PROJECT TITLE: APPLICABILITY OF DOCTRINE OF ESTOPPEL IN

ADMINISTRATIVE ACTIONS

SUBJECT: ADMINISTRATIVE LAW

NAME OF THE FACULTY: DR. P. SRI DEVI

SUBMITTED BY: CHANDRIKA CHOUDHARY

ROLL NO.: 2013038

SEMESTER: 6TH SEMESTER

MARCH 2016

ACKNOWLEDGEMENT

I would like to express my special thanks of gratitude to my teacher DR. P. SRI

DEVI, who gave me the golden opportunity to do this project on APPLICABILITY
OF DOCTRINE OF ESTOPPEL IN ADMINISTRATIVE ACTIONS, which also
helped me in doing a lot of research and I came to know about so many new things I
am really thankful to them.
Secondly I would also like to thank my parents and friends who helped me a lot in
finalizing this project within the limited frame. I want to convey a most sincere thanks
to my concerned faculty for helping me throughout the project without whose
exorbitant support this project would not have become a reality.

ABSTRACT

In, law estoppel is a set of doctrines in which a court prevents a litigant from taking an action the
litigant normally would have the right to take, in order to prevent an inequitable result. Estoppel
occurs when a party, reasonably relies on the promise of another party, and because of the
reliance is injured or damaged. For example, estoppel precludes a person from denying, or
asserting anything to the contrary of, that which has, in contemplation of law, been established as
the truth, either by the acts of judicial or legislative officers, or by his own deed, acts or
representations, either express or implied.
The doctrine of estoppel is well accepted in administrative law and constitutional law. It has been
accepted in various legal systems. It is called promissory estoppel, equitable estoppel,
quasi-estoppel or new estoppel. It is a principle evolved by importing equity into law.
Estoppel is a rule of equity to prevent a person taking advantage of a situation when, with the
knowledge of facts, he has so conducted himself so as to lead the other party to believe that he
would not do as he did. It is thus an appeal to conscience of court and avoids injustice. Estoppel
does not allow a party to say that a certain statement of fact was untrue, even if in face, it was
untrue.
The researcher in this project will be dealing with both the traditional view and modern view of
doctrine of estoppel. The researcher will also deal with the topic that how the doctrine of
estoppel cannot be extended or applied if a promise is obtained by playing fraud on the
Constitution. The researcher will also cite case laws to explain the topic more clearly.

TABLE OF CONTENTS

Acknowledgement.
Abstract..
Abbreviations Used
Meaning of Estoppel..
Estoppel- As a rule of Evidence.
Evolution of Doctrine of Promissory Estoppel..
Promissory Estoppel- An Outline..
Nature of Promissory Estoppel..
Application of Doctrine of Promissory Estoppel to Government..
Estoppel against a Statute..
Conclusion.
Bibliography..
Webliography.

ABBREVIATIONS USED

Abbreviation Used

Used in Place of

AC

Appeal Cases (Law Reporter)

AIR

All India Reporter

All ER

All England Reporter

BA

Bachelor of Arts

Ch.

Chancery

CLR.

Commonwealth Law Reports

Del.

Delhi High Court

Ed.

Edition

Ibid

Ibidem

J.

Justice

KB

Kings Bench

Ltd.

Limited

p.

Page Number

SC

Supreme Court of India

SCC

Supreme Court Cases

SCR

Supreme Court Reporter

v.

