It uses the principle that the positive phase angle of an inductive impedance can be compensated by the negative phase angle of a capacitive impedance when put in the opposite arm and the circuit is at resonance; i.e., no potential difference across the detector (an AC voltmeter or ammeter)) and hence no current flowing through it.
It applies the principle that a positive phase angle of an inductive impedance can be counterbalanced by a negative phase angle of a capacitive impedance when they are positioned oppositely, leading to resonance with zero potential difference across the detector (an AC voltmeter or ammeter) and no current flowing through it.