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QUOTATION OF STATION TO STATION RATES (STS)

 

To attract additional traffic by offering freight discount-

Main features of the scheme:-

1. Applicable to both existing as well as new traffic.

2. Station - to - station concession in freight rates will be applicable to a specific stream of traffic of a particular commodity for movement between a pair of specific originating and destination stations.

3. The concession can be granted either to a consignor or a consignee both for ?paid' and 'to pay' and only for block rate traffic.

4. Concession under Station to Station scheme will be granted only if the Rail user offers written commitment to move traffic equal to or higher than the benchmark level during the proposed period.

5. The Station to Station Concession will be in the form of percentage discount, over the prevailing freight rates and only on that volume of traffic to which concession under no other scheme has been granted.

6. No concession in freight rates will be granted in respect of the following commodities:-

a) All commodities with classification below dass-110.

b) Coal (all types)

c) Lignite

d) Livestock

e) 'Dangerous' commodities or those having suffix 'd' with their nomenclature in the Goods Traffic except P.O.L. products.

7. Station to Station concession in freight rates may be granted for a period of not less then three months and not more than twelve months. For new traffic, it may be granted for a maximum period of three years.

8. Concession under the scheme will be granted only on the recommendation of both CCM & COM duly concurred by FA & CAO and with personal approval of the General Manager of the Zonal Railway.

9. The applicant will be required to furnish a General Indemnity Bond to pay under charges equivalent to the total amount of freight concession proposed to be availed to indemnify the Railways against loss of revenue in case of non-fulfillment of the commitment.

10. The maximum level of Station to Station concession would be as follows:-

Group

Commodities classified at

Maximum concession in freight rates on the retained traffic offered up to the benchmark

Max. concession in freight rates on the incremental traffic offered above the benchmark

I

Class-110 to Class-135

Upto10%

Upto12%

II

Class-140 to Class-175

Upto12%

Upto18%

III

Class-180 to Class-300

Upto15%

Upto24%

The main objective of offering the discount will be to retain the existing levels of earnings and also attracting additional traffic to rail to generate higher revenue. The level of earnings will be judged on the basis of total earnings from that particular stream of traffic by the rail user during the corresponding period of the preceding year.

STATION-TO-STATION RATES

Benchmark:

Existing Traffic:

Average volume of traffic, in tonnes, for the same commodity (including traffic booked under STS or any other concessional scheme) moved by the same rail user, between the same pair of originating and destination Stations/Points, during the corresponding, period of the corresponding period in the previous 3 (three) years.

New Traffic:

For the first year the benchmark for "New" traffic will be fixed by the zonal railway administration, in consultation with the prospective rail user, keeping in view the existing offer from other rail user and the need to capture the new traffic on long term basis. For the second and the third year, the benchmark for new traffic will be the volume of traffic, in tonnes, moved by the same rail user during the previous year of the same commodity between the same pair of originating and destination Stations/Points.

Fulfillment of Commitment:

Total commitment of individual rail user for the period of operation of the scheme should be distribution as monthly and quarterly targets, in consultation with the rail user, starting from the month of commencement of the scheme. All efforts should be made that commitments are fulfilled on monthly basis. However, in case of any failure on the part of rail user or constraints such as short supply of wagons, operational restrictions etc. or any reason whatsoever, the monthly shortfalls must be made good during the three monthly quarter so that the total commitment for the relevant quarter is fulfilled. In case of failure in fulfilling the commitment even for the three monthly period, the STS concession in freight would not be admissible for the particular month (s) during which the commitment target(s) was not achieved.

However, in the case of the rail user who has applied for concession in freight rates under this scheme for a period of 12(twelve) months and who fails to achieve the commitment target for the last quarter of operation of the scheme, the benefit of STS for the last quarter could be extended provided:

i) The shortfall is made good in the first quarter of the next period of operation of the scheme, and

ii) The rail user continues to offer traffic under the STS scheme for a further period of 12 (twelve) months.

Scales of Concession:

Maximum limits of STS concession would be as follows.

Group

Commodities classified at

Maximum concession in freight rates on the retained traffic offered up to the benchmark

Max. concession in freight rates on the incremental traffic offered above the benchmark

I

Class-110 to Class-135

Upto10%

Upto12%

II

Class-140 to Class-175

Upto12%

Upto18%

III

Class-180 to Class-300

Upto15%

Upto24%

For the same commodity, the rail user offering higher incremental volume of traffic may be considered for higher concession. The level of freight concession for existing traffic would also depend upon the need for retaining the existing level of earnings from that traffic as well as other factors like competition from road traffic, idling or rolling stock etc.

Modalities:

Rail users desirous of availing STS concession in freight rates will be required to apply for the same giving written commitment in respect of traffic to be offered, in tonnes, during the proposed period. STS concession in freight rates may be granted for a period of not less than 3 (three) months and not more than 12 (twelve) months.

For the "New" traffic, concession in freight rates may be granted for

maximum period of 3 (three) years.

The applicant will also be required to furnish a General Indemnity Bond to pay undercharges equivalent to the total amount of freight

concession proposed to be availed to indemnify the Railway against loss of revenue in case of non-fulfillment of the commitment in respect of traffic offered for rail movement under this scheme. If the applicant is a "Consignee" the General Indemnity Bond should be endorsed by the consignors).

Concession in freight rates under the STS Scheme will be granted only the recommendations of both CCM and COM, duly concurred by FA & CAO and with personal approval of the General Manager of the Zonal Railway.

Traffic in respect of rail users who have been granted concession in

freight rates under the STS scheme will be booked at the reduced

freight rate in case of "Paid" traffic.

In case of "To Pay" traffic, STS concession would be leviable on the normal freight rate and will be granted as a refund to the rail user on quarterly basis on fulfillment of the commitment. The To-Pay" surcharge will be calculated at the destination on normal freight rate as per the extant rules.

Zonal Railways should raise undercharges against the rail user who fell to fulfill their commitment of offer of traffic as para 5.0 and initiate action to invoke the General Indemnity Bond to recover the amounts due to the Railways.

Zonal Railways may forward such proposals for STS concession in

freight as are not covered under these guidelines, to Railways Board with full details and complete Justification. Such proposals must have recommendations of both CCM and COM, concurrence of FA & CAO and personal approval of the General Manager.

 




Source : Eastern Railway CMS Team Last Reviewed on: 30-11-2010  


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