Versus

MEANING OF ESTOPPEL

Estoppel in simple words is a bar which prevents a party from asserting a fact or
putting up claim inconsistent with the position he previously took. It is said to be a
rule which preludes a person from saying one thing at one time and another thing,
totally inconsistent with the earlier one, at another stage.1
In Blacks new Dictionary, estoppel is indicated to mean that a party is prevented
by his own acts from claiming a right to the detriment of other party who was entitled
to rely on such conduct and has acted accordingly.2
According to Oxford Dictionary of Law estoppel is a rule of evidence or a rule of
law that prevents a person from denying the truth of a statement he has made or from
denying facts that he has alleged to exist. The denial must have been acted upon
(probably to his disadvantage) by the person who wishes to take advantage of the
estoppel or his position must have been altered as a result.3
When a person has, by his declaration, act or omission, intentionally caused or
permitted another person to believe a thing to be true, and to act upon such belief,
neither he nor his representative shall be allowed in any suit or proceeding between
himself and such person or his representative, to deny the truth of the thing. The
former person is thus estopped from denying the truth of his previous statement. He
thus cannot both approbate and reprobate, because of invocation of rule of estoppel
against him.4
In other words, estoppel is a rule, whereby a party is precluded from or to say
estopped from denying the existence of some state of facts which he had previously
asserted and on which the other party has relied or is entitled to rely upon.
According to Wade and Forsyth the basic principle of estoppel is that a person who by
some statement or representation or representation of face causes the other to act to
his determent in reliance on the truth of it is not allowed to deny it later, even though
it is wrong. Estoppel, thus gives way to justice to prevail over the truth.5
In Indira Bai v. Nand Kishore,6 Sahai, J., stated Estoppel is a rule of equity flowing
out of fairness striking on behaviour deficient in good faith. It operates as a check on
1

Kumar, Narender; Nature and Concepts of Administrative Law, 1st Ed., Allahabad Law Agency,
Faridabad, 2011, p.366.
2
Quoted in Sharma Transport v. Government of Andhra Pradesh, AIR 2002 SC 322.
3
A Dictionary of Law, 5th Ed., Oxford University Press, New York, 2003, p. 95
4
Kumar, Narender; Nature and Concepts of Administrative Law, 1st Ed., Allahabad Law Agency,
Faridabad, 2011, p.366.
5

Wade, H.W.R. & Forsyth, C.F.; Administrative Law, 9th Ed., Oxford University Press, New Delhi,
2006, p.237
6
(1990) 4 SCC 668 (670).

spurious conducting by preventing the inducer from taking advantage and assailing
forfeiture already accomplished. It is invoked and applied to aid the law in
administrative of justice. Nut for it great many injustices may have been perpetrated.
ESTOPPEL- AS A RULE OF EVIDENCE
Estoppel, as a rule of evidence, may be read in distinction to equitable principle of
promissory estoppel. While the former is more correctly described as a principle of
law.7 The later is known as a rule of equity. As a principle of law estoppel applies
only to representations about past or present fact.8
The basic premise of estoppel is that a person, who by some statement or
representation of facts causes another act in reliance on the truth of it, is not allowed
to deny it later, even though it is wrong.9
The principle of estoppel embodies in Section 115 of the Indian Evidence Act, 1872 is
commonly known as a rule of evidence. The Section reads as Under:
When one person has by his declaration, act or omission intentionally caused or
permitted another person to believe a thing to be true and to act on such belief, neither
he nor his representatives shall be allowed in any suit or proceeding between himself
and such person or his representatives, to deny the truth of that thing.
To invoke the principle of estoppel enshrined in the Section, the following three
conditions are necessarily be satisfied:
i. There must be a declaration, act or omission on the part of a person;
ii. By the said declaration, etc., that person must have intentionally caused or
permitted another person to believe a thing to be true; and
iii. He must have intentionally caused or permitted the said another person, to act
upon such belief.
Section 115 explains that a party is precluded from denying the existence of some
state of facts which he had previously asserted and on which the other party has relied

Canada & Dominion Sugar Co. Ltd. V. Canadian National (West Indies) Steamships Ltd.,
(1947) AC 46.
8
Wade, H.W.R. & Forsyth, C.F.; Administrative Law, 9th Ed., Oxford University Press, New Delhi,
2006, p.236
9

