Principle: Terms of any written contract can be proved by producing the written contract only and oral evidence is excluded.
Facts: A gives B receipt for money paid by B. Oral evidence is offered to prove payment.
This question consists of legal principle(s) (hereinafter referred to as ‘principle‘) and facts. Such proposition may or may not be true in the real and legal sense, yet you have to conclusively assume them to be true for the purposes of this section. Principles have to be applied to the given facts to arrive at the most reasonable conclusion. Only one of the alternatives, i.e., (A), (B), (C), or (D) is the most reasonable conclusion. In other words, in answering the following questions, you must not rely on any principle except the principles that are given herein below for every question. Further you must not assume any facts other than those stated in the question. The objective of this section is to test your ability in legal aptitude, study of law, research aptitude and problem solving ability even if the ’most reasonable conclusion‘ arrived at may be absurd or unacceptable for any other reason.

Question

The doctrine of promissory estoppel is by now well recognized and well defined by a catena of decisions of this Court. Where the Government makes a promise knowing or intending that it would be acted on by the promise and, in fact, the promise, acting in reliance on it, alters his position, the Government would be held bound by the promise and the promise would be enforceable against the Government at the instance of the promise notwithstanding that there is no consideration for the promise and the promise is not recorded in the form of a formal contract as required by Article 229 of the Constitution. The rule of promissory estoppel being an equitable doctrine has to be moulded to suit the particular situation. It is not a hard-and-fast rule but an elastic one, the objective of which is to do justice between the parties and to extend an equitable treatment to them. This doctrine is a principle evolved by equity, to avoid injustice and though commonly named promissory estoppel, it is neither in the realm of contract nor in the realm of estoppel. For application of the doctrine of promissory estoppel the promise must establish that he suffered in detriment or altered his position by reliance on the promise.
Normally, the doctrine of promissory estoppel is being applied against the Government and defence based on executive necessity would not be accepted by the court. However, if it can be shown by the Government that having regard to the facts as they have subsequently transpired, it would be inequitable to hold the Government to the promise made by it, the court would not raise an equity in favour of the promise and enforce the promise against the Government. Where public interest warrants, the principles of promissory estoppel cannot be invoked. The Government can change the policy in public interest. However, it is well settled that taking cue from this doctrine, the authority cannot be compelled to do something which is not allowed by law or prohibited by law. There is no promissory estoppel against the settled proposition of law. Doctrine of promissory estoppel cannot be invoked for enforcement of a promise made contrary to law, because none can be compelled to act against the statute. Thus, the Government or public authority cannot be compelled to make a provision which is contrary to law.
[Extract from the judgment of the Supreme Court in Shree Sidhbali Steels Limited v. State of Uttar Pradesh, (2011) 3 SCC 193, decided on January 20, 2011, hereafter ‘Shree Sidhbali Steels’].

Answer 1

Look closely at what the principle actually excludes, it is oral evidence of the terms of a written contract, meaning the negotiated obligations the parties agreed to. It is not a blanket rule against oral evidence for every fact connected to a transaction that happens to have some paper attached to it.

A receipt is different from a contract in this sense, it is a written acknowledgment that a payment already took place, not a document laying out ongoing contractual terms that the parties are bound by going forward. Proving that a payment occurred is proving a plain fact, and that fact can still be established through oral testimony, the receipt being one way to prove it but not the only way.

Because the exclusion in the principle is tied specifically to contractual terms, stretching it to cover every receipt or acknowledgment would go beyond what the rule says, while removing the exclusion entirely would also go too far the other way. The narrower, accurate reading is that oral evidence to prove the fact of payment remains open here.

So the correct answer is Oral evidence to prove payment is allowed.

Answer 2

Asking what the receipt would need to be for each option to be correct isolates the answer.

Oral evidence to prove payment is allowed: No change is needed, the receipt already functions as an acknowledgment of a fact that occurred, not as a contract setting out ongoing terms, so the exclusion the principle creates for contractual terms simply does not reach it.
Oral evidence to prove payment is not allowed: This would require the receipt to be treated as the written contract itself, whose terms cannot be proved otherwise, but a receipt for money already paid is not that kind of document.
Oral evidence is always allowed to prove all facts: This would require the principle to contain no exclusion at all, but it does exclude oral evidence of a written contract's terms specifically, so this option ignores that exclusion entirely.
Oral evidence is generally disallowed: This would require the exclusion to cover all facts rather than just contractual terms, which is broader than what the principle actually states.

Since the receipt is already a record of a completed fact rather than a set of contractual terms, and the other three options depend on a fact pattern that does not exist here, oral evidence to prove payment remains open.

Therefore, the correct answer is Oral evidence to prove payment is allowed.

Answer 3

Asking what the receipt would need to be for each option to be correct isolates the answer.

Oral evidence to prove payment is allowed: No change is needed, the receipt already functions as an acknowledgment of a fact that occurred, not as a contract setting out ongoing terms, so the exclusion the principle creates for contractual terms simply does not reach it.
Oral evidence to prove payment is not allowed: This would require the receipt to be treated as the written contract itself, whose terms cannot be proved otherwise, but a receipt for money already paid is not that kind of document.
Oral evidence is always allowed to prove all facts: This would require the principle to contain no exclusion at all, but it does exclude oral evidence of a written contract's terms specifically, so this option ignores that exclusion entirely.
Oral evidence is generally disallowed: This would require the exclusion to cover all facts rather than just contractual terms, which is broader than what the principle actually states.

Since the receipt is already a record of a completed fact rather than a set of contractual terms, and the other three options depend on a fact pattern that does not exist here, oral evidence to prove payment remains open.

Therefore, the correct answer is Oral evidence to prove payment is allowed.

The Correct Option is A

Approach Solution - 1

Approach Solution -2

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