1. The defendant in O. S. No. 69 of 1960 on the file of the Sub Court, Salem, is the appellant before us. The suit was filed by the plaintiffs, Sri Rajendra Mills Limited, Salem and the Eagle Star Insurance Company Limited, Bombay against the Union of India, representing Southern Railway and Central Railway for damages in a sum of Rs. 10,128/- being the loss suffered by them as a result of the damage to the first plaintiff's goods by fire. The facts which gave rise to the suit are not in dispute.
The first plaintiff was a consignee of 100 bales of pressed cotton from Messrs. Naran Das Rajaram (Private) Limited, Bombay. The bales were securely packed and delivered in good condition at Banosa in the Central Railway and were accepted for carriage at railway risk to be delivered to the plaintiff at Salem in Southern Railway, under invoice No. R. R. No. 9120/34 dated 2-3-1959. Out of the said consignment of 100 bales, 90 bales were loaded in one wagon and 10 bales were loaded in another. The wagon containing 90 bales arrived at Salem and the contents were found to be damaged by fire. The remaining 10 bales were however received later in good condition and accepted by the first plaintiff on 9-5-1959. As the first plaintiff refused to take delivery of the 90 bales, the railway authorities surveyed the goods on 9-5-1959 and found 21 bales were in good condition and the other 69 bales were damaged and they assessed the damage for, 23 bales at 22%; 30 bales at 30%; 16 bales at 40%. The plaintiff took delivery of the 21 bales which were in good condition and refused to take delivery of the damaged bales. Ultimately the damaged 69 bales were sold with a view to minimise the damages, through the intervention of the second plaintiff who are the insurers for the consignment for Rs. 21,000/-.

2. It was the plaintiff's case that the resulting loss caused to them by the fire was Rs. 14,105/-. that the damage was caused due to the acts of negligence, malfeasance and non - feasance on the part of the Railway administration during the transit of the goods and that though they are entitled to claim the said damage of Rs. 14,105/-, they are restricting their claim in the suit to Rs. 10,128/-being the damages at the percentage estimated by the Assistant Traffic Superintendent at the survey held on 9-5-1959.

3. The defendant admitted that 100 bales of pressed cotton were accepted for carriage from Banosa to Salem on 2-3-1959 and they were sent in two wagons as stated by the plaintiffs. As regards the consignment of 90 bales which was loaded in one wagon C. R. 4028 at Banosa station, the defendant pleaded that they were transhipped into P. R. C. 88933 at Murtazapur owing to break of guage on 5-3-1959, that it was received at Balharsha on 6-3-1959 and that soon thereafter the wagon was found on fire which was immediately extinguished with the help of water from the water hydrant nearby. According to them the fire was purely accidental and not due to any negligence or misconduct on the part of the railway administration or its servants. They stated that all care and caution required of the railway had been taken, that the cause of fire was not known, and that the fire was beyond the control of the railway authorities. The defendant repudiated the claim on the ground that the fire was purely accidental and not due to any misconduct or negligence either on the part of the railway administration or its servants.

4. The learned Subordinate Judge of Salem, who tried the suit, found that the goods were carried by the defendant at the risk of the railway and as such it was for the railway administration to show that the damage was caused not on account of any negligence or misconduct on the part of the railway administration or its servants. This finding that the goods were carried at the risk of the railway is not challenged before us. The learned Subordinate Judge, after considering the evidence, both oral and documentary, held that the damage was occasioned