Section 40Chapter V
Agreements in restraint of trade
INCOMING AND OUTGOING PARTNERS
(2)
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 specified local limits; and, notwithstanding anything contained in section 27 of the Contract Act, 1872, such agreement shall be valid if the restrictions imposed are reasonable.