Doctrine of Estoppel: Section 115 Evidence Act & BSA 2023

Estoppel under the Indian Evidence Act and the Bharatiya Sakshya Adhiniyam

The Meaning and Etymology

The word "estoppel" is derived from the French estoupail or estoup, meaning a stopper or plugger — and that, in essence, is precisely what the doctrine does: it stops a person's mouth. Lord Coke explained it memorably when he wrote that "a man's own act or acceptance stoppeth or closeth up his mouth to allege or plead the truth." The doctrine rests on the ancient Latin maxim allegans contraria non audiendus est — a person who alleges contradictory facts shall not be heard.

In its simplest formulation, estoppel is a rule of law by which a person who has made a representation to another, upon which that other has acted to his detriment, is thereafter precluded from denying the truth of what he represented. The principle flows from the bedrock of equity and good conscience: a party cannot, with any fairness, say one thing at one moment and the precise opposite at the next, when another has rearranged his affairs in reliance on the first statement.

The Statutory Text

Section 115 of the Indian Evidence Act, 1872 — now reproduced almost verbatim as Section 121 of the Bharatiya Sakshya Adhiniyam, 2023 (BSA) — states:

"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 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."

The Illustration appended to the section brings the principle to life with memorable clarity: A intentionally and falsely leads B to believe that certain land belongs to A, and thereby induces B to buy and pay for it. The land afterwards becomes the property of A, and A seeks to set aside the sale on the ground that at the time of the sale he had no title. He must not be allowed to prove his want of title. This illustration also embodies the allied doctrine of "feeding the grant by estoppel," mirrored in Section 43 of the Transfer of Property Act, 1882 — where a person who fraudulently or erroneously represents authority to transfer property is bound to make good that transfer if he subsequently acquires the interest.

The Rationale of the Doctrine

The juridical underpinning of estoppel is variously described as the principle of reliance on pledged word, the maxim venire contra proprium actum (one shall not go against one's own act), and the equitable notion that a person cannot "blow hot and cold." Sir Frederick Pollock, with characteristic elegance, called estoppel "the most powerful and flexible instrument to be found in any system of Court jurisprudence." The essence of the doctrine is not merely unfairness in the making of the representation, but the injustice that flows from allowing a party to resile from it after the other has fundamentally altered his position in reliance upon it.

The Kinds of Estoppel

Chief Justice Coke classified estoppel into three broad kinds, and the classification has endured across centuries.

Estoppel by Record

Estoppel by record arises from a judgment of a court of competent jurisdiction. When a matter has been finally adjudicated between parties, neither of them can re-open or dispute that decision. This form of estoppel is the foundation of res judicata and is primarily governed by Sections 11–14 of the Code of Civil Procedure, 1908, and Sections 40–44 of the Indian Evidence Act (Sections 34–38 of the BSA, 2023). It is the final decision — and not every passing observation in a judgment — that creates this estoppel. The principle extends to criminal proceedings as well. In the famous American decision of Ashe v. Swenson, the Supreme Court held that "collateral estoppel" — meaning that when an issue of ultimate fact has once been determined by a valid and final judgment, that issue cannot be re-litigated between the same parties — is part of the constitutional guarantee against double jeopardy.

Estoppel by Deed

Where parties enter into a solemn engagement by deed and state certain facts in it, neither of them, nor those claiming through them, can be permitted to deny those facts in any action on the deed. However, this rule is qualified: no estoppel arises upon recitals that are immaterial or not intended to bind, and a deed tainted by fraud or illegality cannot operate as an estoppel. It is noteworthy that Indian courts have been reluctant to apply the English doctrine of estoppel by deed in its rigid form; justice in India, as more than one High Court has observed, is better served by allowing any party to show the truth rather than be bound by a mere technical form of conveyancing.

Estoppel in Pais or by Conduct

In pais means "in the country" or "before the public," and estoppel in pais is what most people understand as the ordinary, everyday working of the doctrine — estoppel arising from conduct outside any record or deed. The classic formulation is attributed to Lord Denman CJ in Pickard v. Sears (1837): "Where one by his words or conduct wilfully causes another to believe in the existence of a certain state of things, and induces him to act on that belief, or to alter his previous position, the former is precluded from averring against the latter a different state of things." This is precisely what Section 115 of the Indian Evidence Act codifies. The conduct that can found such an estoppel is wide-ranging: it covers not only positive statements and overt acts, but also silence in circumstances where one was duty-bound to speak, acquiescence, connivance, and even negligence.

