Chief Manager, Central Bank of India and Another vs Sandhya Sah and Others

A petition was brought by a person who held a credit card (his widow received rights under an insurance policy) that the facility of a cash credit limit on the credit card had an additional benefit of a life insurance policy. The coverage was for Rs. 10,00,000 (ten lakhs). It is accepted between the parties that the payment of Rs. 10,00,000 (ten lakhs) was automatic on the death of the person who held the credit card.

2.There is no issue that whether between the bank that is the Central Bank of India and the insurance company, that is, the New India Assurance Company there was a delay in processing the disbursement on the insurance policy which was guaranteed against the credit card. The delay was substantial.

In so far as what happened is a logical follow up of delayed money payment. The bank has been required to pay the interest on an amount which was admittedly delayed.

The issues were brought by the person who was entitled to the benefits of the insurance policy that is Sandhya Sah, the widow of the person who held the credit card. The petition was allowed. The payment was directed to be made. The interest on the delayed payment was not to be withheld and was required to be paid by the bank. The issues between the bank and the insurance company were left open.

The court does not find any error in this order. If the bank feels, as the learned judge has suggested in his order, that between the bank and the insurance company they can sort out their matters as they may be advised.