Railway Accounts Department Examinations

Tuesday, August 28, 2018



One must be cover up the entire Engineering Code i.e., all chapters for attempting the optional General Expenditure Paper and GRP - General Rules & Procedures.  However, among the total 19 chapters, the following Nine chapters are more important and for quick revision.

Chapter No
Click the given LINK for ready access
Organisation & Administration
Investment Planning & Works Budget
Execution of works
Contracts for Works
Initial Records
Initial Account of Revenue & Works Expenditure
Expenditure & Budgetary Control
Completion of Railway Projects


CIVIL HEADS - Important one. asked many times in previous III A exams.

Civil Heads

v      Introduced w.e.f 01.04.1989.
v      The Railways will book the payments and receipts relating to the heads controlled by other Civil Departments (except those relating to services rendered by the Railways to the latter as a commercial Department).   Such heads are known as Civil Heads.
v      The amounts are straight away booked to Civil Heads.
v      Civil Heads formed as distinct sub head below the Public Account in the Monthly Account Current.
v      At the end of the financial year, the balances under Civil Heads are not carried forward to the Next financial year.  These Heads are closed to “Government” in Railway Accounts.

v      Examples are

                                 1.        Recoveries of Income Tax from employees and contractors/suppliers.
                                 2.        C G I S recoveries (Rs.30 for Gr. C Staff etc)
                                 3.        Recoveries of P L I (Postal Life Insurance) from the employees.
                                 4.        Payment of Dividend to General Revenues
                                 5.        Interest on Loans from Central Govt. and Railway Funds.

v      Advantages:

                                 1.        Elimination of cash payment for transactions where Railways functioned merely as agents of other Civil Depts (example is recovery of income tax from salaries behalf of Income Tax Dept.).
                                 2.        It is no longer necessary for the Railways to issue cheques for payments due by Railways for recoveries or recover cash for payment made.
                                 3.        Avoid inflated turnover (of cash) of RBI/Other Banks firstly at the paying end and then at the receiving end without any tangible results.
                                 4.        Process of booking under PAO  Suspense Head has been greatly reduced.




Codes and Manuals of Indian Railways

for access to 
all codes and manuals of Indian Railways

Annexure J of Appropriation Accounts - A Power Point Presentation

Difference between Vetting and Concurrence

Difference between Vetting and Concurrence

Vetting:   refers to conforming of a factual correctness of figure or statement of figures.
Examples: Vetting of Briefing Note, Estimates, Purchase Order etc.

Concurrence:  refers to agreeing a proposal in its entirety including the figures given under proposal.
Examples: Concurrence for construction of new bridges, replacement of machinery, etc.

Note: Extract from the comments given by F(X)/Dte in reply to information sought under RTI Act, 2005.


How to attempt the with Books question paper of Optionals in Appendix III (IREM) exam - Here is the expert guidance offered by Ms.Usha Raman, Faculty at University of Hyderabad

How to attempt the “With Books” question paper in Appendix III A Examination
(Excerpts from the article “Have  you ever written on open book or take-home examination” by Usha Raman.  The article is published on 08th April, 2013 in Hindu Newspaper. For full article refer the given link

ü  The questions were designed in a way such that the answers would not be readily available from any single text or source.

ü  Students should apply their own ideas to the questions before they could come with answers in such examinations.

ü  The questions themselves were fairly open-ended, and as such, did not have any one “correct” answer.

ü  A few were excited at the possibility of such open-endedness.

ü  As we progress through higher levels of education, we need to develop the ability to tackle a variety of question formats and test patterns. 

ü  Questions that draw on a combination of information recall and critical thinking, which demand that we draw not only on what has been taught overtly in a course, but also on a broader understanding of issues and also our own experience.

ü  Obviously, these questions do not have a single correct answer.

ü  They may be answered from a variety of perspectives and bring in widely divergent pieces of information.

ü  It’s about seeing for yourself if you are good enough to get to the next level. It’s up to you to set the boundaries of the answer (within reasonable limits of course) and think in unexpected ways. In fact, that is the only expectation—that you will do the unexpected.

(The author teaches at the University of Hyderabad and edits Teacher Plus magazine. 
Email: usha.raman@gmail.com )

UN ECONOMIC BRANCH LINES - An important question for IIIA examination - repeatedly asked

1987,1988,1991 (with Books) & 1990,1992 (without Books)                                        5 Marks  - short notes question
Ø  Definition of Branch Line: 

     All Narrow gauge lines and such lines that join the Main line net work at one end only are termed as branch lines ( based on the recommendation of Uneconomic branch lines committee, 1969)

     Definition of Uneconomic Branch Line:

Ø   The Branch lines which do not earn profits are termed as Uneconomic Branch Lines  or un remunerative Branch Lines  .

