Case: Delhi Cloth and General Mills Limited Vs. Union of India

he then was) in Motilal Padampat Sugar Mills Co. Ltd. v. State of U. P. ((1979) 2 SCR 641 at p. 695 : (1979) 2 SCC 409 ). The learned Judge had said : (SCC p. 452, para 33)We do not think that in order to invoke the doctrine of promissory estoppel it is necessary for the promisee to show that he suffered detriment as a result of acting in reliance on the promise. But we may make it clear that if by detriment we mean injustice to the promisee which could result if the promisor were to recede from his promise, then detriment would certainly come in as a necessary ingredient. The detriment in such a case is not some prejudice suffered by the promisee by acting on the promise, but the prejudice which would be caused to the promisee, if the promisor were allowed to go back on the promise. 23. The view taken in Motilal Padampat Sugar Mills case ((1979) 2 SCR 641 at p. 695 : (1979) 2 SCC 409 ) has been reiterated in Union of India v. Godfrey Philips India Ltd. ((1985) 4 SCC 369 : 1985 Supp 3 SCR 123) 24. The concept of detriment as we now understand it is whether it appears unjust, unreasonable or inequitable that the promisor should be allowed to resile from his assurance or representation, having regard to what the promisee has done or refrained from doing in reliance on the assurance or representation. 25. It is, however, quite fundamental that the doctrine of promissory estoppel, cannot be used to compel the public bodies or the government to carry out the representation or promise which is contrary to law or which is outside their authority or power. Secondly, the estoppel stems from equitable doctrine. It, therefore, requires that he who seeks equity must do equity. The doctrine, therefore, cannot also be invoked if it is found to be inequitable or unjust in its enforcement. 26. We may also state that for the purpose of invoking the doctrine, it is not necessary for the company to show that the assurance contained in Ex. C-5 was mainly responsible for establishing the factory at Kota. There may be several representations to one party from different authorities in regard to different matters. Or, there may be several representations from the same party in regard to different matters. As in the instant case, there was one representation by the Rajasthan Government to supply power to the company at concessional rate. There was another representation from the same government to exempt the company from payment of tax for certain period. There may be other representations from the same or some other authorities. If those representations have been relied upon by the company, the court would compel those parties to adhere to their respective representations. It is immaterial whether each of the representations was wholly responsible or partly responsible for locating the factory at Kota. It is sufficient if the company was induced to act on that representation. 27. The last and final aspect of the matter to which attention should be drawn is that for the purpose of finding whether an estoppel arises in favour of the person acting on the representation, it is necessary to state that the representation must be clear and unambiguous and not tentative or uncertain. In this context we may usefully refer to the following passage from Halsburys Laws of England (4th Edn., Vol. 16, p. 1071, para 1595)1595. Representation must be unambiguous. - To found an estoppel a representation must be clear and unambiguous, not necessarily susceptible of only one interpretation, but such as will reasonably be understood by the person to whom it is made in the sense contended for, and for this purpose the whole of the representation must be looked at. This is merely an application of the old maxim applicable to all estoppels, that they "must be certain to every intent. 28. The question now is whether the assurance given by the Railway Board in the letter Ex. C-5 was clear and unqualified. But unfortunately, it is not so. It was subject to review to be undertaken when the company starts moving the raw material. Ex. C-5 reads: New Delhi 1 Dated November 5, 1966 Dear Sir Sub. : Integrated Fertilizer - PVC project at Kota Rajasthan - Rail movement of Naptha Ref. : Your letter No. SFC/Gen-72 dated September 5, 1966 I am directed to state that the Railway Board agree to quote a special rate equal to class 85-B (Special) CC : K for transport of Naptha in train loads from Bombay or Koyali to Kota, for manufacture of fertilizers. The proposed special rate will apply at owners risk Since the special rate is being quoted ahead of the actual setting up of the factory the rate may need to be reviewed when thetraffic actually begins to move. The Railway may accordingly be approached before the traffic actually starts moving Yours faithfully Sd/- R. L. Sharma for Secretary Railway Board 29. What does this letter mean ? The first part of the letter offering the concessional rate equal to class 85-B (special) has been completely watered down in the second part of the letter. It has been expressly stated that the rate may need be reviewed when the traffic actually begins to move. The company was put to notice that it has to again approach the Railway Administration. The Railway authorities now state that they have reviewed the whole matter and found no justification to offer a concessional freight rate for Naptha, since fertilizers are deliberately given a low classification in the tariff. From the tenor of Ex. C-5 the Railways are entitled to state so, and it does not amount to resiling form the earlier assurance. No question of estoppel arises in favour of appellant out of the representation made in Ex. C-5. 30. We, therefore, agree with the conclusion of the Tribunal but not for all the reasons stated.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]Section 28 is obviously based on the principle that the power derived from the monopoly of railway carriage must be used in a fair and just manner in respect of all persons and all descriptions of traffic passing over the railway area. In other words, equal charges should normally be levied against persons or goods of the same or similar kinds passing over the same or similar circumstances; but this rule does not mean that, if the railway administration charges unequal rates in respect of the same or similar class of goods travelling over the same or similar areas, the inequality of rates necessarily attracts the provisions of Section 28. All cases of unequal rates cannot necessarily be treated as cases of preference because the very concept of preference postulates competition between the person or traffic receiving preference and the person or traffic suffering prejudice in consequence. It is only as between competitors in the same trade that a complaint of preference can be made by one in reference to theIn the light of these principles, the Tribunal considering the material on record held that there is no evidence produced by the company to justify any grievance under Section 28. We see no reason to disagree with this conclusion. It is, in our opinion, perfectly justified. In fact Mr. K. K. Jain learned counsel for the appellant also did not seriously dispute the correctness of that finding recorded by theThe last and final aspect of the matter to which attention should be drawn is that for the purpose of finding whether an estoppel arises in favour of the person acting on the representation, it is necessary to state that the representation must be clear and unambiguous and not tentative or uncertain. In this context we may usefully refer to the following passage from Halsburys Laws of England (4th Edn., Vol. 16, p. 1071, para 1595)1595. Representation must be unambiguous. - To found an estoppel a representation must be clear and unambiguous, not necessarily susceptible of only one interpretation, but such as will reasonably be understood by the person to whom it is made in the sense contended for, and for this purpose the whole of the representation must be looked at. This is merely an application of the old maxim applicable to all estoppels, that they "must be certain to every intent