Numerous victims were dismembered beyond recognition and police said it would take several days to complete the identification of the dead.
Punjab Chief Minister Amarinder Singh ordered an investigation into the accident and announced a monetary compensation of 500,000 rupees ($6800) to each family of the victims.
Railway officials said no permission was sought from them either and ruled out an inquiry by the department into what they said was the worst accident due to "trespass" on railway tracks.
The Railways, while ruling out an inquiry into the mishap, has said it was not informed by the organisers or the local administration that a Dussehra event was being organised close to railway tracks.
Chairman Railway Board Ashwani Lohani said in a statement that the accident occurred at a midsection between the Amritsar and Manawala stations and not at a level crossing.
A state of mourning has been declared - offices and schools in Punjab will be closed on Saturday, Reuters reports.
In the death of 59 people in the Amritsar train tragedy on Friday evening, a bigger tragedy has struck many families: their sole breadwinners have died; and in several cases, children are still trying to find their parents.
Singh said only 25 bodies had been identified so far. There has been no action taken against the organizers yet.
The Chief Minister also directed that ration, clothing, and medicines be provided to the families of the victims expeditiously, as majority came from an economically weak background. Video clips posted on the social media showed some people who had apparently seen the approaching train tried to run away.
The disaster, near Amritsar in the north of the country on Friday, led to new demands for safety reforms to India's accident-plagued railway system, which records thousands of deaths each year.
Police are also making announcements on loudspeakers asking people to remain inside their houses.