Axle counter is a device which is used by IR to count the no of axles of a train when it leaves a train for next station ...
That route is occupied..
When the same no of axles are counted and match the previous value of previous station ..ie the same train enters the next station ..then only the route becomes clear for other trains ...
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a safety device which displays the section BTW two stations occupied or available for other trains ..
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In Automatic Block Signalling ..
Axle counters work same as they work BTW two stations ..
But here they are used to provide info whether that block is clear or occupied for next train ..
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If the value of axle counter at beginning and end of the section doesn't match ..Then that section will be occupied for other trains ..to enter ..

Best explanation by example ..
Suppose A train leaves station A for station B .
Station A has axle counter and it counts the Wheels and axles of the train leaving Station A for station B .
After the train entered that section , Axle counter will display the section as Occupied .
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same train enters Station B .Again axle and wheels are counted .
Then both data are matched ...
If found equal ..Axle counter at Station A and B will display the section clear /unoccupied .
If not matched, The it will show occupied and the Station Master cannot send other train btw the station A and B.