Case: Union Of India And Ors Vs. Sugauli Sugar Works (P) Ltd

of the barge and thereafter went away, leaving the matter entirely in the hands of the sarang. The High Court held that these officers were responsible for not staying on board until the barge was out of trouble.5. The High Court found that Barge No. 6 was very old. It was built in 1897. It underwent heavy repair s in 1953. The time of the accident was at about 2-20 p.m. on 7 September, 1955. "Samastipur" started towing the barge, went about a mile when the radius rod of Samastipur broke down. Radius rod is a part of the paddle by which a steamer is drive n. The radius rod of Samastipur was repaired in due course. It then heaved up its anchor. The anchor of the barge could not be lifted. There was a danger whistle. Rasul, the Sarang of "Chapra" came with his steamer to the aid of Samastipur. Two officers Lall and Devia herein before mentioned left the matter in the hands of the three sarangs. Lall, the Commander of the Ferry was not examined. The Assistant Mechanical Engineer was examined. The High Court found that Rasul did not take the steamer and the barge to the Diara but took them to Simarighat. The steamer and the barge reached jetty at Simariaghat. When the barge was about to be attached to the jetty, it sank.The High Court found that the strength of the current in the month of September was a known factor. The railway employees were used to ply the steamer and the barge between the two ghats during the month of September. The railway employees were found to equip themselves with appropriate appliances and necessary skill for the job of taking the barge across. The High Court found that there was no satisfactory explanation for the sinking of the barge. The High Court also found that there was no explanation why the anchor of the barge could not be lifted. According to the High Court, this might have been due to defective or insufficient appliance for haulage of the anchor. The High Court also found that there was no evidence to show that there was any unforeseen difficulty, b y reason of which the anchor could not be heaved up. The fact that the anchor could not be lifted was held by the High Court to be on account of the negligence of the railway employees.The High Court also referred to the fact that the barge developed a big hole and there was no explanation how this happened. The High Court felt that this could be explained by assuming that Chapra pulled the barge in such a way as to make the anchor chain rub against the bottom plates of the barge so a s to create the hole. The High Court found no other reasons because there is no suggestion that there was any submerged tree or stone, and the hole was caused because the barge accidentally struck against any such substance. Since the creation of the hole could not be attributed, according to the High Court to anything unforeseen, it was due to the negligence of the railway employees.The High Court further found that if the barge had been towed to the Diara, it could not sink. The water near the Diara must have been shallow so that the wagons upon the barge could not be submerged in the water near it. On the other hand, Rasul took the steamer and the barge to a much longer distance and the passage must have taken a considerable time. Besides, the water near the jetty was undoubtedly deep and the wagons were also submerged.The High Court on these findings correctly came to the conclusion that the barge sank because of the serious negligence of the railway employees and the railways did not take the care which it was required to take as a bailee.The High Court passed decrees awarding the respondents price of sugar and costs of damages and interest pendente lite and future interest.6. The appellant contended that the contract price should not have been awarded. The High Court said that the evidence of plaintiffs witness Gaya Prasad showed the selling rate of sugar and there was no challenge to that evidence. The High Court found that the goods were despatched on 4 September, 1955. The barge sank on 7th September, 1955, and, therefore, the contract price would be the correct measure of damages. The High Court on the facts and circumstances of the case found that the contract price would also be the same as the market price at that time.7. The market rate is a presumptive test because it is the general intention of the law that, in giving damage for breach of contract, the party complaining should, so far as it can be done by money, be placed in the same position as he would have been in if the contract had been performed. The rule as to market price is intended to secure only an indemnity to the purchaser. The market value is taken because it is presumed to be the true value of the goods to the purchaser. One of the principles for award of damages is that as far as possible he who has proved a breach of a bargain to supply what he has contracted to get is to be placed as far as money can do it, in as good a situation as if the contract had been performed. The fundamental basis thus is compensation for the pecuniary loss which naturally flows from the breach. Therefore, the principle is that as far as possible the injured party should be placed in as good a situation as if the contract had been performed. In other words, it is to provide Compensation for pecuniary loss which naturally flows from the breach. The High Court correctly applied these principles and ad opted the contract price in the facts and circumstances of the case as the correct basis for compensation.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]The High Court said that the evidence of plaintiffs witness Gaya Prasad showed the selling rate of sugar and there was no challenge to that evidence. The High Court found that the goods were despatched on 4 September, 1955. The barge sank on 7th September, 1955, and, therefore, the contract price would be the correct measure of damages. The High Court on the facts and circumstances of the case found that the contract price would also be the same as the market price at thatmarket rate is a presumptive test because it is the general intention of the law that, in giving damage for breach of contract, the party complaining should, so far as it can be done by money, be placed in the same position as he would have been in if the contract had been performed. The rule as to market price is intended to secure only an indemnity to the purchaser. The market value is taken because it is presumed to be the true value of the goods to the purchaser. One of the principles for award of damages is that as far as possible he who has proved a breach of a bargain to supply what he has contracted to get is to be placed as far as money can do it, in as good a situation as if the contract had been performed. The fundamental basis thus is compensation for the pecuniary loss which naturally flows from the breach. Therefore, the principle is that as far as possible the injured party should be placed in as good a situation as if the contract had been performed. In other words, it is to provide Compensation for pecuniary loss which naturally flows from the breach. The High Court correctly applied these principles and ad opted the contract price in the facts and circumstances of the case as the correct basis for compensation.