Contract of Agency

Posted on by Rudrajyoti Nath Ray

The ambit of a contract of agency has been elaborated upon lucidly by this Court on various occasions. As averted to in Lakshminarayan Ram Gopal & Son Ltd. v. Government of Hyderabad, (1955) 1 SCR 393 a contract of agency does not entail control over minutiae of agent’s actions. Such a level of oversight would more closely resemble a master-­servant relationship. In a principal­-agent relationship, it is sufficient for latter to be informed of responsibilities and duties and certain guidelines on how to satisfy them. An agent undoubtedly retains a sizeable level of discretion on how to achieve desired results. This characteristic of a contract of agency was cemented by this Court in Qamar Shaffi Tyabji v. Commissioner, Excess Profits Tax, Hyderabad, (1960) 3 SCR 546.

– Hon’ble Justice Surya Kant, Singapore Airlines Ltd. v. C.I.T., Delhi, [Civil Appeal No. 6964-6965 of 2015].

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