Of Contracts, Voidable Contracts And Void Agreements
Section -27 – Agreement in restrain of trade, void –
Every agreement by which any one is restrained from exercising a lawful profession, trade or business of any kind, is to that extent void.
Exception 1 – Saving of agreement not to carry on business of which goodwill is sold –
One who sells the goodwill of a business may agree with the buyer to refrain from carrying on a similar business, within specified local limits, so long as the buyer, or any person deriving title to the goodwill from him, carries on a like business therein, provided that such limits appear to the Court reasonable, regard being had to the nature of the business.