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Thread: Can a govt servant be a partner in any firm/business

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    Junior Member izzner is on a distinguished road
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    Default Can a govt servant be a partner in any firm/business

    Can a govt servant be a partner in any firm/business. My cousin has got an offer of appointment for state govt job. but she is a partner in our family construction partnership firm.

    please help

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    Senior Member jitendraacr is on a distinguished road
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    Dear friend
    It is strictly NO in accordance with CCS(Conduct) Rules.
    Jitendra

  3. #3
    Member venkatcustoms is on a distinguished road
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    Unhappy Govt Servant being partner in a firm

    Rule 15 of CCS (Conduct) Rules, 1964 strictly bar one from being a partner in a firm.

    Let alone conducting a business.

    A govt. servant is even prohibited from buying/selling shares in the stock market. (See the Do's and Don'ts in Swamy Manual - Year book)
    Last edited by venkatcustoms; 01-08-2009 at 10:20 PM. Reason: for citing Rule reference

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    Member coolgoose2 is on a distinguished road
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    Quote Originally Posted by venkatcustoms View Post
    A govt. servant is even prohibited from buying/selling shares in the stock market. (See the Do's and Don'ts in Swamy Manual - Year book)
    Hi Venkat:-)

    I have a slight difference of opinion on the above. Investments in shares, debentures and mutual funds can be made by the Government servant. However "frequent buying and selling" of these are considered as "speculation" and is banned. Investment in shares, mutual funds etc are to be intimated to the Department at the end of every calender year as per the DoPT OM No. 11013/6/91-Estt. (A) dated 8.4.92 regarding CCS [Conduct] Rules, 1964—Transactions in sale and purchase of shares and debentures etc.

    Copy of DOPT OM No. 11013/6/91-Estt. (A) dated 8.4.92 regarding CCS [Conduct] Rules, 1964—Transactions in sale and purchase of shares and debentures etc.



    As the Ministries/Departments are aware, the provisions of sub- rule(4) of Rule 18 of the CCS [Conduct] Rules, 1964 provide that the Government or the prescribed authority may, at any time, by general or special order, require a Government Servant to furnish within a period specified in the order, a full and complete statement of such movable or immovable property held or acquired by him or on his behalf or by any member of his family as may be specified in the order. Such statement shall, if so required by the Government or by the prescribed authority, include the details of the means by which or the source from which, such property was acquired.



    2. Sub-rule (1) of the Rule 16 also provides that no Government Servant shall speculate in any stock, share or other investment. It has also been explained that frequent purchase or sale or both, of shares, securities or other investments shall be deemed to be speculation within the meaning of this sub-rule.



    3. It has been brought to the notice of the Government that a number of employees are investing in shares, securities and debentures etc. frequently. With a view to enable the administrative authorities to keep a watch over such transactions, it has been decided that an intimation may be sent in the enclosed Proforma to the prescribed authority in the following cases:

    1. Group ‘A’ & ‘B’ Officers:– If the total transactions in shares, securities, debentures or mutual funds scheme etc. exceeds Rs. 50000/- during the calendar year.
    2. Group ‘C’ & ‘D’ Officers:– If the total transactions in shares, securities, debentures or mutual funds scheme etc. exceeds Rs. 25000/- during the calendar year.

    4. It is clarified that since shares, securities, debentures etc. are treated as movable property for the purpose of Rule 18 (3) of the CCS [Conduct] Rules, 1964 if an individual transaction exceeds the amount prescribed in Rule 18(3), the intimation to the prescribed authority would still be necessary. The intimation prescribed in para 3 will be in addition to this, where cumulative transaction[s] i.e. sale, purchase or both in shares, securities, debentures or mutual funds etc. in a year exceed the limits indicated in para 3.



    5. In so far as the personnel serving in the Indian Audit and Accounts Department are concerned, these instructions are being issued after consultation with the Comptroller & Auditor General of India.



    6. Ministry of Agriculture, etc. are requested to bring these instructions to the notice of all concerned authorities under their control.



    ANNEXURE



    Form for giving intimation under Rule 18(4) of CCS [Conduct] Rules, 1964 for transactions in shares, securities, debentures and investment in mutual fund schemes etc.



    1. Name and Designation

    2. Scale of pay and present pay

    3. Details of each transaction made in shares, securities, debentures, mutual funds scheme etc. during the calendar year.

    4. Particulars of the party/firm with whom transaction is made:–

    a) Is party related to the applicant?

    b) Did the applicant have any dealings with the party in his official capacity at any time or is the applicant likely to have any dealings with him in the near future?

    5. Source or sources from which financed:–

    a)Personal savings

    b) Other sources giving details

    6. Any other relevant fact which applicant may like to mention

    DECLARATION :



    I hereby declare that the particulars given above are true.



    Station :................................................. ............. Signature...........

    Date : .................................................. ...............Designation..........



    This OM does not prohibit buying and selling of shares etc from Stock market. Hence, in my opinion, if a government servant does not indulge in day-trading and real 'short-term trading' in stock market, he can get away with 'investing' in stock market and giving intimation under Rule 18(4) every year.

    Many of our senior officers regularly do this..

    regards


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