The Essential Elements of Section 115 (Section 121 BSA)

For the doctrine under Section 115 to operate, the following ingredients must be established:

A declaration, act, or omission by one person — The foundation must be a statement, an act, or even a deliberate silence in circumstances where the person was expected to speak. In Sarat Chander Dey v. Gopal Chander Laha (1892), the Privy Council held that a son who had allowed his widowed mother to hold and mortgage property as though she were the sole owner, and had actively acted on her behalf in executing the mortgage, was estopped from asserting his separate title against the mortgagee — because his conduct amounted to a representation of ownership.
The representation must be intentional — Section 115 requires that the person making the statement must have intentionally caused another to believe it. The word "intentionally" in this context, as Lord Denman explained in Pickard v. Sears, means wilfully — it refers to the inducement, not merely the act of stating. The section does not, however, require that the statement be made with a fraudulent motive; even an ignorant representation can found an estoppel if made deliberately.
The other person must believe the representation to be true and act upon it — There must be actual reliance. A representation made to someone who does not believe it, or who knows the truth, cannot create an estoppel. Likewise, no estoppel arises where both parties had equal knowledge of the true state of facts.
The representee must have altered his position — The person to whom the representation was made must have acted upon the belief and changed his position. This is the heart of the doctrine. In the leading Supreme Court case of Motilal Padampat Sugar Mills v. State of Uttar Pradesh (AIR 1979 SC 621), the Court held that it was enough that the Mills had altered their prior position and made investments which they would not otherwise have made, in reliance on the Government's representation of tax exemption.
Detriment — Though Section 115 does not expressly mention detriment as a condition, the general principle flowing from equity is that the representee must have suffered some injury, harm, loss, or deprivation consequent upon acting on the belief. However, the Supreme Court in Motilal Padampat Sugar Mills made it clear that alteration of position was the real test, and detriment, where it also occurs, would additionally provide the contractual consideration that makes the promise actionable as a cause of action.

Estoppel by Negligence

A significant extension of the doctrine is estoppel arising from negligence — where a party's careless conduct, rather than any positive act, creates a misleading impression. The Privy Council examined this in Mercantile Bank of India Ltd. v. Central Bank of India Ltd., where merchants pledged railway receipts with two banks by fraud, and the first bank had failed to stamp the receipts to indicate the earlier pledge. The Privy Council held that for negligence to found an estoppel, two conditions must be satisfied: first, there must be a duty of care owed to the party misled or to the public of which that party is a member; and second, the negligence must be the proximate, not a remote, cause of the misleading. Since the Central Bank owed no legal duty to the Mercantile Bank to affix its stamp — it was a mercantile practice, not a legal obligation — estoppel by negligence failed on the facts.

Estoppel of Tenant and Licensee: Section 116 (Section 122 BSA)

Section 116 of the Indian Evidence Act provides that no tenant of immovable property, or person claiming through such tenant, shall, during the continuance of the tenancy, be permitted to deny that the landlord had, at the beginning of the tenancy, a title to such property. The corresponding provision in the BSA is Section 122.

The rationale is elegant in its simplicity: the tenant's position is a permissive and derivative one, founded entirely on the landlord's title and arising from the contractual relationship with the landlord. It would be indefensible for a person who was let into possession by the landlord to then turn around and deny the very title from which his own right of occupation is derived. As the Privy Council stated in Bilas Kunwar v. Desraj Ranjit Singh: "A tenant who has been let into possession cannot deny his landlord's title, however defective it may be, so long as he has not openly restored possession by surrender to his landlord."

However, the estoppel under Section 116 operates only during the continuance of the tenancy. Once the tenancy is terminated and the tenant has surrendered possession, the estoppel ceases. Interestingly, the Supreme Court held in D. Satyanarayana v. P. Jagdish that a tenant cannot, even during the tenancy, set up a claim of adverse possession against the landlord to derogate from the landlord's title. And in Atyam Veerraju v. Pechetti Venkanna (AIR 1966 SC 629), the Court affirmed that a tenant cannot acquire by prescription a permanent right of occupancy against the landlord merely by asserting such a right to the landlord's knowledge during the tenancy.

Estoppel of Acceptor of Bill of Exchange: Section 117 (Section 123 BSA)

Section 117 of the Indian Evidence Act (now Section 123 of the BSA) applies the same principle to the acceptor of a bill of exchange and to a bailee or licensee. No acceptor of a bill of exchange can deny that the drawer had authority to draw or endorse it; similarly, no bailee or licensee can deny that his bailor or licensor had the authority to make the bailment or grant the licence. The logic mirrors that of Section 116: just as the tenant's position is derived from the landlord, the acceptor's liability is derived from the authority he has acknowledged in the drawer, and he cannot subsequently repudiate that acknowledgment to escape liability.

Promissory Estoppel

The most significant evolution of the doctrine in the twentieth century has been the emergence of promissory estoppel — also called equitable estoppel or quasi-estoppel — which travels beyond the representation of existing fact into the realm of promises about the future. The locus classicus is Lord Denning's judgment in Central London Property Trust Ltd. v. High Trees House Ltd. (1947), where a landlord who had agreed to reduce rent during wartime conditions was held estopped from claiming arrears for the war period, even though he was entitled to restore full rent for the future.

