The Hon’ble Supreme Court in Pratima Chowdhury v. Kalpana Mukherjee, (2014) 4 SCC 196 clarified and explained the rules governing promissory estoppel. It held that the rule of estoppel is a doctrine based on fairness. It postulates the exclusion of the truth of the matter. All for the sake of fairness. A perusal of the above provision reveals four salient preconditions before invoking the rule of estoppel.
(i) Firstly, one party should make a factual representation to the other party.
(ii) Secondly, the other party should accept and rely upon the aforesaid factual representation.
(iii) Thirdly, having relied on the aforesaid factual representation, the second party should alter his position.
(iv) Fourthly, the instant altering of position, should be such, that it would be iniquitous to require him to revert back to the original position.
Therefore, the doctrine of estoppel would apply only when, based on a representation by the first party, the second party alters his position, in such manner, that it would be unfair to restore the initial position.