UNION OF INDIA AND ORS. vs SUGAULI SUGAR WORKS (P) LTD.

The Supreme Court determined that the sinking of the Barge was due to the serious negligence of Railway employees, not an 'inevitable accident', as established under Sections 83 and 84 of the Railways Act and Section 2 of the Indian Railways Board Act (4 of 1905). The Court held that the Railway, as a bailee, had the burden to prove due care, which it failed to do, leading to the affirmation of the High Court's decision to award interest on the decretal amount. The judgment clarified the admissibility of the Enquiry Committee's report under Sections 5, 7, and 9 of the Evidence Act, emphasizing the principle of compensation for pecuniary loss due to breach of contract.