- (1.) This is a suit for recovery of the sum of Rs. 6,236-0-3 from the Dominion of India as compensation for loss of goods despatched by rail. There is no dispute that the goods were sent from a railway station now situate within the territory of the Union of India, their destination being a place in Eastern pakistan. The Defendant disputes its liability to meet the Plaintiff's claim on various grounds.
(2.) A preliminary point was taken in defence as to whether the Defendant had any liability at all under the contract in suit. The relevant provision of law contained in Article 8 of the Indian Independence (Rights, Property and Liabilities) Order reads as follows: 8. (1) Any contract made on behalf of the Governor-General in Council before the appointed day shall, as from that day, (a) if the contract is for purposes which as from that day are exclusively purposes of the Dominion of Pakistan, be deemed to have been made on behalf of the Dominion of Pakistan instead of the Governor-General in Council; and (b) in any other case, be deemed to have been made on behalf of the Dominion of India instead of the Governor-General in Council; and all rights and liabilities which have accrued or may accrue under any such contract shall, to the extent to which they would have been rights or liabilities of the Governor-General in Council, be rights or liabilities of the Dominion of Pakistan or the Dominion of India, as the case may be.
(3.) It is now well settled that in order to find out which of the two dominions is liable, an artificial test has to be put, i.e., one must either consider the liability of the respective dominions treating both of them in existence at the time when the contract was made or in the alternative find out which of the two would be liable treating the contract as having been entered into, on August 15, 1947, when both the dominions had sprung into existence.;