What is consignment ?
Consignment is a special kind of business where goods are sold throughout the country not directly, by owner but through agents on the basis of commission . The owner of the business is known as a consignor and the person who sells goods on behalf of the consignor is known as a consignee.(agent)
It is a special kind of business where goods care despatch (send) to various agent appointed at different place and who are like to sale goods on behalf of master as per direction and instruction of master only or basic commission on sales .of guests through agent
Parties Involved in Consignment
There are two party in consignment business:
The person who sale goods to his agent to be sold on behalf of him is known as a consignor. Consignor is the real owner of a business who takes profit , bearers losses of the business.
The person to whom goods are sent by business to be sold to others on commission basis is known as Consignee Or agent.
Characteristics of Consignment Business .
1.Consignment business is governed by laws of agency of Indian contract not Boos 1872,agency act
2.There are a minimum and maximum two person required for Consignment business.
a. Consignor (Owner, principal)
b. Consignee (agent)
3.The relationship between consignor and conscience is like a relationship of master and servant or principal and agent.
4.The agent who act on behalf of business is known as Consignee.
5.The real owner of the business is Consignor.
6 .The agent must act as per instruction of the principal.
7.Agent appointed on the basis of payment of commission on Sales made by him .
8.The goals which are sent to the consignee (agent) is known as outward consignment, for the consignor.
9.The goods which are received by the consignee will be in- ward consignment for the consignee.
10.Consignee is required to take care of goods received by him.
11.All the expenses on the consignment business will be owned by the Consignor only.
12.Any expenses made by the agent will be brushed by the Consignor.
13.Consignee not required to pay any amount for goods received.