NEWS: Supreme Court ruled that parental income alone cannot determine creamy layer status for Other Backwards Classes (OBCs)

ABOUT

• At presentà Children of government employeesàevaluated based on parental rank, whereas children of PSU and private sector employees are assessed solely by parental salary.
• Treating children of PSU/private employees differently from those of government employeesà violates the Right to Equality under Articles 14, 15, and 16.

Arguments in Favour

• Rank-based identificationà Measures social standing more accurately than income alone.
• Long serviceà Can raise a lower-level employee’s salary without changing social position.
• Uniform post-based criteria across all employers ensures the fair evaluation of every OBC candidate.

Concerns and Criticisms

• The private sectorà Lacks a standardised rank hierarchy, making it difficult to verify post-based classification.
• Rank-based criteriaà Ignores the current economic reality, where income largely determines access to education.
• High-income private-sector familiesà may crowd out economically weaker OBC candidates from reserved seats.

Creamy Layer

• Creamy layer principle-à Identifies and excludes the socially and economically privileged members of OBCs from reservation benefits.
• Supreme Courtà Established this principle in Indra Sawhney v. Union of India (1992) to ensure reservation benefits reach the most marginalised.
• Considered a creamy layerà if its annual income exceeds ₹8 lakh for three consecutive years.
• Only income from business, profession, property, or investments counts toward the threshold. Salary and Agricultural income are excluded.
• Children of parents in Group A / Class I posts or those promoted to Group A before age 40 are automatically excluded from reservation benefits.