Under the Indian Contract Act, 1872, an agreement for the sale of goodwill for a specified area, to…
An agreement for the sale of goodwill is not inherently prohibited. Section 27 also expressly permits a reasonable specified-area restraint by the seller of goodwill while…
Choose your answer
Under the Indian Contract Act, 1872, an agreement for the sale of goodwill for a specified area, to which the purchaser agreed, is:
Answer and explanation
Correct answer C
An agreement for the sale of goodwill is not inherently prohibited. Section 27 also expressly permits a reasonable specified-area restraint by the seller of goodwill while the buyer or successor carries on a like business there. This is a qualified exception; it does not make every restraint associated with goodwill automatically enforceable.
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