Section 182 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 182 opens Chapter X of the Act, on agency. It gives the two definitions that the rest of the chapter depends on: who is an "agent" and who is a "principal". Every later section on authority, duties, ratification and the rights of third persons builds on these two words.
An "agent" is a person employed to do any act for another, or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the "principal". The definition has two limbs: acting for another, and representing another to third persons. The section prints no illustration and does not itself say who may be an agent (that is section 184) or how authority is created (sections 186 and 187).
Why a definition matters
Business runs on people acting for others: a sales representative signing orders for a company, a property broker negotiating for an owner, a commission agent selling a farmer's produce, a marketplace seller's representative handling returns. Whether such a person is an "agent" under the Act decides which chapter applies: the duties the agent owes, the authority the agent has, and when the principal is bound to outsiders. Our overview of agency under sections 182 to 238 maps the whole chapter. If you are drafting an arrangement in which one person will act for another, an agreement drafting adviser can help you set out the scope clearly.
The text
Section 182 reads: "An 'agent' is a person employed to do any act for another, or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the 'principal'."
The two limbs
The definition names two situations. A person can be an agent in either.
| Limb | Words of the Act | Plain meaning |
|---|---|---|
| First | "employed to do any act for another" | The person is engaged to do something on another's behalf |
| Second | "to represent another in dealings with third persons" | The person stands for another when dealing with outsiders |
The word "or" joins them, so one is enough. A person engaged to sign and negotiate with outsiders fits the second limb; a person engaged to collect, repair or carry out some act for another fits the first.
The principal is then defined by reference to the same two limbs: the person "for whom such act is done, or who is so represented".
What the definition leaves out
Reading the section carefully, several things are not in it:
- No requirement of writing. Section 182 does not say authority must be written. Section 187 says authority may be express (words spoken or written) or implied.
- No requirement of payment. Section 185 separately says "No consideration is necessary to create an agency."
- No requirement about age or mind. Sections 183 and 184 deal with who may employ an agent and who may be one. See our article on sections 183 to 185.
- No list of kinds of agent. The Act elsewhere speaks of sub-agents, substituted agents and mercantile agents, but section 182 gives only the general definition.
- No illustration. The source prints none under this section, so the example below is ours.
A modern example (ours, not the Act's)
Prakash owns a warehouse in Indore and wants his surplus stock sold online. He engages Tara, who runs a seller-support business, to list the stock on a marketplace, answer buyer queries and accept orders in his name. Tara is "employed to do any act for another" (listing, answering queries) and also to "represent another in dealings with third persons" (accepting orders in Prakash's name). She is the agent; Prakash is the principal.
Now take a different arrangement. Prakash sells a lot of stock outright to Tara at an agreed price and she resells at whatever price she likes, in her own name and for her own account. On the face of the definition, she is not employed to do an act for Prakash or to represent him; she deals as a buyer. Whether any particular arrangement is agency depends on its terms and facts, which the section does not decide for you.
The words that do not appear
Notice that the section uses "employed". It does not say "appointed in writing" or "paid". An agent is employed by the principal, and the later sections tell you how: by express words or by inference from circumstances, including the ordinary course of dealing (section 187). The Act speaks only of the relation; it does not use the labels people put on contracts. A person called a "distributor", "representative", "liaison" or "consultant" in a document may or may not be an agent in the Act's sense, depending on what he is actually employed to do.
What can the parties change?
The definition is the Act's own. Parties can choose how to describe their arrangement and can set out the agent's powers, limits and reporting duties in a contract. They cannot, by a label alone, change what the Act means by "agent". What they can do is define the scope of the employment carefully, because the later sections make the extent of authority central.
Practical points
- Say what the agent may do. List the acts and the dealings with outsiders the person is employed for.
- Say what the agent may not do. Express limits help later if a dispute arises about authority.
- Look at conduct, not just the title. The Act asks what the person is employed to do.
- Keep records. Written instructions are the easiest evidence of the employment.
Need help with an agency arrangement?
Whether you are appointing a representative or acting as one, the starting point is a clear document. Our agreement drafting service can help you record who the agent is, who the principal is, and what the agent is employed to do, in plain terms. Other laws may also apply to your sector.
Key takeaways
- An agent is a person employed to do any act for another, or to represent another in dealings with third persons (s.182).
- The principal is the person for whom the act is done, or who is so represented.
- One limb is enough; the two are joined by "or".
- The section says nothing about writing, payment, age or soundness of mind; other sections deal with these.
- The section prints no illustration.
Read next
- Sections 183 to 185: who may employ an agent, who may be agent, and no consideration needed
- Section 186: agent's authority may be expressed or implied
- Specimen agency contract: format and key provisions
Disclaimer: Based on the text of the Indian Contract Act, 1872 as consulted on 1 October 2026. Many questions under this Act turn on case law and on the wording of the particular contract, which this article does not cover. It is general information, not legal advice; check the official text and take advice before acting.