Multiple choice

Under Section 27 of the Indian Contract Act, 1872 in which of the following relation an agreement in restraint of trade is valid:

  1. Mutual adjustment

  2. Business contingency

  3. Sale of goodwill

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Under Section 27 of Indian Contract Act, 1872, agreements in restraint of trade are void except when they relate to sale of goodwill. The buyer of goodwill may be restrained from carrying on similar business at the seller's location, provided it's reasonable in area and time.

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