Ø  Assessment on territorial basis of the financial results of the branch lines indicates that some of them suffered a loss. The aggregate loss on these un remunerative branch lines (total 90 lines) amounts to Rs. 1681 cr in 2011-12 year against investment of Rs.2617 Crores.

Ø  Several high-level committees have unanimously recommended that all such uneconomic branch lines, where alternative modes of transport exist or can be developed, should be closed down so as to reduce, to the extent possible, the losses which accrue to the Railways, year after year. There is, however, reluctance on the part of state governments to close down such lines.

Ø  The Railway Reforms Committee in Part XI of their report on ‘Economies’ (October 1983) had recommended that (i) 40 such lines where adequate alternative road infrastructure are available & (ii) 17 such lines in Gujarat where alternative road infrastructure could be developed, should be closed down and in cases where the state governments do not agree for closure for their own reasons they should share the losses with the Railways on 50:50basis. Instructions have been issued for closure/dismantling of 21 uneconomic branch lines (15 out of 40 & 4 out of 17 referred to above and 2 other uneconomic branch lines).

Ø   In order to enable the state governments for closure of the remaining 36 lines, the Railways are ready to offer financial assistance as under:

(a)  On one time basis, the Railways may subsidize the procurement of additional buses required due to
closure of rail sections subject to the State Government agreeing for their permanent closure.

(b)  Again, on one time basis, Railways may offer financial assistance for
development/improvement of road infrastructure which will be a prerequisite for withdrawal of train services.

(c)  Offer of Railway embankments in respect of 13 lines in Gujarat for conversion into all
 weather metalled road.

2017-18 year data on uneconomic branch lines 

v  Total lines – 105
v  Total loss during that year – 4238 Crores. (excluding dividend on their account)

Ø  In spite of showing losses, these branch lines worked due to public pressure and opposition of State Government to close such lines.

  • The Railway Reforms Committee recommended closure of 40 such lines but due to stiff public resistance and opposition by State Governments towards withdrawal of such services, only 15 lines have been closed permanently by the Railways. 

Ø  The running of above lines as part of social service obligation on Indian Government Railways

Ø  The Dividend liability on these lines is subsidized from General Revenues .

Ø  Financial results of these lines will be worked out on marginal cost principle.  If any Branch line showing profits, then the dividend will be paid.

Ø  The Annual Statement  regarding the financial results of the “uneconomic branch lines  is submitted to the Railway Board in prescribed form.

Ø  This statement should also indicate the steps taken to improve the performances and reduce the working expenses.

2017-18 Indian Railways Year Book


TWFA - Transfers Without Financial Adjustments

1990,1995,1997 (with out Books) & 1994 (with Books)                                         5 Marks  - short notes question   
ü Expanded as “Transfers Without Financial Adjustments:”

ü Relates to Adjustment of transfer of Rolling Stock assets from One Railway or Unit to another Railway or Unit.

ü Journal Entry is not required.    Also raising Debits on another unit is Not required.

ü Done only through adjusting into the financial books of the Two Railways or Units by Transfer Entry.

ü The amounts simply added up in the Opening Balances for the year of Unit taking over the asset, and

ü Deducted from the Opening Balances for the year of the Unit surrendering the asset.

ü Purpose/ Advantage  of T W F A  :

1.      To avoid effect on financial accounts and budgeting.
2.     To rectify the progressive balances in respect of the accounts of the previous year already closed.
ü True examples of T W F A are:
A.    When the former State Rlys were integrated with the Indian Rlys during the year 1952, all assets belonging to the former were taken over by the respective zonal Rlys
B.     The existing balances in SRPF transferred to NCSRPF.

CAPITAL FUND - An Important short notes/Essay type question


1995 (with Books)   1997 (without Books)                                          5 Marks  - short notes question   

        Ü  Created w.e.f 1992-93 in pursuance of the recommendation of RCC 1991.

        Ü  Operated as a Minor Head under Major Head 8118.

        Ü  Credits to the Fund are:

A)     Appropriation of the Revenue Surplus after meeting obligations of

§  Payment of Principal as well as Interest on Loan to  D.F.
§  Appropriation of current year D.F.
§  Payment of deferred dividend.
B)      Interest on Capital Fund ( at the rate decided by the RCC)

        Ü  Debits to the Fund are:
 A)     This Fund is utilized to finance expenditure until now charged to Loan Capital , to the extent of balance available under this Head
B)      No separate rules existing for utilizing this Fund usually charged to all Plan Heads (except Plan Heads 11 & 51).

        Ü  To reduce the borrowings from General Revenues (i.e., Loan Capital or Gross Budgetary Support (GBS) from Government).  Because the loan capital  is non -refundable and interest bearing loan.  The Interest is paid in the form of Dividend to General Revenues.  Since Loan Capital is non – refundable, the payment of dividend also perpetual. 

