul and other repair activities are fixed by the Railway Board keeping in view the installed capacity, holding of rolling stock, requirements of traffic etc.

On Western Railway there were shortfalls of 6610 units in outturn of POH activities of wagons and coaches in Ajmer and Kota workshops during 1989-90 to 1992-93. Loss on account of under-utilised labour was worked out to Rs.6.52 crores.

Loss on account of shortfall in respect of other repair and manufacturing activities during 1989-90 to 1992-93 in Ajmer, Kota, Parel and Dahod Workshops compared to the targets was assessed at Rs.24.86 crores; The main reasons for shortfall in outrurn were less/irregular receipt of rolling stock, lack of materials, power interruptions, diversion of staff to other activities etc.

On Southern Railway, shortfalls in achievement of targets led to loss of Rs.35.68 lakhs and Rs.45.85 lakhs on account of under utilisation of labour in Perambur and Golden Rock Workshops respectively during 1989-93.

On Northern Railway against the annual targets of overhaul of 720 wagons for Bikaner Workshop and 5100 wagons for Alambagh Workshop, the actual outturn ranged between 614 and 685 and between 4007 to 5086 respectively during 1989-93.

On Eastern Railway achievements significantly lower than targets were noticed during 1989-90 to 1992-93 in Jamalpur and Lilluah Workshops for some of the major items, the extent of shortfall ranged between 26 and 67 per cent and between 51 and 68 per cent in the case of wheel supply to Divisions and manufacture of UIC bogies respectively.

On Central Railway shortfalls in outrum of POH of wagons and coaches in Parel, Matunga and Jhansi Workshops during 1989-90 to 1992-93 resulted in loss of Rs. 11.51 crores on direct and indirect labour etc. Shortfall in outturn in Iron and Brass Foundries ofParel Workshop resulted in extra expenditure of Rs.43.29 lakhs on pay and allowances of workshop staff during 1989-90 to 1992-93. The reasons for shortfall were not on record.

New Bongaingaon Workshop of Northeast Frontier Railway failed to achieve the targets ofPOH of wagons and coaches during 1989-90 to 1992-93. The shortfall was attributed by the Deputy Chief Maintenance Engineer of the Workshop to nonavailability of critical items like paint, roller bearings, buffer plunger and less feed of coaches and wagons.

(b)     Repair Time Cycle: The Railway Board had prescribed repair cycle time for different types of rolling stocks. Statistics for 1991-92 brought out by the Railway Board in respect of selected workshops revealed that the actual time taken for POH of rolling stock was far in excess of targets fixed, statistics for 1992-93 and 1993-94 had not been published.

-    Against the norm of 4 days, five workshops (Kota, Samastipur, Izatnagar, Dibrugarh and New Bongaigaon) took 9 to 17 days for POH of wagons.

-    Two workshops (Kharagpur and New Bongaigaon) took 45-46 days for POH of coaches against the norm of 18 days.

-    Kharagpur workshop took 184 days for POH of diesel locomotives against the norm of 25 days, the time taken in Perambur and Parel workshops (Western Railway) was 33 and 42 days respectively.

-    Parel workshop (Western Railway) took 104 days for POH of electric locomotives against the norm of 25 days; the time taken in Kancharapara workshop was 115 days.

The excess time taken for POH/IOH by different workshops of Western  Railway during 1989-90 to 1992-93 resulted in non-availability of MG/BG steam locos for 3526 days for traffic resulting in loss of earning capacity of Rs.7.03 crores.  The loss of earning capacity of BG/MG coaches and wagons for 220269 days was  estimated at about Rs. 15.5 7 crores.

On Central Railway excess time taken for POH of locomotives, wagons and coaches in Parel, Jhansi Workshops during 1989-90 to 1992-93 resulted in loss of earning capacity of rolling stock of Rs.13.75 crores.

On Northeast Frontier Railway because of excess time taken for repair of coaches and wagons in Dibrugarh and New Bongaigaon Workshops, detention to rolling stocks for 24279 days during 1989-90 to 1992-93 resulted in loss of earning capacity of Rs. 1.72 crores for 685 coaches and 300 wagons.

An order was placed on Izatnagar Workshop in April 1982 by the Railway Board for manufacture of 10 ton crane at an estimated cost of Rs.28.77 lakhs per crane. The work which was to be completed within 32 months from April 1984 was actually completed in 1992 at an extra cost of Rs.3.75 crores due to escalation in cost of labour and material. Delay in completion of the work had not only resulted in extra cost due to escalation but also in under utilisation of manpower of the workshop.

(c)     Arrears of Periodical overhaul: The Railway Reforms Committee observed in its second Report (9th Lok Sabha) that coaches overdue for POH was 7.99 per cent on BG and 3.37 per cent on MG and recommended that the Railways should make serious efforts to clear the backlog. Although the Railways assured the Committee that with modernisation of workshops and reduction in POH cycle time, further improvement in this regard would be possible, 9 to 10 per cent of BG wagons and 7 to 8 per cent of BG coaches remained overdue for POH at the end of each year during 1989-90 to 1992-93.