In India, the doctrine of promissory estoppel has been powerfully developed in Motilal Padampat Sugar Mills v. State of Uttar Pradesh (AIR 1979 SC 621), where the Supreme Court held that where the Government made a clear and unequivocal promise of tax exemption to a company which had, on the faith of that promise, set up a factory at great cost, the Government was bound by its representation and could not resile from it. Justice Bhagwati drew the distinction between the traditional doctrine (which operates as a shield to deny a cause of action) and promissory estoppel (which can serve as a sword to create one).

However, the doctrine of promissory estoppel is not without limits. The Supreme Court has consistently held that: (a) there can be no promissory estoppel against a statute, since parties cannot by agreement oust or override a parliamentary enactment; (b) the doctrine cannot be invoked where the Government's representation was beyond its authority or prohibited by law; and (c) no estoppel arises against the Government in matters of sovereign function or overriding public interest.

Estoppel: Rule of Evidence or Substantive Law?

This is a question that has exercised courts and legal scholars for a long time, and the honest answer is that the doctrine straddles both domains — and therein lies its great power.

The traditional view is that estoppel is a rule of evidence. Section 115 appears in the Indian Evidence Act — a statute concerned with procedural and evidentiary matters. The Municipal Corporation of Bombay v. Secretary of State (AIR 1934 Bom 277) declared that "the doctrine embodied in this section is not a rule of equity, but is a rule of evidence formulated and applied in courts of law." On this view, estoppel operates only as a shield: it prevents a party from denying a particular fact, and thus enables the other party to enforce a cause of action that would otherwise fail. As was said, "no cause of action arises upon estoppel itself."

However, as Lord Wright observed in Canada Dominion Sugar Co. Ltd. v. Canadian National West Indies Steamships Ltd.: "Estoppel is often described as a rule of evidence, as indeed it may be so described. But the whole concept is more correctly viewed as a substantive rule of law." With the advent of promissory estoppel, the doctrine acquired the capacity to serve as a sword as well — capable of founding an independent cause of action and creating new rights where none previously existed. In BL Sreedhar v. KM Munireddy (AIR 2003 SC 578), the Supreme Court observed that "estoppel, though a branch of the law of evidence, is also capable of being viewed as a substantive rule of law in so far as it helps to create or defeat rights, which would not exist or be taken away but for that doctrine."

Lord Denning captured this duality with characteristically vivid imagery in McIlkenny v. Chief Constable of the West Midlands when he compared estoppel to a large house with many rooms: if you go into one room you find a notice saying "Estoppel is only a rule of evidence"; if you go into another, the notice says "Estoppel can give rise to a cause of action." What is found in one room is not necessarily found in the others, but all the rooms are under one roof.

The view that estoppel is merely a rule of evidence is therefore incomplete and increasingly difficult to defend. The Indian Evidence Act codifies the doctrine in its evidential dimension — preventing a party from denying a representation in a suit or proceeding — but courts have recognised that this statutory text is not exhaustive of the doctrine's reach. As the sections relating to estoppel in the Evidence Act are "not exhaustive," cases of estoppel may arise outside their purview, drawing upon the broader equitable inheritance of the doctrine.

Limits of Estoppel

No survey of the doctrine is complete without an account of its limits.

No estoppel against a statute. The most fundamental limitation is that estoppel cannot override a plain statutory provision. Parties cannot by their conduct confer jurisdiction that the law withholds, nor can they estop a court from applying mandatory law. The Supreme Court affirmed in ESI Corporation v. UOI (2022) that "there can be no estoppel against statutes or regulations having statutory effect."

No estoppel against a minor. A vexed question is whether a minor who misrepresents his age can be estopped from pleading minority. The Privy Council in Mohori Bibee v. Dharmo Das Ghose declined to rule on the point. The better view, flowing from the policy of the Indian Contract Act — under which a minor's contract is void ab initio — is that estoppel cannot be used to enforce what is void in law. However, the courts have fashioned a remedy in restitution: a minor cannot take advantage of his own fraud by retaining benefits obtained through misrepresentation of age, though the juridical basis is not estoppel but the equitable principle that "an infant shall not take advantage of his own fraud."

No estoppel in criminal proceedings against the accused. The doctrine does not apply as against an accused person in a criminal proceeding. An accused may take contradictory pleas, retract a confession, and plead multiple inconsistent defences — none of these create an estoppel against him. However, estoppel by record (through autrefois acquit and autrefois convict, i.e., the rule against double jeopardy) does operate in criminal proceedings, and the prosecution can in appropriate cases be estopped from leading evidence to disturb a finding of fact recorded in an earlier criminal trial involving the same parties on the same issue.

The law of estoppel, in all its facets, is ultimately a doctrine in the service of fairness. It does not permit the truth to be permanently suppressed; it merely prevents a particular party, in a particular relationship, from contradicting what he has solemnly represented when another has acted and suffered in consequence. Whether one classifies it as evidence, procedure, or substantive law, the moral core of the principle remains constant: a man must stand by his word, especially when another has walked forward in reliance on it.