AGREEMENT BETWEEN A MANUFACTURER AND SELLING AGENT

AGREEMENT  BETWEEN A MANUFACTURER AND SELLING AGENT

               

                AN AGREEMENT  made on this………………..day of …………………BETWEEN  ABC & Co. Ltd. having its registered office at………….(hereinafter called the “manufacturer”) of the one part  AND  PN  son of………………..resident of…………….(hereinafter called the agent) of the other part.

WHEREAS the manufacturer carries on the business of manufacturing baniyans, underwears, hosiery and  other wearing apparel of all kinds.

AND WHEREAS the manufacturers  is desirous  of opening retail shops in various towns of India and is willing  to appoint  agents for this purpose who shall have to act exclusively as  the selling agents  of the products of the  manufacturer.

AND WHEREAS the said  agent has approached the manufacturer and expressed his consent to act  as such agent  on the terms and conditions mutually agreed upon.

                NOW, THEREFORE, THIS AGREEMENT WITNESSES as follows:

1.             The manufacturer carries on the business of manufacturing baniyans, underwears, hosiery and other wearing apparel of all kinds.

2.             The manufacturer  is desirous  of opening  retail  shops  in various towns  of India and is willing  to appoint  agents  for this  purpose who shall have to act exclusively has the selling agents of the products of the manufacture.

3.             The said agent  has  approached  the manufacturer  and expressed his consent  to act  as such agent on the terms and conditions  mutually agreed upon;

                NOW, THEREFORE, THIS  AGREEMENT  WITNESSES  as follows :

1.             That the agent shall deposit a sum of Rs…………..as security for the due  fulfilment  of the terms  of this agreement as  well as  for the adjustment  thereof  against  the price of the goods  supplied to the agent by the manufacturer from time to time.

2.             That   the manufacturer shall supply an assortment of goods manufactured  by it approximately  of the value of Rs……………in the first  instance and thereafter  shall furnish to the agent at his request in writing such further goods as may be so requisitioned by him or as the  manufacturer  may think  expedient to supply to the agent  to be kept in the shop run  by the agent, so that the  total  value thereof  at any time  may not, if  requisitioned  by the agent, exceed  the value of Rs…………………but it shall be  at the option of the  manufacturer  to supply  further  goods  of its manufacture, which   it may deem  expedient, subject, however, to the compliance with the requisition made to the manufacturer by agent as aforesaid  to replenish the stock which, in the  opinion of the agent, finds a ready market for  its  sale.

3.             That  the agent  shall keep proper account and shall issue cash voucher for every article sold by him, which shall be  prepared in triplicate, one legible  copy whereof  shall be submitted to the manufacturer by the agent every Friday or the next day on which the shop is opened by the agent in case Friday should be a close-day. The copies of  such  vouchers  shall be  accompanied  with a statement of account showing the goods received by the agent from the manufacturer during  the previous week ending with Saturday  previous to Friday on which the return is so submitted.

4.             That all the goods supplied by the manufacturer shall be deemed to be in  trust with  the agent for the purposes of sale on behalf of the  manufacturer  and any wilful omission  or non-mention thereof  in the return of  the sale and  receipt  of goods  submitted  to the manufacturer  weekly as aforesaid  shall be  deemed to be a misappropriation thereof unless  such  omission when pointed out and notified by the manufacturer  is not rectified or appropriately explained within   one week  of such notification.

5.             That the manufacturer  shall pay to the agent  a commission of……….per cent on the sale  of the  goods  so supplied to the agent. The  agent shall be entitled  to deduct the commission out  of the  sale-proceeds and  shall be bound  to remit  to the manufacturer  the balance  of the sale-proceeds  receive by the agent up  to  Saturday  previous, which  shall be so remitted on or before Friday next ensuing. The  agent, however, shall, at his discretion, be  entitled  to sell not  more than 10  per cent  of the sales  effected  during the week on credit and he shall be bound  to realise such outstandings  within two months  of the sale  be bound  to pay  in cash from  his  own  pocket  for the price  of the foods so sold  on credit. The  return  submitted by the agent  shall show in a separate  account the sales so made on credit  and the  realizations  made thereon   from time  to time.

