Concept of Estoppel is based on the maxim, alleganscontraria non estaudiendus(a person alleging contradictory facts should not be heard) and is that kind of proesumptio juris et de jure, where the fact presumed is taken to be true, not as against all the world, but as against a particular party, and that only by reason of some act done, it is in truth a kind of argumentum ad hominern.
The law for concept of estoppel is the rule of exclusion of certain evidence under certain circumstances, like between tenant and landlord, licensee or person in possession and licensor (S. 116), or as between acceptor and drawer of a bill of exchange, as between Bailee and bailor and licensor and license (S. 117). Estoppel is a procedure of ascertaining liability.
As per the stand was taken by Supreme Court in the case of Mohan v. State, the rule of issue estoppel does not prohibit that evidence given at one trial against the accused cannot be given in another trial for another offence. Thus where the acquittal order of a Magistrate on a minor offence was set aside and the accused committed for trial on a major offence, the principle of issue estoppel will not apply.
The principle of estoppel is recognized in India as a rule of evidence incorporated under the purview of Section 115 of The Indian Evidence Act, 1872. The section reads as follows:
“When one person has, by his declaration, act or omission, intentionally caused or permitted another person to believe such 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 that thing.”
In the landmark judgment of Ganges Mfg. Co. v. Sourujmull, the appellants, in this case, contended that sections from 115 to 117 as given in Chapter VIII of the Indian Evidence Act, 1872 lay down the only rules of estoppel which are now implemented under the force of law in the then existing India under the British rule. They further contended that by virtue of Section of the aforementioned Act, all rules, and doctrines of the Evidence Law shall be repealed except those that are in the Act itself. They held that the argument becomes an erroneous assumption that all rules of estoppel are also rules of evidence. But still, the Court recognized the principle of estoppel being a part of the Law of Evidence, by holding that “Where a man has made a representation to another of a particular fact or state of circumstances and has thereby wilfully induced that other to act upon that representation and to alter his own previous position, he is estopped as against that person from proving that the fact or state of circumstances was not true. In such a case the rule of estoppel becomes so far a rule of evidence, that evidence is not admissible to disprove the fact or state of circumstances which was represented to exist.”
Conditions for Estoppel
- Estoppels must be reciprocal or mutual. It must bind both parties to the litigation.
- Estoppels cannot circumvent the Law. Hence the contractual incapacity of a minor cannot be evaded by any estoppel against asserting his Infancy, even though he has obtained a loan by a false representation that he was an adult. And a tenant, who fails to raise a defense that his rent is in excess of the standard rent permitted by statute, is not estopped from making a subsequent application to determine the lawful rent.
- The statement that an estoppel must be clear, precise or unambiguous primarily refers to the representation on which an estoppel by conduct may be founded.
- Conflicting Estoppels cancel each other out.
- The doctrine of promissory estoppel is an equitable doctrine and the petitioners cannot ask the Court to apply the same to compel something which is inequitable, one who seeks equity must do equity. In our society, larger public must get precedence over individual interest or interest of a comparatively smaller section of society
Kinds of Estoppel
- Estoppel by record:
Under this kind of estoppel, a person is not permitted to dispute the facts upon which a judgment against him is based. It is dealt with by (i) Ss. 11 to 14 of the Code of Civil Procedure, and (ii) Ss. 40 to 44 of the Indian Evidence Act.
- Estoppel by deed:
Under this kind of estoppel, where a party has entered into a solemn engagement by deed as to certain facts, neither he nor anyone claiming through or under him, is permitted to deny such facts.
The Privy Council has held in PandurangKrishnaji v. MarkandeyaTukaram (40 I.A. 60), that the knowledge of the contents of the deed is not to be inferred from the mere fact of attestation.
- Estoppel by conduct:
Sometimes called estoppel in pais, may arise from agreement, misrepresentation, or negligence. The concept of Estoppel in pais is dealt with in Ss. 115 to 117. (Estoppel in pais means “estoppel in the country” or “estoppel before the public.”)
If a man, either by words or by conduct, has intimated that he consents to an act which has been done, and that he will not offer any opposition to it, although it could not have been lawfully done without his consent, and he thereby induces others to do that from which they otherwise might have abstained from doing, he cannot question the legality of the act to the prejudice of those who have so given faith to his words, or to the fair inference to be drawn from his conduct.
- Equitable Estoppel:
The Evidence Act is not exhaustive of the rules of estoppel. Thus, although S. 116 only deals with the concept of estoppel that arises against a tenant or licensee, a similar concept of estoppel have been held to arise against a mortgagee, an executor, a legatee, a trustee, or an assignee of property, precluding him from denying the title of the mortgagor, the testator, the author of the trust, or the assignor, as the case may be.
There are cases of estoppel which, though not within the terms of Ss. 115 to 117 of the Evidence Act, are recognized instances of estoppel. Estoppels which are not covered by the Evidence Act may be termed equitable estoppels.
- Estoppel by Negligence:
This type of estoppel enables a party, as against some other party, to claim a right of property which in fact he does not possess. Such estoppel is described as estoppel by negligence or by conduct or representation or by a holding out of ostensible authority. Such estoppel is based on the existence of a duty which the person stopped is owing to the person led into the wrong belief or to the general public of whom the person is one.
- Estoppel on benami transactions:
If the owner of property clothes a third person with the apparent ownership and a right of disposition thereof, not merely by transferring it to him, but also by acknowledging that the transferee has paid him the consideration for it, he is estopped from asserting his title as against a person to whom such third party has disposed of the property and who has taken it in good faith and for value.
- Estoppel on a point of law:
Concept of Estoppel refers to a belief in a fact, and not in a proposition of law. A person cannot be stopped for misrepresentation on a point of law. Admission on a point of law is not an admission of a “thing” so as to make the admission matter of estoppel. Where persons merely represent their conclusions of law as to the validity of an assumed or admitted adoption, there is no representation of a fact to constitute estoppel.
The Supreme Court has observed that the doctrine of estoppel does not operate where the mandatory conditions laid down by law on grounds of public policy are ignored. Thus, estoppel would not apply against a sanction obtained by fraud or by collusion between the parties.
Mohan v. State, AIR 1968 SC 1281.
Ganges Mfg. Co. v. Sourujmull, (1880) ILR 5 Cal 669.
Leslie Ltd. v. Sheill, (1914) 3 KB 607 (616) CA.
Li Tse Shi v Pong Tse Ching, A.I.R. 1935 P.C. 208.
S.В. Noronah v. Prem Kumari Khanna, (1980) 1 S.C.C. 52.