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Right of outgoing partner to carry on competing business

36. Right of outgoing partner to carry on competing businessAn outgoing partner may carry on a business competing with that of the firm and he mayadvertise such business, but, subject to contract to the contrary, he may not-use the firm name,represent himself as carrying on the business of the firm, orsolicit the custom of persons who were dealing with the firm before he ceased to be a partner.Agreements in restraint of trade-A partner may make an agreement with his partners that on ceasing to be a partner he will not carry on any business similar to that of the firm within a specified period or within a specified local limits; and, notwithstanding anything contained in section 27 of the Indian Contract Act, 1872 (9 of 1872), such agreement shall be valid if the restrictions imposed are reasonable.


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