How Central Government Employees Can Invest in Shares Without Violating Rules

Investment Restrictions for Central Government Employees: Shares and SIPs

As per the Central Civil Services (Conduct) Rules, 1964, specifically Section 16, Central Government employees are prohibited from speculative investments in shares and other financial instruments. However, occasional investments made through registered stockbrokers or authorized persons are permitted.

Key Restrictions and Guidelines

According to the Office Memorandum F. No. 11013/6/2018-Ett.A-III issued by the Department of Personnel & Training (DoPT) on 07.02.2019, the following rules apply:

1. Speculation Prohibited: Government employees must not engage in speculative activities like frequent buying and selling of shares, as it is considered speculation under Rule 16.
2. Permissible Investments: Occasional investments via authorized stockbrokers or licensed individuals are allowed, but employees must adhere to reporting limits.

Intimation Limits for Transactions

As per the rules outlined in the OM, intimation to the government is required when transactions in shares, securities, debentures, or mutual funds exceed the following limits within a calendar year:

• Group ‘A’ and ‘B’ Officers: Intimation is mandatory if the total value of transactions exceeds ₹50,000 in a calendar year.
• Group ‘C’ and ‘D’ Officers: Intimation is required if the total value of transactions exceeds ₹25,000 in a calendar year.

Additionally, if the total value of transactions exceeds six months’ basic pay during the year, an intimation must be submitted to the prescribed authority by 31st January of the following year.

Movable Property Reporting

Shares, securities, and debentures are classified as movable property under Rule 18(3) of the CCS (Conduct) Rules. Even if a single transaction exceeds the prescribed limit under Rule 18(3), the employee must inform the government. This requirement is in addition to the intimation rules for cumulative transactions.

Compliance for Indian Audit and Accounts Department Employees

These guidelines also apply to personnel serving in the Indian Audit and Accounts Department, as confirmed in consultation with the Comptroller and Auditor General of India.

Government employees are required to maintain transparency in their financial dealings by following the prescribed limits and reporting requirements for investments in shares and mutual funds. This ensures compliance with the CCS (Conduct) Rules, 1964 and the updated guidelines in the Office Memorandum F. No. 11013/6/2018-Ett.A-III.

Download Proforma for intimation under Rule 18(4) of CCS (Conduct) Rules, 1964 for transactions in shares, securities, debentures, investment in mutual fund schemes,etc