(d)     Quality control: The wagons turned out in workshops are to be certified first by the Neutral Control Organisation (IRCA) before they are sent out for traffic. Quarterly Reports of wagons marked sick within 3 months after POH prepared by Indian Railway Conference Association revealed large scale rejection of wagons within three months of their periodical overhaul as indicated below.

Percentage of rejection of wagons

Name of the workshop




Waeons fBG)












































New Bongaigaon








On Northern Railway 2170 wagons and 672 coaches though rejected by NTXR between April 1989 and March 1993 were not offered to NTXR for certification and were passed without NTXR's certification for traffic use.

The financial implications of large scale rejection of rolling stock were not assessed by the Railways.

(e)     Cost of Periodical Overhaul: The average cost of Periodical overhaul of different types of rolling stocks (as per the statistics compiled by the Railway Board) had increased from Rs.4.10 lakhs and Rs.4.66 lakhs for BG and MG steam locomostives to Rs.6.32 lakhs and Rs.5.80 lakhs, from Rs. 16,198 to Rs.21,031 for BG wagons and from Rs.48,130 to Rs.60,697 for BG coaches between 1989-90 and 1992-93

Scrutiny of outrurn statements of some of the Workshops received in the Railway Board also revealed wide variations in the average cost ofPOH as indicated in Annexure. The Railway Board had not analysed the reasons for such wide variations.

(f)     Deficiencies in the fittings of coaches: The prescribed procedure of joint verification of rolling stock received for POH by the workshop staff and the base depot staff was not followed. In Tirupathi workshop, shortages on account of missing fittings were assessed unilaterally by the Workshop staff at Rs.60.16 lakhs from July 1991 to September 1992. In Lallaguda Workshop loss on account of deficiencies of mechanical and electrical fittings of coaches worked out to Rs.3.28 crores during 1989-90 to 1993-94. The loss on account of missing fittings (both electrical and mechanical) in MG coaches sent to Hubli Workshop for POH during 1989-90 to 1992-93 worked out to Rs.27.83 lakhs. In New Bongaigaon and Dibrugarh workshops of the Northeast Frontier Railway, costly items valued at Rs.46.18 lakhs were found missing during 1991-92 and 1992-93 These shortages had neither been investigated nor written off.

(g)     Detention to rolling stock before POH: Detentions of wagons/coaches in excess of three days prior to their being taken up for POH had resulted in their nonavailability for traffic use and consequent loss of earning capacity. On Central Railway rolling stock was detained at workshops for 73,633 days with resultant loss in earning capacity of Rs.721.76 lakhs during 1989-90 to 1992-93. On Southern Railway rolling stock suffered detention of 81,291 days at Peramber and 5,518 days at Golden Rock resulting in loss of Rs.255.65 lakhs during 1989-90 to 1993-94 (September 1993). On Northern Railway stock was detained for 38,097 days with loss of Rs. 153.54 lakhs during 1989-90 to 1992-93.

On Western Railway 44301 units of rolling stock suffered detention of 14207 days in Kota, Dahod and Ajmer workshops during 1991-92 and 1992-93. The loss of earning capacity was assessed at Rs.9.42 crores.

At Kanchrapara workshop of Eastern Railway, 328 coaches suffered detention for 82 days on an average per coach during 1989-90 to 1992-93 resulting in loss of earning capacity of Rs.6.6 crores. At Lilluah workshop 393 wagons and 3587 coaches suffered detention of 51.76 days per wagon and 37.55 days per coach respectively during 1989-90 to 1992-93 in excess of the maximum time allowed for POH. This resulted in loss of earning capacity of Rs.73.39 lakhs for wagons and Rs.30.31 crores for coaches.

(h)     Loss due to detention of loaded wagons in workshops yards: Western, South Central and South Eastern Railways suffered loss of Rs.8.60 crores by way of earning capacity due to excessive detention of loaded wagons in workshop yards of Kota, Guntapalli and Kharagpur during 1989-90 to 1992-93.

Demurrage charges of Rs.1.24 crores were paid by Ajmer and Dahod workshops during 1989-90 to 1992-93 due to excessive detention of wagons in workshop yards.

Northern Railway paid Rs.33.28 lakhs as demurrage charges for detention of rolling stock (1140 wagons) in Alambagh and Charbagh workshops during 1989-90 to 1992-93.

8.     Equipment Management

(a)     Delayed commissioning of plant and machinery: On Western Railway thirty nine machines and equipment (cost Rs.7.80 crores) remained idle for varying periods from 6 to 26 months during 1989-90 to 1992-93.

On Eastern Railway 33 plants and machinery (cost Rs.8.10 crores) remained idle for 12 to 36 months during 1986-87 to 1992-93.

