36. Rights of outgoing partner to carry on competing business
(1) An outgoing partner may carry on a business competing with that of the firm and he may advertise such business, but, subject to contract to the contrary, he may not—
(a) | use the firm name, | |
(b) | represent himself as carrying on the business of the firm, or | |
(c) | solicit the custom of persons who were dealing with the firm before he ceased to be a partner. |
(2) 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.