An employee by the terms of his service agreement is prevented from accepting a similar engagement a...........

Indian Contract Act (ICA)1872 Valid and Void Contracts

An employee, by the terms of his service agreement, is prevented from accepting a similar engagement after the termination of service. The restraint is __________.

valid.

void.

illegal.

unenforceable.

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Explanation:

Section 27-
27. Agreement in restraint of trade, void. Every agreement by which anyone 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.