Earnings - Comptroller and Auditor General of India

Report No.6 of 2006 (Railways)Further scrutiny of records revealed that• No proposals for rationalisation of routes were sent by Central, NorthWestern and North Eastern Railways.• South Western Railway had proposed rationalisation of this route inOctober 2003 but no action was taken by Railway Board to include thesame in General Orders.• North Central Railway sent the proposal only in May 2005 after thedraft paragraph was issued.• Northeast Frontier Railway had proposed to rationalise the route inAugust 2003 for coal traffic but the results of their proposal were notavailable.Thus the failure of the Railway Administration to review the rationalisationscheme as required by Railway Board from time to time and non-inclusion ofthe proposal of South Western Railway has resulted in loss of revenue ofRs.26.04 crore as indicated above.When the matter was brought to the notice of Railway Administrations of therespective Railways (February 2005 to May 2005) they stated as under:Central RailwayRailway Administration stated that traffic was being routed by the longer routebecause the shorter route was not electrified and Diesel locomotives were notavailable at Balharshah. The reply is not satisfactory as there is no proposal yetto electrify the shorter route and traffic is to be carried by longer route for anindefinite period involving extra expenditure on haulage of each rake for adistance of 64 kms. In order to compensate for the extra expenditure it isimperative that the route is rationalised.North Central RailwayRailway Administration has furnished the proposal for rationalisation to theRailway Board in May 2005 but claimed in their reply that carriage of goodsby the operationally feasible route has saved Railways not only time andresources but also increased the opportunity to carry more goods by improvingupon the rake availability. Action of the Railway Administration in sendingthe proposal confirms Audit’s conclusion. The claim of increased turn roundand consequent earnings was not tenable because the movement of rakes by thelonger route also involved extra expenditure on account of additional haulagewhich needed to be compensated by rationalising the route.South Western RailwayRailway Administration has stated that loss pointed out by Audit was notacceptable as the movement by the shorter route would involve extraexpenditure and that the proposal for rationalisation which was sent in October2003 was pending with Railway Board. Action had already been initiated topersuade the parties to opt for the movement of their goods by longer route.Additional costs on movement by shorter route, as stated by the RailwayAdministration, is another argument in favour of rationalisation of the longer50