        Ü  Year by year, the GBS (Gross Budgetary Support to Railways is declining. During 1975-76, the GBS is around 75 %.  Now in the year 2011-12, it came down to 34%.

        Ü  Plan Size of the Railways cannot be reduced, since capacity restrictions would endanger the economic progress of the country.   The gap between the requirements and the availability is to be bridged.  The only way is to increase internal resources, that’s why the creation of Capital Fund.

        Ü  No dividend will be paid on the expenditure met from the Capital Fund, as the same is generated from internal resources ( not borrowing from General Revenues).  On the other hand, Interest is credited to the Capital Fund on the balance of the Fund at the end of financial year.  (Rate of interest is equal to the Dividend rate and recommended by RCC from time to time)

        Ü  Total Investments made from Capital Fund till 2010-11 were Rs.38676 croresThat means every year, actual saving of Rs.2320 crores by avoiding dividend payment, since these investments are met from Capital Fund, not Capital. (if assumes dividend rate is 6%).


1990,1993,1994 (with Books)                                                          5 Marks  - short notes question    

       Ü  During the course of accountal in books, an expenditure or income wrongly appeared in any other Head of Account instead of Proper Head of account, the mistake is known as MIS CLASSIFICATION.

       Ü  During the course of financial and other reviews, it is checked that whether there is any booking misclassified and if found the same is regulated in the same year through Journal entry.

       Ü  Examples are:

§  Booking in HBA instead of Motor Car advance.
§  Booking in Coaching Earnings instead of Goods Earnings.
§  Booking in One Demand instead of another Demand.
§  Booking in Revenue Demand instead of Plan heads or vice –versa.

        Ü  A statement showing items of misclassification and other important mistakes either detected by Statutory Audit or by Accounts should be prepared in ANNEXURE – J (Statement of important misclassifications and Other important mistakes detected)
        Ü  Pro forma of Annexure J is as follows.

Name of Railway               Grant affected   Brief description of Mistake   Amt.(Rs.)             



RSBY - Rashtriya Swasthya Bima Yojana

RSBY - Rashtriya Swasthya Bima Yojana

Being the latest  scheme ( In Indian Railways - 2011 year), this may be asked as Short Notes question in Appendix III A Examination.
»   launched by Ministry of Labour & Employment, Government of India in the year 2008.
»  Objective:  Protecting BPL(Below Poverty Line) families & informal sector workers of India from the shocks related to catastrophic expenditures of health by provide Health Insurance cover.
»    A Social Insurance scheme.
»  It is a Smart card based, Paperless and cashless facility.
»  Annual hospitalisation cover up to Rs.30,000 per family of 5 members.
»  Transportation expenses - Up to Rs.1,000 per year - provided in cash - for facilitating travelling to Hospital.
»  Rs.30 is one time registration fees paid by the beneficiaries at the time of registration.
»  Implemented through Health Insurance Companies by empanelling the hospitals throughout the India. Already 12,000 Hospitals are empanelled.
»  Premium paid to the Insurance companies   - 75 % by Central Govt.  and balance 25 % paid by State Govts.
»  Approximate premium is Rs. 350 in 2012 year.
»  No age limit for enrolment into this Scheme.
RSBY -Indian Railways

*               Authority: RBE No.12/2011 (Rly Bd. Letter No.2010-E(LL)/AT/USW/1 dated 27.01.2011.

*               As part of CSR - Corporate Social Responsibility, Indian Railways extends this scheme to APL (Above Poverty Line) categories in Indian Railways i.e., Licensed Porters, Licensed Vendors & Licensed Hawkers in the year 2011.

*               Because, the BPL (Below Poverty Line) categories of people are already covered in this Scheme by Ministry of Labour & Employment, Govt. of India.  But Indian Railways ensure that Licensed - Porters, Vendors & Hawkers under BPL  are covered under RSBY scheme implemented by the respective State Governments or not.

*               Main Points - RSBY - Indian Railways

A.    Railways share of premium  is Rs.565 per family or 75 % of Annual premium whichever is less

B.    Remaining 25 % premium - bear by the beneficiaries only, not State Govt. (because people covered under APL category)

C.     Zonal Rlys have to pay full premium one year in advance.

D.    Monitoring Dept. is Commercial Dept by nominating Key field officer at Divisional level and Co-ordinating Officer at Zonal Level.

E.     Implemented through State Nodal Agencies by State Govts.

F.     Accountal of Expenditure:

Abstract K - Demand No.12 - Misc. Working Expenses
Minor Head 600     -          Other Expenses
Sub Head     660     -           RSBY
Detailed Head 661 -          RSBY Premium
                            662 -          Other expenses
                            663 -          Credits for contributions paid by


Readers are advised to spread awareness of RSBY to the needy persons in Railways i.e., Licensed - Porters, Vendors & Hawkers as well as BPL categories in other sectors (Outside the Indian Railways) as part of our Social responsibility.