6.             That the agent shall not  sell any article  at a price less than the one marked thereon by the manufacturer or fixed  in respect of the article  by the  manufacturer  from time to time. Any article which becomes soiled or partly broken or otherwise unfit for sale or otherwise apparently diminished in value shall not be exposed for sale by  the agent except  with the prior  approval of the manufacturer, and at prices to be  mutually settled  between  the parties. The agent shall be entitled to give a concession of not more than 5 per cent of the saleable value of any article  to any  old customer of the agent or any relation of the agent. The agent shall  indicate  in the return  submitted  by him weekly as provided in the agreement the fact  of such sale at concessional rates.

7.             That the agent shall take reasonable care of the goods supplied by the manufacturer and in case of any  theft or injury thereto distruction thereof,  he shall make a  report  to the  police in case  of a cognizable offence  having been  committed  in respect thereof  and forward a copy thereof to the  manufacturer  or submit a report  in respect thereof  within three days  of the  occurrence or its cognizance  by the agent. the agent shall   assist the  manufacturer  in the  apprehension  of the offender  or in alleviating or removing  the cause  of such injury, if any. In the event  of the manufacturer  making a claim for compensation or otherwise  from any  insurance company the agent shall assist  the manufacturer as if the agent  was himself the assured.

8.             That  the agent  shall keep the goods of the manufacturer  for sale in  a premises  approved  by the manufacturer  which shall kept clean and well  equipped with furniture and other  conveniences for the customers.

9.             That  this agreement is made  to run for a period  of  two years liable, however, to be terminated earlier, ipso facto in the event of bankruptcy or death of the agent or at the expiry  of a notice  of a fortnight  served on or delivered  to the agent  at his address aforementioned  or sent  by  registered  post to him  at the said  address  in case of default  of or breach committed by  the agent  in respect  of any of the  terms of this  agreement. The  agent  may  also terminate  this  agreement after giving  one  month’s  notice to the  manufacturer in any of the aforementioned  modes in case the manufacturer  should fail  to comply  with or commit a breach of the terms of this agreement.

10.          That any dispute arising between the parties touching the interpretation or compliance or non-compliance with the terms or  conditions of this agreement shall be referred to the arbitration of the President of the District Bar Association who may determine the dispute himself or refer  the dispute to the arbitration of any  other member of the Bar Association at …………….The fees of the arbitrator shall be determined  by the said  President  with the assent of the parties, failing which by Court having jurisdiction at…………..to try and decide the dispute.

11.          That at the termination of this agreement, the accounts between the parties shall be mutually adjusted within one month of such termination . In case any party fails to assist  in such examination or adjustment of accounts and the  taking of stock, the other party may refer the examination  and taking of accounts to the determination of the President of the District Bar Association at………….and the provision of CI. 9 aforesaid shall apply thereto.

12.       That no commission shall be payable to the agent after the termination of the agreement whether by efflux of time or otherwise under this agreement, except when this agreement is renewed and the parties mutually further agree thereto or the arbitrator in the event of reference thereto, thinks fit to allow such commission either by interlocutory award or finally subject to such terms as the arbitrator may deem proper.

13.       That the agent shall not, during the period of two years fixed in the agreement (and notwithstanding prior determination thereof by any party thereto), sell goods of any other manufacturer or person and the manufacturer shall not appoint any other selling agent within a radius of ……. Yards of the shop of the agent.

            IN WITNESS WHEREOF the parties have signed this agreement on the day and year first above written.

………………………………..                                              ……………………………..

            (Agent)                                                                                   (Manufacturer)

 DISCLAIMER: THE ARTICLE IS BASED ON THE RELEVANT PROVISIONS AND AS PER THE INFORMATION EXISTING AT THE TIME OF THE PREPARATION. IN NO EVENT I SHALL BE LIABLE FOR ANY DIRECT AND INDIRECT RESULT FROM THIS ARTICLE. THIS IS ONLY A KNOWLEDGE SHARING INITIATIVE.

THE AUTHOR – CS DEEPAK SETH (ASSOCIATE PARTNER HELPINGHANDS PROFESSIONALS LLP) AND CAN BE REACHED AT CONTACTHHPRO@GMAIL.COM OR 9910248911.