1. In the suit which is the subject-matter of this appeal the plaintiff claimed damages for non-delivery of a hale of cloth despatched from Ahmadabad to Muzaffarpur railway station. The bale of cloth was not delivered by the defendant in spite of several demands made by the plaintiff and in spite of notices under Section 77 of the Indian Railways Act and Section 80 of the Code of Civil Procedure. The case of the defendant was that the suit was not maintainable because the plaintiff firm was not registered and Sec. 69 (2) of the Partnership Act was a bar. The defendant also denied liability to pay compensation as the loss of consignment was due to circumstances beyond the control of the defendant.

The trial court held that notices under Section 77 of the Indian Railways Act and Section 80 of the Code of Civil Procedure were properly served. The trial court also held that the plaintiff was entitled to compensation, and since there was no disclosure on behalf of the defendant there must be an inference of negligence and misconduct on the part of the railway. The trial court held that defendant No. 3, the Western Railway, and defendant No. 1, the Union of India, would be liable