South Central Railway sustained a loss of Rs.6.12 lakhs due to delay of over two years in commissioning an Electric Plating Plant (cost Rs.26.45 lakhs) received in Tirupati workshop in June 1990.

A Hydraulic Press Brake Machine costing Rs.107 lakhs procured by Northern Railway for Jagadhri workshop in June 1990 was not commissioned by the supplier. The Railway entered into a separate contract with another firm in March 1994 for commissioning of the machine at a cost of Rs.6 lakhs. The machine was put to trial in June 1994 but went out of order in July 1994 and was still not functioning.

One heavy duty carriage and wagon axle journal turning and burnishing lathe costing Rs.148 lakhs purchased in Alambagh workshop Lucknow in September 1990 was commissioned only in January 1992 due to the failure of the Railway to complete the foundation and civil engineering works.

In Golden Rock Workshop 18 machines/equipments (cost Rs.2.75 crores) were idle for varying periods from 6 to 39 months during 1989-90 to 1992-93

In Jhansi workshop 7 machines (cost Rs.174.68 lakhs) were commissioned after delays of 1 year to 8 years because of delay in finalising site for foundation, delay in completion of civil engineering works, defects noticed in the machines and non-receipt of vital components In Parel and Matunga Workshops 7 machines costing Rs.2.09 crores were commissioned after delays of 7 to 12 months due to short supply of certain items and delay in installation of the machines by the firms.

In Kharagpur and Raipur Workshops of South Eastern Railway 44 machines costing Rs.391.73 lakhs received between 1982 and 1992 were commissioned after delays of 6 to 54 months. Reasons for delay in commissioning were (i) incomplete foundation, (ii) machines received in defective condition/with deficient parts etc.

On Northeast Frontier Railway 13 plant and machinery costing Rs.196.65 lakhs received between June 1987 and January 1993 were commissioned after delays of 12 to 42 months in Dibrugarh and New Bongaigaon workshops. The delay in commissioning of machines was mainly due to late completion of foundations.

Three items of machinery costing Rs.1.04 crores procured for Lallaguda Workshop during 1988 to 1992 were commissioned after a delay of over one year The delay was attributed to non-completion of foundation and delay in replacement of deficient parts. Two machines costing Rs.52.83 lakhs were commissioned in Hubli Workshop after a delay of 20 months due to non-supply of accessories in time by the firms.

(b)     Breakdown of Plant and Machinery:     In Ajmer, Kota, Dahod and Parel workshops of Western Railway 24 machines/equipments (cost Rs.1.82 crores) remained idle due to breakdown for varying periods upto 5 years. A Governor Test stand machine costing Rs.5 lakhs and an Eowden Air Compressor machine costing Rs.6.30 lakhs remained under breakdown for 2130 days and 1465 days from February and December 1989 onwards respectively upto December 1993. 14 old machines replaced by new machines had not been disposed of for periods of more than 1 year to 12 years (May 1994). In Parel and Matunga Workshops of Central Railway 9 machines costing Rs.4.05 crores remained idle due to break down for varying periods from 42 days to 5 years.

c)     Under utilisation of machines: In Ajmer workshop five plants and machinery valued at Rs.2.88 crores remained under utilised to the extent of 55 to 99 per cent during 1989-90 to 1992-93; the reasons for under utilisation were less workload, machine break down, power failure etc.

Two axle turning lathes installed in Alambagh and Jodhpur workshops in January 1985 and April 1985 respectively at a cost of Rs.94.71 lakhs remained under utilised to the extent of 84 and 29 per cent respectively during 1988 to 1993 (upto October 1993) and July 1990 to March 1994 due to less workload. One high speed planning machine procured for Alambagh workshop in July 1988 at a cost of Rs.49.18 lakhs was commissioned in August 1992, but remained unutilised for 13 months thereafter (till August 1993) on account of non-fixation of allowed time for incentive purposes.

In Dibrugarh and New Bongaigaon Workshops of Northeast Frontier Railway 42 machines costing Rs.133.74 lakhs were declared surplus. Out of these, 18 machines were found unsuitable on account of changes in operating practices and remained under utilised as of March 1993.

9.     Material Management

(a)     Overstock: The Ministry of Railways (Railway Board) directed the Zonal Railways to restrict the holding of overstock and inactive items to 5 per cent of total inventory. The Workshop Depot at Golden Rock Workshop was holding overstock items valued at Rs.4.28 crores relating to Metre Gauge rolling stocks as of March 1993. Overstocked and inactive items were valued at Rs.3.38 crores constituting 27 per cent of total inventory in two workshops of Northeast Frontier Railway at New Bongaigaon and Dibrugarh as of December 1992. Three workshops at Parel, Matunga and Jhansi of Central Railway were holding surplus stores valued at Rs.2.83 crores as of 31 March 1993. Surplus stores valued at Rs.23.4 lakhs were held by Dahod Workshop of Western Railway due to phasing out of POH activities of BG steam locomotives. Inactive and overstocked items valued at Rs.3.32 crores at the end of December 1993 were held by four workshops of Western Railway viz. Ajmer, Parel, KotaandDahod..

