FAQ on Commercial Employment after Retirement or Resignation

Voluntary retirement of IPS and IFS is dealt by the respective cadre controlling authorities i.e. Ministry of Home Affairs and Ministry of Environment and Forests.

As per rule 26 of the All India Services (Death-cum-Retirement Benefits) Rules, 1958 a pensioner shall not accept any commercial employment before the expiry of one year from the date of his retirement, except with the previous sanction of the Central Government. Further, the previous sanction may be granted by the State Government concerned on whose cadre the member of the service is borne and who is not holding a post higher than a post in the pay scale of Rs.22400-24500/- (pre revised) and has not worked under the Central Government during the preceding three years prior to his retirement from the service.

Aforesaid rule also provides that if a pensioner accepts a commercial employment without such sanction, it shall be competent for the Central Government to declare by an order in writing that he shall not be entitled to the whole or such part of the pension and for such period as may be specified in the order. However, no such order shall be made without giving the pensioner concerned an Opportunity of showing cause against such declaration.

For permission of the Central Government under Rule 26 of AIS (DCRB) Rules, 1958, retired AIS officer is required to apply in prescribed profarma schedule ‘L’ for taking up post retirement commercial employment.

The procedure as follows is adopted in processing applications for grant of permission under Rule 26 of AiS(DCRB), Rules, 1958 to accept post retirement commercial employment:-

On receipt of the request from retired IAS Officer in prescribed profarma Schedule L, comments of concerned Ministries/Departments /State Governments where the officer had served during the period of three years prior to his/her retirement, are sought. They are required to give their comments taking into consideration the factors given in Rule 26(3) of AIS(DCRB) Rules, 1958. Rule 26 (3) of AIS(DCRB) Rules, 1958 provides that in granting or refusing permission under sub-rule (1) or sub rule (2) to a pensioner for taking up any employment, the Central Government or the State Government, as the case May be, shall have the following factors, namely:-

(i) whether the organisation the pensioner proposes to join has any conflict of interest or activities prejudicial to India’s foreign relations, national security and domestic harmony; and whether the organisation is undertaking any form of intelligence gathering;

(ii) whether the pensioner has been privy to sensitive or strategic information in the last three years of his service which is directly related to the areas of interest or work of the organisation which he proposes to join or the areas in which he proposes to practice/consult,

(iii) whether there is conflict of interest between policies of the office(s) held by the pensioner during the last three years and the interest represented or work undertaken by the organisations he proposes to join. Such conflict of interest, however, should not be interpreted Narrowly to mean normal economic competition with Government or its Undertakings,

(iv) whether the service record of the pensioner is clear, particularly with respect to integrity and dealings with Non-Government Organisations,

(v) the emoluments offered by the proposed employer to the pensioner and whether the proposed emoluments and pecuniary benefits are far in excess of those currently prevalent in the Industry.(The word “far in excess” should not be narrowly interpreted to cover increases in such benefits that may be result of buoyancy in the industry or in the economy as a whole): and

(vi) any other relevant factors.”

Comments of concerned Ministries/ Departments/ State Governments are mandatory.:

Procedure for due diligence:-

(i) Due diligence concerning organisation :

Comments with regard to the Organisation (registered under the companies act) the applicant proposes to join are sought from Ministry of Corporate Affairs and D/o Revenue. Ministry of Corporate Affairs is required to examine in the light of instances of corporate misgovernance etc. They are also required to Clarify if the emoluments and pecuniary benefits offered by the proposed employer to the pensioner are far in excess of those currently prevalent in the industry. Department of Revenue is required to examine the proposal from the angels of income-tax, customs, enforcement etc.

In case the organization is not based in India and/or is not controlled by Indian citizens, the comments of Ministry of External Affairs and Internal Security in MHA are sought on the issue whether the organization the pensioner proposes to join has any conflict of interest or activities prejudicial to India’s foreign relations, national security and – domestic harmony, and whether the organization is undertaking any form of intelligence gathering.

(ii) Due diligence concerning applicant:

Vigilance status of the applicant is obtained.

Views/comments of the Ministries/ Departments in which the applicant was posited in the three years prior to retirement are sought under Rule 26(3) of AlS(DCRB) Rules, 1958.

b) they are not substantially funded by the Central and State Governments:

c) the Central or State Governments do not have powers to give’ them directions: and

d) they are not companies (except section 25 companies) registered under the Registration of Companies Act.

Provided further that deputation to section 25 companies shall be allowed only on standard government deputation terms.

Deputations are allowed only to officers who have served at least 9 years in the cadre, are clear from vigilance angle and have not dealt with the borrowing organisation in the last five years. Neither the officer nor any of his/her blood relations should have been connected with the setting up of or Management of the organisation. There will be a mandatory cooling off after every period of deputation under Rules 6(1) and 6(2) (ii).