Yesterday Sue was walking along the road when she met James. He ......... (go) to the station to catch a train and he was carrying a bag. They stopped to talk for a few minutes.
Which one is correct , to say (was going) or (went) or both and why ?
"Was going," because, even though these sentences report something that happened in the past, when Sue meets James, as the first sentences tells, he has yet to arrive at the station. If he went to the station to catch a train, that would mean he went there, and presumably caught a train, before she met him. I don't think that's the intended meaning.
If, for some reason, it is, instead of "went," it should be "had gone."
He had gone to the station to catch a train.
We would want to know about his recent activities before Sue met him, and the past perfect conveys that much better than the simple past.