In wagon repair shop, Guntupalli stores valued at Rs.1.03 crores, Rs.1 crore and Re.0.83 crore were lying unutilised on the shop floor at the end of 1990-91, 1991-92 and 1992-93 respectivly.

On Western Railway materials (including scrap) valued at Rs.l 7.76 crores were lying on the shop floor of workshops at Ajmer, Kota and Dahod at the end of March 1993.

(b)     Procurement of over/under sized spares: Spares purchased at a cost of Rs.40 lakhs remained unutilised (February 1994) in Carriage and Wagon Workshop Alambagh on Northern Railway because these were found to be over/under sized. The Railway Administration was unable to give any reasons for the procurement of oversized/undersized spares.

(c)     Irregular procurement of bearings: Northern Railway procured 841 sleeve type bearings at a cost of Rs.44.98 lakhs during March 1990 to September 1991 despite Railway Board's decision in December 1976 to adopt direct mounted roller bearings on ICF coaches instead of aligning spherical roller bearings (sleeve type). Out of this, 260 numbers were used between March 1990 and March 1993 and the remaining quantity of 581 bearings valued at Rs.31.07 lakhs remained unused as of March 1993.

(d)     Rejected Stores: In Parel Workshop of Central Railway 55 items of stores costing Rs.36.53 lakhs were rejected during 1984 to 1993. Neither the rejected materials were replaced nor the amount paid in advance was recovered till June 1994.

10.     Manpower utilisation

(a)     Idle time: Idle time for direct workers arises from power cuts, machinery under repair or non availability of components etc. For such idle time workers get wages without doing any work.

It was observed from the statistics compiled by the Ministry of Railways (Railway Board) that in respect of six major workshops of Northern (Lucknow), Southern (Perambur), North Eastern (Samasthipur), South Central (Guntapalli) and Western (Ajmer) Railways, the incidence of idle time ranged between 18.5 and 22.15 per cent of the total manhours during 1989-90 to 1991-92. Similar statistics for 1992-93 had not been compiled.

During 1989-90 to 1992-93, idle time booked in Ajmer, Dahod, Kota, Parel workshops of Western Railway was 6.93 lakhs manhours out of which 5.34 lakh manhours involving an expenditure of Rs.73.08 lakhs (approximately) were for reasons other than power cuts. 1.26 lakh idle manhours valuing Rs.17.42 lakhs were on account of lack of materials, 0.11 lakh idle manhours valuing Rs. 1.75 lakhs was on account of lack of tools and 0,46 lakh manhours valuing Rs.5.46 lakhs was for want of work, while the balance was on account of machinery under repair and other reasons.

In Carriage and Wagon Repair Shop, Perambur, 1,66,291 man hours were lost as idle time during April 1991 to March 1993 for reason other than power shut down. The loss in financial terms worked out to Rs.17.41 lakhs.

In Central Railway 879266 manhours were booked idle at three Workshops at Parel, Matunga and Jhansi during 1989-90 to 1992-93 for reasons such as waiting for work, lack of material, power cuts, failure of cranes, trains running late, machine breakdown. The financial loss worked out to Rs.79.72 lakhs on the basis of average I hourly {ate of wages.

In Jamalpur Workshop of Eastern Railway though no target for manufacture of 10 ton crane was fixed, 407,896 manhours were available for the work. Even by diverting these extra manhours, the workshop could not achieve the target of six 20 ton crane per year during 1989-90 to 1992-93. The actual outturn varied betwen 2 and 4 cranes a year.

(b)     Surplus Artisans: On Western Railway 429 Supervisors/Artisan staff were rendered surplus in March 1994 due to reduction in the workload for MG steam locomotives in Ajmer workshop and had not been relocated. The recurring expenditure on the surplus manpower amounted to Rs. 11.70 lakhs per month.

On South Eastern Railway, avoidable expenditure of Rs.9.06 crores was incurred upto November 1993 on 531 artisans rendered surplus consequent on shifting of work of POH of carriages at Raipur Wagon Repair Workshop to Mancheswar Carriage Repair Workshop from January 1987.

(c)     Irregular operation of posts: The Railway Board issued directives (November 1991) that the existing temporary workcharged posts at Workshops could be continued till the currency of the sanction and thereafter the same could be created by General Managers only against matching surrenders. 86 workcharged posts sanctioned for the work relating to Diamond Frame Bogies being undertaken in the Carriage and Wagon Workshop Ajmer which expired in March 1991 were continued upto September 1992 without sanction or matching surrender. The delay in surrender resulted in irregular expenditure of Rs.33.95 lakhs upto August 1992.

