The fire broke out in the AC 3-tier coach B-1, fourth from the engine, near Sri Satya Sai Prashanti Nilayam Railway station, about 170 km northeast of Bangalore, at 3.45 am when most of the passengers were fast asleep.
There were 65 passengers in this coach, many of whom managed to jump out or escape by breaking open the window panes of the toilet cabins, Railway and police officials said.
According to survivors, they woke up to the "burning sensation" and screams of "fire fire" and cries for help, and managed to escape rushing towards the door and jumping out or by breaking open the windows in lavatories.
Though 39 of the passengers were lucky as they managed to alight, some of them lost their loved ones on board.
Charan, a resident of Bangalore, saved 20 other passengers from the bogie but his wife and fahter-in-law were consumed by the fire, AP Revenue Minister N Raghuveera Reddy, who hails from the district said.
"I saw panic-stricken people scrambling towards the door, all trying to get out. I managed to get out when the train stopped," he said.
Railway Minister Mallikarjun Kharhe, who rushed to the accident spot, said 26 people have died and the bodies have been sent for forensic examination and kept in the hospital in Bangalore for identification.
He said only nine bodies had been identified and efforts were on to find out the kith and kin of the victims through the addresses given by them or using the mobile phones. A two-year-old baby girl is among the dead.
Kharge announced an inquiry by Railway Safety Commissioner adding the probe would unearth "what are the lapses.. How it happened, lack of maintenance or negligence of staff or faulty electricity , everything will be done.
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