Question

Promissory estoppel against Government agencies is decided in:

• A. Tweedle Vs Atkinson
• B. Dutton Vs Poole
• C. Pournami oil Mills Vs State of Kerala
• D. Kedar Nath Vs Gauri Mohamad

Hint:

While the government has wide powers, it is not immune from the principle of promissory estoppel. Cases like {Pournami Oil Mills} established that the government can be held to its promises, especially when citizens have acted upon them.

Answer 1

The Correct Option is C

The doctrine of promissory estoppel prevents a person from going back on a promise if the other person has acted upon that promise to their detriment. While the doctrine was initially applied to individuals, its application against the Government was a significant legal development. In the case of Pournami Oil Mills v. State of Kerala, the Supreme Court strongly affirmed that the doctrine of promissory estoppel is applicable against the Government. The court held that if the government makes a promise (e.g., a tax exemption to encourage investment) and an entrepreneur acts on it, the government cannot later arbitrarily go back on that promise. The other cases are related to different principles: (a) and (b) relate to privity of contract, and (d) relates to consideration for a charitable subscription.