In Parel and Dahod Workshops on Western Railway 65 posts in different categories were operated without the sanction of the competent authority for more than one year and upto five years in some cases. The expenditure incurred on operation of these posts worked out to Rs.1.07 crores from July 1988 to December 1993.

In Jagadhari workshop of Northern Railway 221 posts in various categories were operated between 1992 and 1993 in anticipation of sanction of the competent authority and expenditure of Rs.9.01 crores was incurred on the pay and allowances.

In Jodhpur workshop irregular expenditure of Rs.52.34 lakhs was incurred on 111 posts and 102 posts of unskilled workers operated in excess during March 1990 to December 1991 and January 1992 to February 1993 respectively.

Delay in surrendering the surplus posts in Jhansi and Parel Workshop resulted in irregular expenditure of Rs. 1.36 crores during January 1990 to April 1992. The staff became surplus due to decrease in target and closing down of POH activity of Steam Locomotives.

(d)     Payment of Incentive Bonus to workers: An incentive scheme i.e. a scheme of payment by results whereby a workman can additionally earn upto 50 per cent of this standard basic wages by increasing his output was introduced in Railway Workshops in 1961.

An amount of Rs.13.69 crores was paid to workers in five workshops on Western Railway as Incentive Bonus during 1989-90 to 1992-93, though the outturn of the workshops had declined. In a number of cases the time saved exceeded 100 per cent of time actually taken. This was indicative of unrealistic fixation of the allowed time.

In three workshops viz. Parel, Matunga and Jhansi irregular payment of Rs.79.52 lakhs towards incentive bonus was made to indirect workers during 1989-90 to 1992-93.

(e)     Irregular payment of overtime: The Railway Board issued instructions in February 1982 (reiterated in August 1992) that no overtime should be booked for the staff working under incentive scheme. Despite this four Railways paid Rs.5.05 crores as overtime allowance during 1989-90 to 1993-94 (Northern Railway Rs.0.83 crore,

Western Railway Rs.0,59 crore and Central Railway Rs.0.79 crores and South Eastern Railway Rs.2.84 crores) to staff governed by the incentive scheme.

The matter was taken up with the Railway Administration and Railway Board between August and October 1994; no reply has been received (March 1995).


( c f Paragraph 7(e)

Average cost of POH in different workshops on Indian Railways

(In Rupees)

i) Diesel Loco (BG)





1 Parel




2 Jamalpur




3 Golden Rock




4 Kharagpur




Variation between minimum
and maximum Percentage




114.15 95.66 275.07

ii) Electric Loco(BG)

















Difference between maximum
and minimum Percentage




 73 230 129.18

iii) BG Wagons





















Difference between maximum
and minimum Percentage




153.49 113.55 78.56

iv) MG Wagons





















Difference between maximum
and minimum percentage




v) BG Coaches





















New Bongaigaon




Difference between maximum
and minimum percentage




vi) MG Coaches





New Bongaigaon
















Golden Rock




Difference between maximum
and minimum percentage




218.47 25.32 28.22

5.2    Electricity Charges

1.     Introduction

The Electrical Department of the Railways is, inter alia, responsible for purchase and distribution of electricity and billing and payment arrangements with the suppliers (State Electricity Boards) and recovery from consumers. Points noticed in test-check of records relating to purchase, distribution and supply of electricity on the Indian Railways are mentioned in the subsequent paragraphs.

2.     Highlights

-    Seven Zonal Railways and Chittaranjan Locomotive Works paid penal charges of Rs.37.70 crores due to consumption of energy in excess of contracted demand.

(Para 3)

-    Two Zonal Railways paid penalty charges amounting to Rs.15.08 crores on account of overshooting of maximum demand due to bunching of trains.

(Para 4)

-    Failure to maintain the prescribed power factor led to payment of penal charges amounting to Rs. 16.44 crores by four Railways.

(Para 5)

-    Zonal Railways paid Rs.27.98 crores as penaltydue to non-installation/non-commissioning and inappropriate installation of shunt capacitor banks which were intended to maintain the power factor.

(Para 6)

-    Due to delay in payment of electricity bills, the benefit of rebate of Rs.67.04 lakhs was lost by various Zonal Railways between the period from 1989-90 to 1993-94.

(Para 7)

-    Energy charges from private parties, Government Departments and other users were not recovered to the extent of Rs.5.14 crores between the period from 1987-88 to 1993-94.

(Para 12)

-    Four Zonal Railways paid avoidable amount of Rs.70.95 lakhs due to less consumption of energy.

(Para 8)

-    Due to defective meters. Northern, Northeast Frontier and Western Railways made avoidable payment of Rs.2.30 crores during the period from 1987-88 to 1989-90.

(Para 9)

-    Due to non-segregation of Industrial and non-industrial load extra paymentsof Rs .26.04 crores were made by various Zonal Railways between the period from 1986-87 to 1993-94.

