Section 182 of the Contract Act defines the term “Agent” and “Principal” as “An agent is a person employed to do any act for another or to represent another in dealing with another person. The person for whom such act is done, or who is so represented, is called the “principal”. In an agency one person (Principal) employs another person (agent) to represent him or to act on his behalf, in dealings with a third person. The act of an agent binds the principal in the same manner in which he would bound if he does that act himself. The agent may be expressly or impliedly authorized to do an act on behalf of the principal.

Use of the word “agent” for a person is not conclusive proof of the fact that there is agency in law between the parties. “The court must examine the true nature of the agreement and the subsequent dealings between the parties and then decide whether it established a relationship of agency under the law. It is the common experience that the word ‘agent’ is frequently used to describe a relationship which is not an agency in law.

Different Kinds of Agents:

Depending on the kind of authority given to the agent to act on behalf of the principal, the agents are of various kinds:

  1. Auctioneers: An auctioneer is an agent whose business is to sell goods or other property by auction, open sale. The authority vested in him is to sell the goods only, and not to give warranties on behalf of the seller, unless expressly authorized in that behalf. He is mercantile agent within meaning of section 2(9) of the sale of goods Act.
  2. Factors: A factor is a mercantile agent who is entrusted with the possession of the goods for the purpose of sale. He has also the power to sell goods on credit and also to receive the price from the buyer. If the owner has put a factor in possession of the goods or the document of title but without authorizing him to sell the goods, the sale of goods by him will convey a good title to a bona fide buyer.
  3. Brokers: A broker is an agent who has an authority to negotiate the sale or purchase of goods on behalf of his principal, with a third person.
  4. Del Credere Agents: Generally, the function of an agent is over after a contract is established between his principal and a third person. He is not answerable to his principal for the failure of the third person to perform the contract. A del credere agent constitutes an exception to his rule. He is a mercantile agent , who , on the payment of some extra commission , known as del credere commission, guarantees the performance of the contract by the third person.      


1.Contract Act – Avatar Singh – Eastern Book Company –


Aishwarya Says:

I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.


Do follow me on FacebookTwitter  Youtube and Instagram.

The copyright of this Article belongs exclusively to Ms. Aishwarya Sandeep. Reproduction of the same, without permission will amount to Copyright Infringement. Appropriate Legal Action under the Indian Laws will be taken.

If you would also like to contribute to my website, then do share your articles or poems at

In the year 2021, we wrote about 1000 Inspirational Women In India, in the year 2022, we would be featuring 5000 Start Up Stories.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Create a website or blog at

Up ↑

%d bloggers like this: