Supreme Court Ruling on Creamy Layer Criteria
Background of the Issue
The Supreme Court ruled that income alone cannot be the sole criterion for determining the creamy layer among Other Backward Classes (OBCs). The ruling addressed the equivalence between Public Sector Undertakings (PSUs), private sector employees, and government sector employees. The creamy layer within OBCs are not entitled to reservation benefits. This verdict was reserved on October 30, 2025, by a division Bench of Justice PS Narasimha and Justice R Mahadevan.
Key Points of the Ruling
- The Court emphasized that excluding the creamy layer aims to avoid creating artificial distinctions within the same social class.
- It was deemed unconstitutional to treat similarly placed OBC candidates unequally based on income alone.
- The ruling addressed the discriminatory practice of including PSU and private sector salary incomes for determining creamy layer status, which was not consistent for government sectors.
Historical Context
- The concept of the creamy layer was introduced in the 1992 Indra Sawhney vs Union of India case, known as the Mandal verdict.
Government Job Criteria for Creamy Layer
- Direct recruits in Group-A, or those promoted before the age of 40, are classified in the creamy layer.
- Both parents as Group-B direct recruits also classifies children as part of the creamy layer.
- For the Armed Forces, the creamy layer includes ranks above Lieutenant Colonel.
DoPT Clarifications and Impact
The Department of Personnel and Training (DoPT) issued clarifications on creamy layer criteria in a 1993 Official Memorandum (OM), and further clarified in 2004. The income criterion for those not in government was set at Rs 1 lakh per annum, revised to Rs 8 lakh in 2017.
Implementation and Consequences
- DoPT clarifications were effectively implemented from 2015, impacting around 100 OBC candidates who cleared the Civil Service Examination (CSE) but were rejected due to non-compliance with creamy layer criteria.
- These candidates appealed in various High Courts, including a case by Rohit Nathan in the Madras High Court.
EWS Quota and Income Criteria
The 1993 circular stated that income from salary or agriculture should not count towards the creamy layer test. However, this was not the case for the Economically Weaker Sections (EWS) quota introduced in 2019, which included these incomes.
Beneficiaries of the Ruling
- Candidates taking future exams will benefit, as will those already in service who may be allocated higher ranks or different cadres based on revised OBC status.
- The Court directed the creation of supernumerary posts to accommodate eligible candidates satisfying the non-creamy layer criteria.
