Photo diode is used to capture reflected light of IR LED.
A semiconductor diode that, when exposed to light, generates a potential difference or changes its electrical resistance.
A Photo diode is a reverse biased silicon or germanium pn junction in which reverse current increases when the junction is exposed to light.
When no light is incident on the pn junction of photo diode, the reverse current is extremely small. This is called DARK CURRENT.
When light is incident on the pn junction of the photo diode there is a transfer of energy from the incident light (photons) to the atoms in the junction .this will create more free electrons (and more holes) these additional free electrons will increase the reversecurrent.This electrical energy can be recorded as voltage drop fluctuations by using a series resistor in the outer circuit and taking voltage readings across it.