Section 6 in The Chennai Corporation Servants Conduct Rules, 1968
6. Investments, lending and borrowing.
(1)No Corporation servant shall speculate in any investment.Explanation. - The habitual purchase or sale of securities of a notoriously fluctuating value shall be deemed to be speculation in investments within the meaning of this sub-rule.(2)No Corporation servant shall make or permit his wife or any other member of his family to make any investment likely to embarrass or influence him in the discharge of his official duties.(3)If any question arises whether a security or investment is of the nature referred to in sub-rule (1) or sub-rule (2), the decision of the Government thereon shall be final.(4)No Corporation servant shall, except with the previous sanction of the Government, lend money to any person possessing land or valuable property within the local limits of his authority or at interest to any personProvided that a Corporation servant may make an advance of pay to a private servant, or give a loan of a small amount free of interest to a personal friend or relative, even if such person possesses land or valuable property within the local limits of his authority.(5)No Corporation servant shall, save in the ordinary course of business with a bank or a firm of standing, borrow money from or otherwise place himself under pecuniary obligation to any person within the local limits, of his authority, or any other person, with whom he is likely to have official dealing nor shall he permit any member of his family, except with the previous sanction of the Government, to enter into any such transaction :Provided that a Corporation servant may accept a purely temporary loan of small amount, free of interest, from a personal friend or relative or operate a credit account with a bonafide tradesman.(6)When a Corporation servant appointed or transferred to a post of such a nature as to involve him in the breach of any of the provisions of sub-rule (4) or sub-rule (5), he shall forthwith report the circumstances to the Government and shall, thereafter, act in accordance with such orders as may be passed by the Government.(7)Corporation servants may become members of, and place deposits in,non-agricultural co-operative societies including the [Tamil Nadu] [Substituted for the word 'Madras' by the Tamil Nadu Adaptation of Laws Order, 1969 as amended by the Tamil Nadu Adaptation of Laws (Second Amendment) Order, 1969.] State Cooperative Bank Limited and other Central Banks.(8)Corporation servants may place deposits in, and purchase debentures of, the [Tamil Nadu] [Substituted for the word 'Madras' by the Tamil Nadu Adaptation of Laws Order, 1969 as amended by the Tamil Nadu Adaptation of Laws (Second Amendment) Order, 1969.] Co-operative Central Land Mortgage Bank Limited, but shall not hold any office therein or take any part in the management thereof.(9)A Corporation servant may, with the previous sanction of the Head of the Department, become a member of a land mortgage bank or house mortgage bank, provided that he already owns land or house, as the case may be, in the area within the jurisdiction of such bank, but shall not hold any office therein or take any part in the management thereof.(10)If a Corporation servant is appointed or transferred to any area within the jurisdiction of a land mortgage bank or house mortgage bank of which he is a member, he shall, at once, bring the fact to the notice of his immediate superior who, if he has authority to do so, may re-post the Corporation servant to an area outside the jurisdiction of that bank, or if he has no authority to do so, submit the case for the orders of the officer having such authority.(11)Corporation servants may take out insurance policies from, and become members, of the South India Co-operative Insurance Society Limited.(12)Corporation servants may become members of Co-operative House' Building Societies.Explanation. - Co-operative house building societies aforesaid shall include all types of co-operative societies whose object is the construction of houses for their members or the grant of loans for such construction by their members.(13)Notwithstanding anything contained in this rule, a Corporation servant may borrow money from a co-operative society of which he is a member, provided that where the borrowing is on personal security, the surety shall be of a status equal to or higher than that of the borrower.(14)The prohibition against lending and borrowing of money applied to all loans, credits, advances, supply of articles or accommodation at unduly low rates or for insufficient consideration and to sales of property for inordinately low prices.(15)The fact that a Corporation servant lending money is acting as an executor, administrator or as a trustee without profit or advantage to himself shall not exempt him from the operation of this rule.(16)A Corporation servant who belongs to a joint Hindu family carrying on the business of money lending as an ancestral profession is exempted from the prohibition, provided he takes no active part in the business and is not employed in a place in which the business of the joint Hindu family is carried on.(17)A Corporation servant engaged in teaching is prohibited from having pecuniary relations with any pupil or ex-pupil or parent or guardian of any pupil or ex-pupil or with staff or establishments of the school or college in which he is employed.
