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The Supreme Court is examining the “creamy layer” criteria used in civil service

Anuj Agrawal

The government’s reservation policies, including how the benefactors are identified, is up for scrutiny in the Supreme Court of India. On Monday, J Chelameswar and Prafulla Pant JJ issued notice in a batch of petitions challenging the Department of Personnel and Training (DoPT) policies on identifying the “creamy layer” within Other Backward Classes.

Senior counsel Gopal Subramanium and Sanjay Hegde, assisted by Prateek Chadha and Vikram Hegde appeared for the petitioners.

Along with issuing notice, the bench also noted that selections made under the OBC category in the UPSC Civil Service Examination of 2015 would be subject to the “final result” of these petitions.

The origins of the matter can be traced back to 1993, to the aftermath of the Supreme Court’s Indra Sawhney judgment. Following the judgment, an expert committee was formulated to identify the “creamy layer” within the reserved categories. Members of this creamy layer would be denied the benefits of reservation on the basis that they no longer required affirmative action.

On September 8, 1993, the DoPT issued an Office Memorandum [pdf] laying down the various criteria to be used to determine whether an individual falls in the creamy layer or not.

These criteria included parental income and occupation. For instance, children of those who had been directly recruited as Class I or II employees would form part of the “creamy layer”. Additionally, children of those whose income exceeded the “exemption limit as prescribed in the Wealth Tax Act for a period of three consecutive years” would also fall in the creamy layer.  However, under Category VI of the memorandum, income from salaries or agricultural land was not to be included while calculating this income.

As for the children of PSU employees, the petition says that,

“Children of officers and employees of PSUs etc., in which equivalence of posts cannot or is not found, would be not disentitled under Category II C and thus would have to be evaluated under VI B.”

However, in 2004, the DoPT issued another memorandum [pdf], this one stating that for children of “persons employed in organizations where equivalence or comparability of posts vis-a-vis posts in Government has not been evaluated”, salaries would be taken into account for calculating the income limit.

Which is one of the grounds raised in the petition.

“The supposed clarification that salary is to be considered, to determine if the income of a person employed in a PSU is above the prescribed limit is directly contrary to the mandate of the 1993 OM. It is evident that the 1993 OM clearly provides that salary shall not included within the income limit and as such no clarification is needed.

Salary is not considered in the case of officers of State and Union Government falling under category II A and II B nor in case of employees of State and Central government. However, despite the mandate of 1993 OM that the rule has to be applied mutatis mutandis to the category II C, salary of parents of persons falling under Category II C is included towards the gross income. No reason is provided by Respondent No. 1 for such discriminatory treatment to Persons under II C vis a vis categories II A and II B.”

Not only have the petitioners challenged this unfair classification, but they have also pointed out that the salary limit has been revised only three times in the last twenty-three years. As senior counsel Gopal Subramaniam argued before the Supreme Court, this has led to a situation where,

“Children of persons employed as Mazdoor, Electrician, Clerk etc. were being considered as falling within the creamy layer.”

It is this arbitrary differentiation that had affected the rights of the petitioners; due to crossing the salary limit, the petitioners were denied OBC status while choosing their respective services.

With the Supreme Court now taking cognisance of the matter, Constitutional questions are bound to be raised. And with a subject such as reservations in one of the most competitive selection exercises in the world, expect some battles ahead.

Read the order below.

WP-914-of-2016-order-dated-28.11.2016-1.pdf
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