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Chapter X - Agency

Section 183

Section 183: Capacity to appoint an agent

A person of legal majority and sound mind may employ an agent.

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Need advice on Section 183?

This article is for general information. Refer to the Indian Contract Act, 1872 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.

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Statutory text

Bare law

Any person who is of the age of majority according to the law to which he is subject, and who is of sound mind, may employ an agent.

Rule and business relevance

Majority is assessed under the law to which the appointing person is subject. Capacity of the principal is separate from the rule concerning who may act as agent.

Limits and related provisions

For a company or other entity, also verify the relevant authority to make the appointment. This short provision is not a substitute for corporate authorisation requirements.

Hypothetical business example

Hypothetical example: An adult business owner of sound mind appoints a representative; a company making an appointment additionally checks its authorised decision-making process.

Practical decision flow

Confirm the appointing person’s legal capacity.

Identify the applicable majority law.

Check any entity-level authority required for the appointment.

Check the applicable legal framework

This guide explains the central provision. Applicable State amendments, the agreement, transaction date and other governing laws can affect its application. Check the current legal framework before relying on it for a commercial decision.

Practical checklist

Do

  • Confirm the appointing person’s legal capacity.
  • Identify the applicable majority law.
  • Check any entity-level authority required for the appointment.

Avoid

  • For a company or other entity, also verify the relevant authority to make the appointment. This short provision is not a substitute for corporate authorisation requirements.

Glossary

Majority
The age status determined under the person’s applicable law.
Sound mind
The capacity condition expressly stated for employing an agent.

Frequently asked questions

Is the appointing principal’s capacity relevant?

Yes. Majority and sound mind are stated conditions.

Is the rule identical to section 184?

No. Section 184 addresses who may be an agent.

Should companies check internal authority too?

Yes. Applicable entity and authorisation rules require separate consideration.

Need help applying this provision to your situation?

Contact Bizeneed

Last updated 10 October 2026