Ibid

or is entitled to rely on. That, a man should keep his words, all the more so when the
promise is made with the intention that the party should act upon it.10
As a rule of Evidence, embodied in Section 115, estoppel may lie against the
Government on a representation or statement of facts, if the statement does not
operate against the statute.
In Delhi University v. Ashok Kumar,11 the respondent, a student after passing the
Secondary School Certificate Examination of the Gujarat Board was admitted
provisionally in the B.A. I year course in Delhi University. After over a year, the
University informed him that he was ineligible to join the course because the Gujarat
Board Examination had been recognised by the appellate University as equivalent to
Metric Examination while the qualification to join B.A. I year Course was passing the
Higher Secondary Examination. However, the statute had authorised the Academic
Council of the University to grant exemption from the admission requirements. The
High Court of accepted the plea of the estoppel raised by the student against the
University.
The court stated that estoppel was within the meaning of Section 115 of the Evidence
Act, 1872, might arise from the silence as well as words, the Court held in action of
the University for over a year amounted to a representation by it that it had approved
his admission and therefore the University would now be estopped from doing that.
In Shri Krishna v. Kurukshetra University,12 the Apex court had ruled that the
University could not cancel the candidature of the appellant - student for the not
complying with the attendance requirement, as the respondents failed to tale the
adequate care to scrutinize his examination from at the relevant time to ascertain
whether the candidate fulfilled the necessary conditions.

EVOLUTION OF DOCTRINE OF PROMISSORY ESTOPPEL

10

Kumar, Narender; Nature and Concepts of Administrative Law, 1st Ed., Allahabad Law Agency,
Faridabad, 2011, p.368.
11
12

AIR 1968, Del. 131.

AIR 1976 SC 376.

Promissory estoppel is a relatively new development. In order to trace the evolution of

the doctrine in England, we need to refer to some of the English decisions. The early
cases did not speak of this doctrine as estoppel they spoke of it as raising equity.
Lord Cairns stated the doctrine in its earliest form in the following words in Hughes
v. Metropolitan Railway Company.13
It is the first principle upon which all courts of equity proceed, that if parties who
have entered into definite and distinct terms involving certain legal results afterwards
by their own act or with their won consent enter upon a course of negotiation which
has the effect of leading one of the parties to suppose that the strict rights arising
under the contract will not be enforced, or will be kept in suspense, or held in
abeyance, the person who otherwise might have enforced those rights will not be
allowed to enforce them where it would be inequitable having regard to the dealings
which have thus taken place between the parties.
This principle of equity made sporadic appearances but it was only in 1947 that it was
restated as recognized doctrine by Lord Denning in Central London Properties
Trust Ltd. v. High Trees House Ltd.,14 who asserted15 :
A promise intended to be binding, intended to be acted upon, and in fact acted upon
is binding.
In the formative period the doctrine of promissory estoppel could not be invoked by
the promisee unless he had suffered detriment or prejudice. All that is required is
that the party asserting the estoppel must have acted upon the assurance given by him.
The alteration of position by the party is the only indispensable requirement of the
doctrine.
In India, there are two stages in the evolution of the application of this doctrine; pre
Anglo Afghan case and post- Anglo Afghan case. Prior to this case, the position was
that promissory estoppel did not apply against the Government. But the position
altered with this case.
In Union of India v. Indo Anglo Afghan Agencies Ltd.,16 the Government of India
announced certain concessions with regard to the import of certain raw materials in
13

