55.
Sale of goodwill after dissolution.-
(1) In settling the accounts of a firm after
dissolution, the goodwill shall, subject to
contract between the partners, be included in
the assets, and it may be sold either separately
or along with other property of the firm.
(2) RIGHTS OF BUYER AND SELLER
OF GOODWILL: Where the goodwill of a firm is
sold after dissolution, a partner may carry
on a business competing with that of the buyer
and he may advertise such business, but, subject
to agreement between him and the buyer, 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
its dissolution.
(3) AGREEMENTS IN RESTRAINT
OF TRADE: Any partner may upon the sale of the
goodwill of a firm, make an agreement with the
buyer that such partner 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 Indian Contract Act, 1872
such agreement shall be valid if the restrictions
are reasonable.
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