(Para 10)

-    Due to inability to negotiate the concessional tariff charged by State Electricity Boards for other bulk industries/consumers, Northern, Western, South Eastern and Central Railways were charged Rs.35.28 crores.

(Para 11)

3.     Consumption of energy in excess of contracted demand

According to terms and conditions of the agreements between the State Electricity Boards and the Railway Administrations, the consumption of electricity should not exceed the contracted demand. Consumption of electricity in excess of the contracted demand attracts penal charges for the excess load over and above the contracted load.

Seven Zonal Railways and Chittaranjan Locomotive Works incurred expenditure of Rs.37.70 crores on payment of penal charges because of excess consumption of electricity over the contracted demand during 1989-90 to 1993-94.


Amount (In lakhs of rupees)

South Eastern












* South Central


Chittaranjan Locomotive Works


*     During 1987-88 to 1990-91

Northern Railway paid Rs.7.08 crores on account of excess consumption of energy during 1984 to 1991 due to failure to assess the increase in demand for power and apply for additional load for sub-station at Chanakyapuri well in time. Although the additional load was retrospectively enhanced from November 1985 and again from September 1990, only an amount of Rs.28.47 lakhs out of penal charges could be adjusted. Diesel Component Works, Patiala paid Rs.10.60 lakhs to the Punjab Electricity Board as penalty charges because of failure to take timely action to obtain sanction of additional load commensurate with the demand.

The Railway Administrations need to review their energy requirements, from time to time and secure additional load from the Electricity Boards in order to minimise the payment of penal charges.

4.     Over shooting of maximum demand due to bunching of trains

Integration period is the fixed duration of time jn consecutive minutes for assessing drawal of load for the purpose of determining whether the load is within the maximum contracted demand or not. Railway Reforms Committee pointed out that the integration period of 15 consecutive minutes fixed in the case of some of the Electricity Boards was unduly harsh and a larger integration period of 30 minutes fixed by most of the State Electricity Boards merited consideration and was justified.

On Western Railway the integration period fixed by Gujrat, Maharashtra and Rajasthan Electricity Boards (GSEB, MSEB and RSEB) was 30 minutes, whereas that fixed by the Madhya Pradesh Electricity Board (MPEB) was only 15 minutes. Due to short integration period the bunching of trains on the areas fed by the MPEB often led to over shooting of the maximum demand which resulted in payment of penalty charges amounting to of Rs.525.65 lakhs during 1989-90 to 1993-94.

On Central Railway the Uttar Pradesh State Electricity Board (UPSEB), Madhya Pradesh Electricity Board (MPEB) and Haryana State Electricity Board (HSEB) had hot permitted larger integration period of 30 minutes. This had necessitated payment of penalty charges amounting to Rs.982 lakhs to the State Electricity Boards.

5.     Penalty charges on account of low power factor

Power factor is the ratio of energy available for consumption to that actually consumed. When the power factor is low, the mains and the generator capacity in the power house are inefficiently utilised, the voltage regulation will be poor and system losses and energy bill will be high. Failure to maintain the prescribed power factor necesitated payment of Rs. 1644.17 lakhs towards penalty during 1987-88 to 1993-94 on four Railways.



(in lakhs of rupees)


1987-88 - 1993-94


South Eastern

1989-90- 1993-94



1989-90- 1993-94





6.     Provision of shunt capacitors

Railway Board issued instructions in April 1984, October 1986 and March 1988, to the Zonal Railways for planning the capacitor banks (shunt capacitors) at substations sufficiently in advance to avoid payment of penalties on account of low power factor.

Central Railway paid Rs.4.15 crores to MPEB during July 1988 to June 1991 on account of low power factor in respect of 9 traction sub-stations due to delay in installation of shunt capacitors. The Railway Administration paid Rs.98.26 lakhs as similar penalty during August 1991 to July 1993 because of failure to maintain the power factor despite installation of shunt capacitors at 8 traction sub-stations at a cost of Rs.2.07 crores. In Bombay Division, low power factor due to delay in installation of shunt capacitors necessitated payment of penalty charges of Rs.28.08 lakhs to MSEB during April 1992 to March 1994.

On Western Railway, despite the provision of shunt capacitors at a cost of Rs.3.96 crores, there was no significant improvement in the power factor and the Railway paid Rs.15.45 crores towards penal charges during 1989-90 to 1993-94. Non-improvement of power factor even after providing capacitors was attributable inter alia to improper metering equipment i.e. "Bivector" instead of "Trivector" provided at the sub-stations.

Northern Railway paid Rs.3.70 crores to UPSEB during 1988-89 to 1991-92 on account of penalty for low power factor because of delay in installation and unsatisfactory functioning of four shunt capacitors. This was in addition to the payment of Rs.4.11 crores upto 1988 pointed out in the Reports of the Comptroller and Auditor General of India for the years ended 1985 and 1988.

