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Under Section 11(2), a partnership contract may validly provide that a partner shall not carry on any business other than the firm's while he is a partner. This is:
AVoid under Section 27 of the Contract Act
BA valid exception to the rule against agreements in restraint of trade
CEnforceable only after dissolution
DVoidable at the partner's option
Answer & Solution
Correct answer: B. A valid exception to the rule against agreements in restraint of trade
Section 11(2) expressly permits such a restraint notwithstanding Section 27 of the Contract Act, so it is a valid exception to the general bar on agreements in restraint of trade.
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