(1877) 2 AC 439.
(1947) KB 130.
15
Infra 17
16
AIR 1968 SC 718
14

order to encourage export of woollen garments to Afghanistan. Subsequently, only

partial concessions and not full concessions were extended as announced. The
Supreme Court held that the Government was estopped by its promise. Thereafter the
courts have applied the doctrine of promissory estoppel even against the Government.
PROMISSORY ESTOPPEL: AN OUTLINE
Lord Denning in Central London Property Trust Ltd. v. High Trees House Ltd., 17
expressing the doctrine stated:18
Once a promise has been made by a person knowing that it would be acted upon by
the person to whom it is made and in face it is not acted upon, then it is inequitable to
allow the party making the promise to go back upon it.
In this case, during the Second World War, people left London owning to
bombardment and as a result, a number of flats remained unoccupied. A had left out
his flat to B for 99 years at the rate of 2500 Lakh a year. He however, due to ear
conditions, agreed to reduce the rent by fifty per cent. After the war was over, the
tenants returned. A demanded full amount of rent to which B objected relying on As
assurance. The Court applied the doctrine of estoppel and granted relief to B.
The Doctrine of Promissory Estoppel is premised to be conduct of a party making a
representation to the other so as to enable him to arrange its affairs in such a manner
as if the said representation is acted upon.19
In Sharma Transport v. Government of Andhra Pradesh, 20 Promissory Estoppel
was defined as:
an estoppel which arises when there is a promise which promisor should reasonably
except to induce action or forbearance of a definite and substantial character on the
part of the promise and which does induce be avoided only by enforcement of
promise.
the principle of promissory estoppel is that where one party has by his words or
conduct made to the other a clear and unequivocal promise or representation which is
17

(1947) 1 KB 130
Supra 14
19
L.M.T. Limited v. State of Uttar Pradesh, AIR 2008 SC 1032.
20
AIR 2002 SC 322.
18

intended to create legal relations or affect a legal relationship to arise in the future,
knowing or intending that it would be acted upon by the other party, the promise or
representation would be binding on the party making it and he would not be entitled
to go back upon it, if it would be inequitable to allow him to do so, having regard to
the dealings which have taken place between the parties.
Dixon, J., an Australian Jurist in Grundt v. The Great Boulder Proprietary Gold
Miners Ltd.,21 explained:
It is often said that the party asserting the estoppel must have been inducted to act to
his detriment. Although substantially such a statement is correct and leads to no
misunderstanding, it does not bring out clearly the basal purpose of the doctrine. That
purpose is to avoid or prevent a determent to the party asserting the estoppel by
compelling the opposite party to adhere to the assumption upon which the former
acted or abstained from acting. This means that the real detriment or harm from which
the law seeks to give protection is that which would flow from the change of position
if the assumptions were deserted that led to it.
Sahai, J., explaining the basis of the doctrine in Indira Bai v. Nand Kishore,22
observed Estoppel is a rule of equity flowing out of fairness striking on behaviour
deficient in good faith. It operates as a check on the spurious conducting by
preventing the intruder from taking advantage and assailing forfeiture already
accomplished. It is invoked and applied to aid the law in administration of justice. But
for it, great many injustices may have been perpetrated.

NATURE OF PROMISSORY ESTOPPEL

21
22

(1938) 59 CLR 641.

(1990) 4 SCC 668.

It has been said that the rule of promissory estoppel cannot itself be the basis of an
action. It cannot be a cause of action; it can only be shield and not a sword. Since the
doctrine has been usually invoked by way of defence, it has come to be identified as a
measure of defence.23
But in the present day judicial tendency appears to be that estoppel can be used as a
sword also.24 Stating that there are estoppels and estoppels Lord Denning held that
some do give rise to cause of action, some do not. In the species of estoppel called
proprietary estoppel, says the learned Lord it does give rise to cause of action.25
Estoppel is often described as a rule of evidence, but the whole concept is more
correctly viewed as a substantive rule of law. It is necessary to make it clear that the
doctrine of promissory estoppel or equitable estoppel is not based on the principle of
estoppel but it is a doctrine evolved by equity in order to prevent injustice. Estoppel
by conduct proceeds on the rule of substantive law and equity where a promise made
by a person knowing that it would be acted on by the person to whom it is made and
in fact it is so acted and it is inequitable to allow the party making the promise to go
back upon it.26
It being an equitable principle evolved for doing justice, there is no reason, said
Bhagwati, J., why it should be given only limited application by way of defence. It
can be the basis of cause of action.27
Though commonly named as promissory estoppel, it is neither in the realm
of contract nor in the realm of estoppel. The basis of the doctrine is the interposition
of equity which has always, true to its form, stepped in to mitigate the rigour of strict
law.28

