Supreme Court in Lakshminarayan Ram Gopal and Son Ltd. Vs. The Government of Hyderabad, wherein the Supreme Court has distinguished the words ‘agent’ and ‘servant’ and held as follows :
The difference between the relationship of master and servant and principal and agent may be said to be this. A principal has the right to direct what work the agent has to do, but a master has the further right to direct how the work is to be done. The position is further clarified in Halsbury’s Laws of England-Hallsham Edition Vol. 1 at page 193.
An agent is to be distinguished on one hand from a servant and on the other from an independent contractor. A servant acts under the direct control and supervision of his master and is bound to form to all reasonable orders given to him in the course of his work; an independent contractor, on the other hand is entirely dependent of any control or interference and merely undertakes to produce a specified result, employing his own means to produce that result. An agent though bound to exercise his authority in accordance with all lawful instructions which may be given to him from time to time by his principal, is not subject in its exercise to the direct control or supervision of the principal. An agent as such is not a servant but a servant is generally for some purposes his master’ implied agent, the extent of the agency depending upon the duties or position of the servant.