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You can change boarding point any time you like after booking the ticket, so that you don't have to cancel the ticket and buy another.

Railway will cancel your ticket if they can't find you in a fixed number of stops and will assign your reserved seat to a person who boarded the train with waiting list ticket.

Also, some stations will have a fixed quota of tatkal tickets. If train runs from X-A-B, where A is a popular station where people are more likely to take the ticket and run out of quota, it makes sensible to take ticket from X-B and change boarding station to A, afterwards. (Source: My friend who is expert at ticketing)

Recently I found this Boarding point feature very useful.

I was booking ticket in Rajdhani from A to B but it was giving me error "BOOKING NOT ALLOWED FOR GIVEN PAIR OF STATIONS". The reason for this error is "If you're trying to book a ticket for a short journey on a train that travels a long distance, you might encounter this error message."

So I booked ticket from X(Source station which is just two station before A) to B and changed my boarding to A.

Indian trains cover very large distances over multiple days and have various stoppages along the way. The reservations are usually done at least 2-3 months in advance and for this reason, having a little bit of flexibility in case of change of plans is very useful and convenient for the people.

Instead of canceling the entire ticket and trying to re-book it from a new station along the way, it becomes handy to just change the boarding point while still having a confirmed ticket in hand.

It might surprise some but the volume of people that travel in Indian trains every day is so huge that some people do not get confirmed seats even if they book well in advance. The ticketing system is very advanced and is designed based on the traffic which means that if X-B is a more popular travel route, more percent of seats will be allotted for this route on a particular train than A-B. It is referred to as quota but it is just based on traffic. Any tickets being booked from X-B will have more probability of a confirmed reservation than A-B.

For this reason, people sometimes knowingly book tickets from a different station even if it costs more. Also, the entire reservation system is transparent so at the time of booking, you can very well see if there are seats left on A-B route or not and then book from X-B in case the seats are taken. You can still get a wait-list ticket for A-B but that will be a risk because then your confirmation will depend on somebody else canceling their A-B tickets for more seats to open up.

In Indian Railways there is a system called Reservation Against Cancellation or RAC. This is, let us say there are 700 seats in a train, then 750 people can book the ticket and board that particular train. A few seats (one per compartment) will be given to two people instead of one. So basically two people are alotted to the same seat. Now let us say someone did not board the train. Then the conductor will allocate that seat to one of the person who is under RAC.

Now let us say, you booked a ticket from Mumbai, and decided to boared from Kota; the problem now is, when the conductor comes, you have not boarded from Mumbai and your seat will be allocated to the guy under RAC. To prevent this from happening you have to change your boarding point to Kota, so that the conductor knows that you didn't miss the train but will instead board from Kota, and your seat won't be allocated to someone else.

Consider a train with 150 seats. Consider the route has 3 stations A-X-B. A is the starting point and the larger and popular station, so it is assigned more seats for reservation. Consider it to be

A: 125 seats

X: 25 seats

Logically, there are more chances of getting a confirmed ticket for the route A-B than X-B.

Indian Railways sells a lot more tickets than the number of seats on the train, so the ticket you buy can be in Confirmed,RAC or Waiting status.

• 
  Confirmed - You have a seat number and a bed assigned


• 
  RAC - Your ticket would be in RAC if all the seats have been sold off. This mean you can get into the train and sit in some
  seat assigned by the TC, but you would only get a bed if someone
  with a confirmed seat cancels their ticket or fails to turn up
  in the train at their boarding point.


• 
  Waiting List - This means all the Confirmed and RAC tickets have been completed and you are on a wait-list. You are not allowed to board the train with a ticket in this status. Your status might change
  daily until the day of departure depending on the number of
  Confimred/RAC passengers cancelling their tickets.

So, I can buy a ticket for A-B and put the boarding point as X, in the following scenarios:

1. I want to have a better probability of getting a Confirmed ticket
   rather than a RAC/Wait-listed ticket and I don't mind the extra
   charge I pay for my lesser distance.
   If I just buy a ticket from A-B without specifying any boarding point
   and try to board at X, I would be marked as a no-show and my seat
   would've already be given to some RAC passenger.
   So the proper
   procedure of booking would be to buy a ticket for A-B with boarding
   point as X. This makes sure I have my seat and bed free when I board in station X.




2. I had originally intended to travel from A-B, but later changed my
   plans and want to board the train at X. If I cancel the whole ticket
   and try to buy a new ticket for X-B, I might get a Wait-listed
   ticket. Hence, I keep my existing Confirmed ticket and just change
   the Boarding point to X.