On Eastern Railway, despite installation of capacitor banks at Karamnasa and Sonenagar, penalty charges of Rs.6,23 lakhs were paid for the period April 1990 and August 1991. Subsequently, when the minimum power factor was raised from 0.80 to 0.85 by the Bihar State Electcity Board (BSEB), the capacitor banks failed to meet the enhanced requirements and the Railway paid penal charges of Rs. 108.29 lakhs for the period September 1991 to May 1994. The capacitor banks had not been replaced as of January 1995. On Kudra and Rafiganj due to non-installation of shunt capacitors penalty of Rs.65.11 lakhs was paid for the period April 1990 and to May 1994. Similar delay in providing shunt capacitor upto February 1991 necessitated payment of penalty of Rs. 15.16 lakhs by Liluah Workshop during 1986 to 1991.

South Eastern Railway paid Rs.1.08 crores to MPEB upto December 1992 because of delay in commissioning of shunt capacitor banks at two traction substations of Nagpur Division. Even after commissioning of the capacitor banks at the above stations, the Railway paid penal charges amounting to Rs. 13.41 lakhs during the period from January to March/October 1993 because the power factor did not improve.

On Southern Railway, delay on the part of contractor in supply and erection of shunt capacitors at all traction sub-stations beyond the contracted period of November 1992 to December 1993, necessitated payment of penal charges amounting to Rs.25.25 lakhs for the period from January to December 1993 on account of low power factor.

7.     Avoidable extra expenditure due to delays in payment of bills

State Electricity Board tariffs stipulate that rebate can be availed on electricity bills if paid within the prescribed period mentioned therein. As a result of delays in processing the bills and payment after the prescribed date the Railways could not avail of the rebate and had to bear an avoidable expenditure resulting in loss of Rs.67.04 lakhs during 1989-90 to 1993-94 as detailed below:


(in lakhs of rupees)









South Central


*     relates to payment of surcharge due to delay

8.     Avoidable payment due to consumption of less energy than contracted demand

The terms and conditions of tariff/agreements with the Electricity Boards provide that billing demand for the month shall be the maximum demand or 75 per cent of the contracted demand whichever is higher.

An avoidable payment of Rs.41.81 lakhs was made by four zonal Railways on account of less consumption of energy than contracted as under:



(in lakhs of rupees)


1987-88- 1993-94



1986-87 - 1990-91


South Central



South Eastern

1988-89- 1993-94


On Central Railway, Rs.0.59 lakh was paid to MPEB at Katni for the period July to November 1987 as minimum demand charges even though there was no consumption of electricity. On the same Railway Rs.13.45 lakhs and Rs.15.10 lakhs were paid in respect of Multai Sub-station for October and November 1992 respectively, though the said sub-station was taken on load from December 1992.

9.     Excess payment of electricity charges

Because of defective energy meter for service consumption at SurajKund Substation from December 1987 to September 1992, Northern Railway paid Rs.1.76 crores extra on account of inflated billing by the UPSEB at 3.83 lakh units per month from April 1987 to March 1988 and 4.21 lakh units per month thereafter upto August 1992 against the average actual monthly consumption of 1.33 lakh to 1.55 lakh units during January-March 1987. On Ferozepur Division, failure to check the electricity bills with meter readings led to excess payment of Rs. 1.94 lakhs.

On Northeast Frontier Railway, following the non-functioning of 33/11 KV transformer meters for New Jalpaiguri and Siliguri Railway Complex in September 1991, the Railway paid Rs.66.78 lakhs in excess to the West Bengal State Electricity Board (WBSEB) for the period from March 1992 to September 1993 because of billing based on average consumption for the two transformers although another Substation transformer was installed at Siliguri Junction on 17th March 1992. Out of the amount overpaid, only Rs.17.28 lakhs had been adjusted as of July 1994.

On Western Railway, Rs.2.85 lakhs was paid to GSEB due to incorrect billing upto August 1989 as per L.T. Panel (old) initially installed.

10.     Non-segragation of industrial and non-industrial loads

State Electricity Boards and other local electric supply companies charge seperate electric energy tariff rates for industrial purposes which is higher than the rate for non-industrial purposes.

Non-segregation of industrial and non-industrial load had resulted in heavy recurring expenditure on account of energy supplied to Railway quarters for which the Railways were billed at industrial tariff rates, while recovery was made from the staff at domestic rates. This resulted in payment of hidden subsidy to the Railway staff.

In four Divisions of Northern Railway (Ambala, Delhi, Jodhpur and Lucknow) and Diesel Component Works, Patiala, payment of energy charges by the Railway without segregating the industrial and domestic loads resulted in subsidy of Rs.8.09 crores to the employees during 1990-91 to 1993-94.

Central Railway incurred expenditure of Rs.3.78 crores towards payment of subsidy to Railway employees for the year 1991-92 alone since the MSEB, MPEB and USPEB which had supplied energy to the Railway in Bhopal, Bhusaval, Jabalpur, Nagpur and Solapur Divisions did not agree to segregation of the load supplied to Railway colonies. The Railway had incurred expenditure of Rs.2.14 crores on account of similar subsidy for the period 1986-87 to 1990-91 on Bombay, Jabalpur, Jhansi, Nagpur and Solanur Divisions.

