STATE BANK OF INDIA Vs. NEW INDIA ASSURANCE COMPANY LIMITED
LAWS(SC)-2020-2-36
SUPREME COURT OF INDIA
Decided on February 07,2020

STATE BANK OF INDIA Appellant
VERSUS
NEW INDIA ASSURANCE COMPANY LIMITED Respondents

JUDGEMENT

DHANANJAYA Y.CHANDRACHUD,J. - (1.)Leave granted.
(2.)This appeal arises from a judgment and order of the National Consumer Disputes Redressal Commission, "NCDRC" in a first appeal from a judgment and order of the State Consumer Disputes Redressal Commission, Andhra Pradesh, "SCDRC".
(3.)On 14 November 2005, a loan agreement was entered into between the first appellant - State Bank of India, "Bank" and the second respondent "Borrower". Under the terms of the agreement, all the assets which were charged to the Bank were to be insured by the borrower. In pursuance of the loan agreement, an insurance cover was obtained by the Bank on behalf of the borrower in pursuance of an arrangement which it had with the insurer. A fire took place on the premises of the borrower on 15 February 2007. The insurer not having accepted the claim, the second respondent filed a consumer complaint before the SCDRC. By an order dated 17 November 2014, the SCDRC allowed the complaint in the following terms:
"In the result, the complaint is allowed. The opposite party no.1 and 2 are directed to forward the claim of the complainant to the opposite party no.3 and the opposite party no.3 to process the claim in accordance with law. The opposite party no.3 shall pay a sum of Rs.50,000/- towards compensation together with costs of Rs.7,000/-. Time for compliance four weeks."

Thus, by the above order of the SCDRC, the Bank was directed to forward the claim of the insured to the insurer. The insurer was, in turn, directed to process the claim in accordance with law. No liability to pay compensation was fastened on the Bank.

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