(1) M/S Indian Telephone Industries (ITI) (hereinafter referred to as the insured) purchased certain machinery from M/s Praga Tools Ltd. under the two invoices dated 31-3-1979 for their unit at Rae Bareli. The said consignment was insured with the plaintiff-respondent. The carrier of goods was the defendant-appellant. It appears that the consignment reached the destination in a badly damaged condition. Under such circumstances, the insured put up a claim for damages before the Insurance Company. After the inspection of machinery the Insurance Company settled the claim of the insured by paying Rs. 2,23,189.57. The respondent alleged that by virtue of having settled the claim, the insured subrogated its rights in favour of the respondent as per letter of subrogation dated 26-7-1981, Ex. P-9.

(2) ON the strength of the said letter the Insurance Company filed a suit against the defendant-appellant for recovery of Rs 1,88,305.97 with interest towards the damage caused to machinery in transit. In the said suit one of the additional issues framed was whether the suit at the instance of the plaintiff was maintainable. While deciding this issue the trial court came to the co