On Northeast Frontier Railway in the absence of separate metering, the Railway incurred avoidable extra expenditure of Rs.5.68 crores upto March 1993 on account of power used.for domestic consumption.

Southern Railway incurred avoidable extra expenditure of Rs.4.24 crores on payment of electricity charges to the Tamil Nadu Electricity Board because of its failure to keep the lighting and non-industrial loads within the sanctioned load as a consequence of which the entire consumption was charged at H.T. tariff. In Mysore Division extra expenditure of Rs.6.3 lakhs was incurred on payment made to Karnataka Electricity Board because of non-segregation of domestic loads and other loads.

On South Eastern Railway because, of drawing power for domestic and operational and maintenance purpose from one source, extra expenditure of Rs.71.26 lakhs was incurred during December 1988 to March 1991.

Although electricity consumed in construction, maintenance and operation of the Railways is exempt from the electricity duty under the Constitution, failure to segregate dutiable and non-duitable electricity resulted in payment of Rs. 14.12 lakhs and Rs.13.31 lakhs towards duty on Central and Western Railways for the years 1984-85 to 1993-94 and 1987-88 to 1988-89 respectively.

On South Central Railway, APSEB agreed to grant the benefit of lower non-industrial tariff in cases of energy utilised from High Tension supply units provided more than 51 per cent of the total load was consumed for domestic purposes. The Railway Administration took 10 to 15 months to identify only 11 such points; the delay led to loss of Rs.106.17 lakhs between August 1992 to October 1993, on account at payment at higher tariff. The Railway Board stated (January 1995) that as on date out of 67 H.T. supply points 43 had been identified for discounted tariff.

11.     Inequitable Tariff for Railways

Railway Reforms Committee in its Report (1982) observed that in the matter of charging freight, the Railways treat SEBs at par with the industries. There is, therefore, no justification for SEBs to charge Railways higher rates than those charged by them from other bulk industries/consumers. The committees constituted by the Department of Power, Government of India, suggested in August 1988 that the tariff for Railway Traction should not be higher than the high tension industrial tariff for other consumers. The Public Accounts Committee (PAC) (1990-91) in its report on Railway electrification also reiterated, that the Railways should be provided electricity at reasonable rates. Despite the above recommendations, the Railways are still being charged a higher tariff as compared to the industrial sector.

On Northern Railway levy of higher tariff by UPSEB for traction power supply for Mughalsarai-Kanpur and Kanpur-Delhi sections compared to the tariff charged from large/heavy power users, burdened the Railway with extra expenditure of Rs. 17.40 crores between January and December 1992. With the switchover to the National Thermal Power Corporation for traction load in Kanpur-Sahibabad (Delhi) section, the approximate savings on electric energy cost has been estimated at Rs.29.50 crores per annum.

On Western Railway the tariff levied by MPEB was higher by 12.30 per cent than that for other industries leading to additional burden of Rs.1659 lakhs on the Railway during the period 1989-90 to 1993-94.

In respect of Rajnandgaon and Panijola, because MPEB did not classify the Railways as an industrial user, South Eastern Railway paid an excess amount of Rs.63.02 lakhs on account of higher tariff between October 1992 and September 1993. In the Khurda Road Division, refusal of the Orissa State Electricity Board (OSEB) to grant the tariff rate applicable to large industries led to extra burden of Rs.23 lakhs on the Railway during 1993-94.

In Central Railway on Jabalpur Division MPEB charged the Railway as per tariff for General Purposes' instead of at the tariff offered to bulk industrial consumers. This resulted in an additional expenditure amounting to Rs.43 lakhs during the period from 1989-90 to 1993-94.

12.     Outstanding dues

An amount of Rs.514.29 lakhs was outstanding recovery on account of electricity charges from private parties/outsiders and Government departments such as Government Railway Police, Railway Institutes, Union Offices, Post and & Telecommunications and Defence Departments for varying periods from 1987-88 onwards. This included Rs.111 lakhs due from private parties and other Government

Departments on Central Railway alone. On Eastern Railway, the party-wise break up of the outstanding amount of Rs. 196.34 lakhs was not available.

On Northern Railway, Rs.18.52 lakhs was outstanding against the staff for the period from 1988-89 to 1990-91 on Ambala Division. In Delhi Division, 62 employees who were in unauthorised occupation of Railway quarters for 2 to 10 years had not paid the electricity charges.

The matter was taken up with the Railway Administration and Railway Board between June and November 1994; no reply has been received (March 1995).


New Delhi The
10 APRIL 1995

Deputy Comptroller and Auditor General of India



New Delhi The
10 APRIL 1995

Comptroller and Auditor General of India