APPLICATION OD DOCTRINE OF PROMISSORY ESTOPPEL TO

GOVERNMENT
23

Motilal Padampat Sugar Mills v. State of Uttar Pradesh, AIR 1979 SC 621.
Moorgate Mercantile Company v. Twichings, (1975) 3 AII ER 314.
25
Crabb v. Arun DC (1976) Ch. 179.
26
Halsburys Laws of England, XV, 168., Cited in Kumar Narender, Nature and Concepts
of
Administrative Law,
1st Ed., Allahabad Law Agency, Faridabad, 2011, p.371.
27
Supra 24
28
Wade, H.W.R. & Forsyth, C.F.; Administrative Law, 9th Ed., Oxford University Press, New Delhi,
2006, p.236
24

Since the doctrine of promissory estoppel is an equitable doctrine it must yield when
the equity so requires. If it can be shown by the Government that having regard to the
facts as they have subsequently transpired, it would be inequitable to the Government
to abide by the promise made by it, the court would not raise equity in favour of the
promise and enforce it against the Government. When the Government is able to show
that due to the facts which have transpired subsequent to the promise being made,
public interest would be prejudiced if the Government were required to carry out the
promise made, the court would have to balance the public interest in the Government
carrying out the promise made to a citizen which has induced the citizen to alter his
position to his prejudice and the public interest likely to suffer if the Government
were to carry out the promise, and determine which way the equity lies.
The case of Motilal Padampat Sugar Mills v. State of Uttar Pradesh29 is a
trendsetter regarding the application of the doctrine of promissory estoppel against the
Government. In this case the Chief Secretary of the Government gave a categorical
assurance that total exemption from sales tax would be given for three years to all
new industrial units in order them to establish themselves firmly. Acting on this
assurance the appellant sugar mills set up a hydrogenation plant by raising a huge
loan. Subsequently, the Government changed its policy and announced that sales tax
exemption will be given at varying rates over three years. The appellant contended
that they set up the plant and raised huge loans only due to the assurance given by the
Government. The Supreme Court held that the Government was bound by its promise
and was liable to exempt the appellants from sales tax for a period of three years
commencing from the date of production.
In Century Spinning and Manufacturing Co. v. Ulhasnagar Municipality,30 the
municipality agreed to exempt certain existent industrial concerns in the area from
octroi duty for a period of seven years. However, later on it sought to impose duty.
This was challenged and the Supreme Court, while remanding the case to the High
Court, held that where the private party had acted upon the representation of a public
authority, it could be enforced against the authority on the grounds of equity in
29
30

AIR 1979 SC 621

AIR 1971 SC 1021: 1970 SCR (2) 854

appropriate cases even though the representation did not result in a contract owing to
the lack of proper form.
However the case of Jit Ram Shiv Kumar v. State of Haryana, 31 cast a shadow on
the Motilal case where it was held that the doctrine of promissory estoppel is not
available against the exercise of executive functions of the State. The Supreme Court
in Union of India v. Godfrey Phillips India Ltd., 32 soon removed this doubt. The
court held that the law laid down in Motilal Case represents the correct law on
promissory estoppel.
In State of Punjab v. Nestle India Ltd.,33 The Apex Court said:
Promissory estoppel long recognised as a legitimate defence in equity was held to
find cause of action against the Government, even when, and this needs to be
emphasized, the representation sought to be enforced was legally invalid in the sense
that it was made in a manner which was not in conformity with the procedure
prescribed by the statute.
It has also been made clear that the Government could not, on some undefined and
undisclosed ground of necessity or expediency fail to carry out the promise solemnly
made by it. Nor, the Government could claim to be the Judge of its own obligation to
the citizen on an ex parte appraisement of the circumstances in which the obligation
had arisen.34
The doctrine of estoppel cannot be invoked for preventing the Government from
acting in discharge of its duties under the law. The doctrine of cannot be applied in
teeth of an obligation or liability imposed by the law. It cannot be used to compel the
Government or even a private party to do an act prohibited by law. There can be no
promissory estoppel against the exercise of legislative power. The legislature can
never be precluded from exercising its legislative functions by resort to the doctrine of
promissory estoppel.35
ESTOPPEL AGAINST A STATUTE
31

