• Regarding trading in shares/stock market for central government employees

I am about to join a central government job soon. I hold shares of various companies amounting to a total of Rs. 1 lakh approximately. 
Will this create any problem for my job if I continue to hold these shares for long term ?
Is trading in shares/stock market allowed for central government employees ?
Please provide details.
Asked 7 years ago in Taxation

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11 Answers

Sir you can continue holding.your shares there won't be any issue. 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.

Futher in terms of rules and DOPT memorendum disclosure of such trading has to he done for each financial year.

Shubham Jhajharia
Advocate, Ahmedabad
25513 Answers
179 Consultations

Purchasing shares and keeping it as long term investment by a government employee is not an offence.

You may proceed.

Indulging in share market trading activities by a government servant is restricted.

T Kalaiselvan
Advocate, Vellore
89978 Answers
2492 Consultations

There is no problem at all

 

Yusuf Rampurawala
Advocate, Mumbai
7899 Answers
79 Consultations

1. Making investments in your own personal account is very much permissible and there is no legal impediment in it even if you hold a government job.

2. You can not make daily r regular trading on behalf of another person but as far as personal investment is concerned it is very much permissible.

3. Few PSU employees may have restrictions in trading shares of the same PSU s . otherwise fell free to make money by making sensible investments in money market.

Devajyoti Barman
Advocate, Kolkata
23653 Answers
537 Consultations

There would be no hassles at all if you are keeping stocks for long term investment, but you cannot do short term speculative trading in the stock market.

Siddharth Jain
Advocate, New Delhi
6617 Answers
102 Consultations

You are at liberty to invest in shares for long term 

 

you cannot carry on trading in shares 

 

frequent buying and selling" of these are considered as "speculation" and is banned.

 

 

Ajay Sethi
Advocate, Mumbai
99776 Answers
8145 Consultations

There is no absolute ban on investing in stocks however speculative trading (may include derivative trading) is not allowed. As per CCS (Central Civil Services) conduct rules 1964, 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. Also for transactions above certain value, the government officers have to inform prescribed authorities.

Mohammed Mujeeb
Advocate, Hyderabad
19325 Answers
32 Consultations

There is no absolute ban on investing in stocks however speculative trading (may include derivative trading) is not allowed. As per CCS (Central Civil Services) conduct rules 1964, 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. Also for transactions above certain value, the government officers have to inform prescribed authorities.

Here is the excerpt of the rules:

(32) Transactions in sale and purchase of shares and debentures etc.
The provisions of sub-rule (4) of Rule 18 of the CCS (Conduct) Rules, 1964 provides 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 prescribed authority, include the details of the means by which or the source from which, such property was acquired.
2. Sub-rule (1) of 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 :-
(i) Group ‘A’ and ‘B’ Officers – If the total transaction in shares, securities, debentures or mutual funds scheme etc. exceeds Rs. 50,000/- during the calendar year.
(ii) Group ‘C’ & ‘D’ Officers – If the total transactions in shares, securities, debentures or mutual funds scheme etc. exceeds Rs. 25,000/- 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.

Prashant Nayak
Advocate, Mumbai
34514 Answers
249 Consultations

no, this won't create any problem for you and let them continue as it is you are trading it legally then you can give the reports if asked to the department as well.

in some posts of government you need to update Government records and update each and everything, so you can continue and keep on investing in future without any worry.

 

 

Every Government servant shall on his first appointment to any service or post submit a return of his assets and liabilities, in such form as may be prescribed by the Government, giving the full particulars regarding -

(a) the immovable property inherited by him, or owned or acquired by him or held by him on lease or mortgage, either in his own name or in the name of any member of his family or in the name of any other person;

(b) shares, debentures and cash including bank deposits inherited by him or similarly owned, acquired, or held by him;

(c) other movable property inherited by him or similarly owned, acquired or held by him; and

(d) debts and other liabilities incurred by him directly or indirectly

*CENTRAL CIVIL SERVICES (CONDUCT) RULES, 1964*

Amol Chitravanshi
Advocate, Delhi
279 Answers
1 Consultation

No, there will be no problem in the same.

yes it is allowed, there is no bar.

regards

Anilesh Tewari
Advocate, New Delhi
18103 Answers
377 Consultations

the central govt employees can invest in shares but they cannot carry on a business. they can invest personally and can earn a profit, which is, of course, taxable.

Rahul Mishra
Advocate, Lucknow
14114 Answers
65 Consultations

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