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An agreement ...

Question

An agreement by a debtor with the lender to the effect that he would not leave job or further borrow from any body or change his residence is ____________.

A

Void being restricting personal freedom

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B

Voidable

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C

Illegal

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D

Valid agreement

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Solution

The correct option is A Void being restricting personal freedom
Indian Contract Act, 1872 has declared those contract which restricts personal freedom as a void contract. This is because anything restricting personal freedom contained in the contract as per section 23 of the act, and contrary to public policy. As in the present case, the agreement requires debtor to not leave job as well as his residence and no further borrowings from anybody which is restricting personal freedom of the debtor and is also restraint of trade under section 27 of the act.

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