AIR 1980 SC 1285: 1980 SCR (3) 689: SCC (1) 11.
1996 (85) ELT 242 Bom.
33
AIR 2004 SC 4559.
34
Union of India v. Indo Afghan Agencies Ltd., AIR 1968 SC 718.
35
Kumar Narender, Nature and Concepts of Administrative Law, 1st Ed., Allahabad Law Agency,
Faridabad, 2011, p.381.
32

The doctrine of estoppel does not apply to statutes. In other words, a person who
makes a statement as to the existence of the provisions of a statute is not estopped,
subsequently, from contending that the statutory provision is different from what he
has previously stated. A person may not represent the true status of a statute or law,
but the other person who relies on such a representation is at liberty to find out the
position of law on the matter and as the maxim says, ignorance of law is no excuse.36
In Jit Ram Shiv Kumar v. State of Haryana,37 a municipality granted exemption
from octroi for developing a mandi, but subsequently is revoked the exemption. Later
it again granted the exemption in keeping with the terms of the original sale of plots,
but levied taxes again. Even so, a claim of estoppel against its legislative power was
not allowed.
So is the case with the tax laws. If the law requires that a certain tax be collected, it
cannot be given up, and any assurances by the Government that the taxes would not
be collected would not bind the Government, when it chooses to collect the taxes.
Thus it was held that when there was a clear and unambiguous provision of law that
entitles the plaintiff to a relief, no question of estoppel arises.
The following conditions have been laid down as necessary to invoke no estoppel
against a statute:

The parties must bilaterally agree to contract irrespective of statutory

provisions of the applicable Act.

The agreement entered into by the parties must be expressly prohibited by the
Act.

The provision of law must be made for public interest and not pertain to a
particular class of persons.

The agreement of the parties should not have been merged into an order of the
court which by the conduct of the parties had been dissuaded from performing
its statutory obligations.

36
37

Upadhyaya, Dr. J.J.R.; Administrative Law, 7th Ed., Central Law Agency, Allahabad, 2011, p.333.
AIR 1980 SC 1285 : 1980 SCR(3) 689 : 1981 SCC (1) 11

So, it is a well catena of decisions that a doctrine of Promissory Estoppel cannot be

invoked against the provisions of the Statutes.38

CONCLUSION
The Doctrine of Estoppel is necessary to maintain flexibility in the law of the land.
The Government and other parties are kept under check from making promises for
which they can be held accountable as discussed before. It is inequitable that
the promisor should be allowed to resize from the assurance or representation having
38

Vasant Kumar Radhakrishan Vora v. Board of Trustees, Port of Bombay, AIR 1991 SC 14;
Amit Banaspati Co. Ltd. v. State of Punjab, AIR 1992 SC 1075.

regard to what the promisee has done or refrained from doing in reliance on the
assurance or representation. So the citizens can rest assured about the lawful promises
made.

BIBILIOGRAPHY

A Dictionary of Law, 5th Ed., Oxford University Press, New York, 2003.

Jain, M.P. & Jain, S.N.; Principles of Administrative Law, 6th Ed., Vol. II,
Wadhwa Nagpur, 2007.

Kumar, Narender; Nature and Concepts of Administrative Law, 1st Ed.,

Allahabad Law Agency, Faridabad, 2011.

The Indian Evidence Act, 1872.

Upadhyaya, Dr. J.J.R.; Administrative Law, 7th Ed., Central Law Agency,
Allahabad, 2011.

Wade, H.W.R. & Forsyth, C.F.; Administrative Law, 9th Ed., Oxford University
Press, New Delhi, 2006.
WEBLIOGRAPHY

http://en.wikipedia.org/wiki/Case_citation

http://hanumant.com/index.php/articles/general-articles/41-promissoryestoppel-application-to-the-govt-by-divya-bhargava.html

http://www.indiankanoon.org/

http://www.legalserviceindia.com/article/l249-Promissory-Estoppel.html