From Equity to Exception: Public Interest as a Defence to Promissory Estoppel

Anshika Patel and Yashasvi Singh argue that the “public interest” defence to promissory estoppel is being raised against the Indian State with insufficient judicial scrutiny, thereby watering down a doctrine that is supposedly designed to hold government to its promises. Their organising lens is the Supreme Court’s February 2025 decision in Puja Ferro Alloys Pvt. Ltd. v State of Goa, where the Court upheld the withdrawal of a long-standing electricity tariff rebate on grounds of fiscal unviability. Tracking the evolution of the doctrine from Indo-Afghan Agencies and Motilal Padambat to Kasinka Trading, Shrijee Sales, and Unicorn Industries, the authors posit that Puja Ferro Alloys demonstrates a transition to a more distributive and expansive interpretation of public interest than earlier fiscal-necessity rationale. They point to three shortcomings: absence of evidentiary threshold allowing unsubstantiated claims by States; poorly developed proportionality review leading to forced binary outcome rather than graduated remedies; and lack of integration of Articles 14 and 19. Patel and Singh propose a three-part framework: an evidentiary threshold, a sequenced three-stage proportionality inquiry and a remedial architecture that allows for compensation or phased withdrawal, concluding that the public interest should be a narrow, judicially earned exception subject to the same justificatory discipline that Article 14 demands of all State action.

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