Conduct Rules and Legal Provisions
Central and state government employees are governed by strict conduct rules such as the Central Civil Services (Conduct) Rules, 1964, and equivalent state rules.

• Rule 15 prohibits engaging in trade or business without prior government sanction
  
• This includes being a partner in a firm, director in a company, or running a proprietary business
  
• Violation can lead to disciplinary action, including suspension or dismissal
  
• Applies to all full-time government servants, including officers in administrative, police, judicial, or revenue services
  
• Even “silent” or non-working partnership roles are prohibited without permission
  

Conflict of Interest and Ethical Restrictions
Government officers hold positions of public trust and are expected to remain impartial in their duties.

• Business involvement may compromise decision-making and neutrality
  
• Officers may gain insider information and misuse it for private gain
  
• Ethical rules demand that officers avoid dual loyalties and personal profit from public service
  
• Such involvement may attract corruption and vigilance investigations
  
• Officers must declare their assets and business interests annually for transparency
  

Exceptions and Prior Permission Clause
In rare and justified cases, government officers may seek prior written permission from the competent authority for business involvement.

• Usually granted to spouses or dependents, not the officer themselves
  
• Permission is rarely given for partnerships, more common for passive investments
  
• Officers on deputation to public sector undertakings (PSUs) may have separate guidelines
  
• Retired officers are free to join partnerships unless post-retirement restrictions apply
  
• No officer can be part of a business that deals directly with their own department
  

Post-Retirement Rules and Cooling-Off Periods
Even after retirement, some officers may face restrictions depending on the nature of their post and level.

• Senior bureaucrats may face a cooling-off period (1–2 years) for business involvement
  
• They may not join firms with which they had official dealings before retirement
  
• For some sensitive roles (e.g., defence, finance), rules are stricter
  
• Exemptions may be granted with approval from the relevant government departments
  
• Retired officers must also follow pension-related disclosure norms
  

Legal Consequences of Violation
If a serving officer is found to be a partner in a private firm without approval, it can lead to serious legal action.

• Departmental inquiry and disciplinary proceedings may be initiated
  
• Can result in suspension, termination, or demotion
  
• Violations may attract charges under the Prevention of Corruption Act
  
• Officers may be asked to relinquish business roles and return profits earned
  
• Pension and post-retirement benefits may also be impacted