N.R. SRINIVASA IYER vs NEW INDIA ASSURANCE co., LTD.

The Supreme Court held that under the Contract Act, the insurer became a bailee of the motor car when it was entrusted to the repairer, who acted as a sub-bailee. The Court found that the insurer had mutual rights and obligations with the insured, including the duty to reimburse repair costs and the option to repair or replace the vehicle. The High Court's dismissal of the suit was overturned, affirming that the insurer's responsibilities included ensuring the car's safety while in the repairer's custody.