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1973 Supreme(MP) 18
High Court Of Madhya Pradesh
P. K. Tare, C. J. and G. P. Singh, J.
GAJANAN SAW MILL - Appellant
Versus
STATE OF M.P. - Respondents
Misc. Petn. 683 Of 1972
Decided On : 02/13/1973
M.V.TAMSKAR, V.S.DABIR, Y.S.DHARMADHIKARI
Headnote:(1) Promissory Estoppel - development of the equitable theory – essential ingredients -law as applied in England and India - doctrine does not apply to legislative or quasi -legislative acts.
(2) Evidence Act, 1872 - S.115 - estoppel and Promissory Estoppel.
The operation of Promissory Estoppel or quasi estoppel in the English Law has been changing from time to time and still its limits are uncertain. [Para 4]
It is to be noted that the doctrine of Promissory Estoppel contemplates the existence of a contract initially or in the alternative some obligation which a party is required to discharge. Subsequently that party resiles from its obligations and, therefore, the other party can invoke the doctrine of Promissory Estoppel, although there may not have been a concluded binding contract The English Courts have applied this doctrine to such cases where despite the fact that there is no concluded binding contract, the contracting party has made some promise which it is bound to carry out, because the other party has already relying on such representations acted to its own prejudice. This doctrine is certainly different from and in addition to the principle of estoppel as per the provisions of section 115 of the Indian Evidence Act. It is applied not only to private parties, but also to executive actions taken on behalf of the State.
In this connection we might observe that if any rights have arisen in favour of a contracting party on the strength of a promise in present and on the term of performance in futuro the doctrine can certainly be invoked by that party. But in no case the doctrine can be applied so as to prevent the action which may be quasi-legislative or to executive action in the matter of enforcement of the provisions of a statute or to judicial actions. The doctrine ought to be limited to the actions of private parties or to the purely executive actions of the State and the doctrine cannot be extended any further.
The doctrine can be applied only to executive acts and not to legislative acts or quasi-legislative acts.
There can be no estoppel against legislature and similarly the doctrine of estoppel cannot be applied against any authority which is trying to carry out the intention of the legislature in the matter of applying statute in the manner provided by the legislature. For this reason the Courts would decline to apply the doctrine of Promissory Estoppel to such actions of the Government which may either be considered to be executive in nature or quasi-legislative in natural but which originate in the power conferred by the legislature in the matter of applying enactments to areas or from certain dates or upon fulfillment of certain conditions. Case Law both English and Indian discussed. [Para 18]
(3) Constitution of India - Art. 226 - writ cannot be issued to get out of a ban imposed by Legislature - Van Upaj (Vyapar Viniyaman) Adhiniyam, 1969 (MP) S.5.
No petitioner can claim to trade in the forest produce notified with effect from the date of notification, i.e. from 14.9.1972 onwards. As there is an absolute ban on any private trading, no law Court would grant the petitioners the relief of specific performance of contract, which the petitioners want by seeking writs in the present cases. They in fact want a writ of Mandamus requiring the respondents to confirm their auction sales and to allow them to work out the forests for the period of action. In view of the statutory ban imposed on private trading, such a relief can evidently not be granted. [Para 20]
( 1 ) THIS order shall govern the disposal of all the Writ petitions mentioned above. We propose to deal with these Writ petitions in two groups. In one group will be writ Petition No. 684 of 1972-- Babulal and Co. v. The State of M. P. and Ors. In the other group will be all other Writ 'petitions in which facts are similar. The only distinction between these two groups is that in the case of Babulal and Co. v. The state of M. P. (M. P. No. 684 of 1972), the forest authorities had communicated to the petitioner. Babulal. acceptance of his highest bid and he was delivered possession of the coupe and it is his allegation that work had already been started and subsequently he was asked to stop the work and hand back possession to the forest department. In all other cases either no orders were passed regarding acceptance of the highest bids or in some cases orders had been passed by the proper authorities and the same had been communicated to the subordinate forest officers. But. such orders were not despatched for being communicated to the forest contractors. Therefore, it is the contention of the respondents that the contracts in all other Writ petitions wera inchoate, which would not confer any rights on those petitioners. Whatever rights may have become choate would be in favour of M/s. Babulal and Co. alone.
( 2 ) ON 21-7-1972 (Vide Annexura 5) there was a Gazette Notification intimating that forest contracts in respect of timber, firewood and charcoal for Sagar division would be auctioned on 4-8-1972 and 5-8-1972. The auctions were duly held on those two dates and the present petitioners were the highest bidders and their bids were higher than the upset price fixed by the department. The petitioners on 4-8-1972 deposited 10% of the auction price as required by the Rules. They also deposited security as required. So far as the case of M/s. Babulal and Co. is concerned, the competent authority, namely, the Conservai tor of Forests accepted his bid on 12-8-1972. He deposited 10% of the auction price as also the security and signed the contract on 12-8-1972. The acceptance of his bid was also communicated to him. But, in other cases, although orders about acceptance had been passed and, had been sent to the subordinate forest authorities, such orders were not at all despatched to the forest contractors. In some cases no such orders of acceptance had been passed, and further auction in respect of those contracts was suspended as the State intended to take action under the Madhya Pradesh van Upai (Vyapar Viniyaman) Adhiniyam. 1969 (No. 9 of 1969) (Madhya Pradesh forest Produce (Trade Regulation) Act. 1969 ). The said Act was extendedto Sagar division with, effect from 14-9-1972. On that date the contract of M/s. Babulal and co. alone was legally finalised and the said firm had started working the forest. But, in all other cases there was no such finali-sation and work was suspended. A notification dated 14-9-1972 (Vide respondents' Annexure 4) was issued applying the said Act to the Sagar division. Thereafter the petitioners made demands which were turned down by the respondents and consequently the present petitions were filed in October 1972, or thereabout and it was after filing of the Writ petitions that the petitioners were intimated by the forest authorities that their bids had not been accepted. A works order dated 21-8-1972 (Vide petitioners' Annexure B/l)had also been issued to M/s. Babulal and Co. But in all other cases no such order had been issued, nor acceptance of bids had been communicated by the competent autho- rities. The learned counsel for the petitioners urged that as the respondents had advertised sale of forest produce by public auctions and that auctions had already been held, the respondents could not thereafter withhold acceptance of the, bid. In support of this contention the learned counsel invoked the doctrine of promissory estoppel and urged that the respondents could not so back on their
