There are mainly two kinds of Neutral sections that have been used on IR.
1) On pure AC electrified sections, Neutral zones are short sections separating the OHE powered by two different substations.
Normally in the 3-phase electrification system, the OHE is powered by a single phase. Usually each substation powers a short section of the route. After this short distance, another substation will power the next section of OHE. Since both substations will be operating on separate phases, they cannot be connected electrically. So, at the...
more... end of the OHE section powered by one substation, there is a short section where the OHE is not electrically connected to any external power. After this short section, the next substation takes over. The region where the OHE is not powered is called a neutral section.
2) Another kind of neutral section, that was there around Bombay, but not present now is a AC-DC neutral section. The railway electrification in Bombay and around was DC based, while the rest of IR was on AC. So, at stations like Igatpuri, there was a short section of OHE, which could be powered by either AC or DC (through a control switch). Normally this OHE would be disconnected from the supply, but based on the requirement, it can be either DC or AC.
Normally, as long as OHE wire is present and is with the correct tension, the panto need not be lowered. However, to prevent sparks and voltage spikes, the panto is disconnected from the internal electrical components of the loco. Essentially the loco is 'switched off' while passing through this section. However, depending on OHE condition and caution orders, sometimes the panto may be lowered even if the OHE wire is present in the neutral section.