Union of India V/S Udho Ram and Sons

FACTS

A Merchant consigned some goods to the respondent. At Howrah-Burdwan link the goods were
lost before reaching the destination. The respondent filed the suit against the railway authorities
for the loss caused. The trial court dismissed the suit on the ground that the railway authorities
took proper care of the goods but the reasons for the loss of goods were beyond the control of the
authorities.

The respondent appealed in High Court against this order and the High Court reversed this order
on the ground that there was no evidence proving the strength of the care taken by the railway
authorities in keeping an eye on the goods.

The present suit is the appeal of Union of India in the Supreme Court of India.

ISSUE

1. Whether the railway authorities were liable for the loss of the goods in transit?
2. Whether the railway authorities were in the position of the bailee and liable to indemnify for
the loss caused?

HOLDING
The Supreme Court of India opined that the high court in reversing the decision of the trial court
and considering the railway authorities as liable for the loss caused was justified.
RATIONALE
The railway authorities were liable to take proper care of the goods. They need to keep an eye on
the goods especially at the station where the train stops and protect the goods from theft. But
there was no such evidence which proves the strength of railway police to protect the goods.
Therefore, the railway authorities were liable and it was their negligence that goods lost in the
transit.

Concerning the second issue, the railway authorities were holding the goods as bailee and were
bound to take due care of the goods as an ordinarily prudent man would take in the same
situation and under the similar circumstances. Hence, the railway authorities were liable to
compensate the aggrieved for the loss caused to him due to their negligence