Supreme Court Questions Continued OBC Reservation for Children of Economically Advanced Families

A bench comprising Justice BV Nagarathna and Justice Ujjal Bhuyan made the observations while hearing a petition challenging a Karnataka High Court judgment that upheld the exclusion of a candidate from reservation benefits on the ground that he belonged to the creamy layer.

Questioning the rationale behind extending reservation benefits across generations despite significant social and economic progress, Justice Nagarathna remarked, “If both parents are IAS officers, why should they have reservations? With education and economic empowerment, there is social mobility. So then again to seek reservation for the children, we will never get out of it.”

The court further observed that reservation was intended to uplift socially and educationally backward communities, but once families attained a certain level of advancement through education, government employment, and stable income, the continuation of reservation benefits required careful scrutiny.

“There has to be some balance. Socially and educationally backward, yes, but once the parents have attained a level because of taking advantage of reservation, if they are both IAS officers, both are in government service, they are very well placed. Social mobility is there. Now they are questioning the exclusion. This also has to be kept in mind,” Justice Nagarathna stated during the proceedings.

The case relates to a candidate belonging to the Kuruba community, classified under Category II(A) among Karnataka’s backward classes, who had been selected for appointment as Assistant Engineer (Electrical) in the Karnataka Power Transmission Corporation Ltd under the reserved category.

However, the District Caste and Income Verification Committee denied him a caste validity certificate after concluding that he fell within the creamy layer category. Authorities assessed the family’s annual income at approximately Rs 19.48 lakh.

The committee noted that both of the candidate’s parents were government employees and that their combined income exceeded the prescribed creamy layer limit applicable under Karnataka’s reservation policy.

During the hearing, advocate Shashank Ratnoo, appearing for the petitioner, argued that salary income alone could not be treated as the determining factor for identifying creamy layer status among government employees. He contended that the exclusion depended primarily on the status and service category of the parents, including whether they belonged to Group A or Group B services, and not merely on salary earnings.

Ratnoo argued that if salary income were made the sole criterion, even lower-ranking government employees such as drivers, clerks, peons, and support staff could eventually be excluded from reservation benefits. He submitted that income derived from salary and agriculture should not be considered while assessing creamy layer eligibility and maintained that only business income or earnings from other independent sources should be taken into account.

He also informed the court that divergent judicial opinions existed on the issue and that the matter required deeper legal examination.

Justice Nagarathna, however, pointed out that the petitioner’s father was drawing a basic salary of Rs 53,900 per month while the mother was receiving a basic salary of Rs 52,650 per month.

In response, Ratnoo relied on a Karnataka government clarification stating that in cases involving state government employees, salary and allowances should not be considered while determining creamy layer status. He further argued that if all forms of income were included in the calculation, there would effectively be no distinction between OBC reservation and reservation under the Economically Weaker Sections category.

The petition stems from a Karnataka High Court division bench judgment that overturned an earlier single judge ruling delivered in favour of the candidate. The division bench held that the rule excluding salary income from creamy layer assessment applied only to reservations under the Union government and not to reservation policies implemented by the Karnataka government.

Referring to Karnataka’s creamy layer policy, the High Court ruled that the candidate’s family income exceeded the applicable ceiling and therefore he was rightly classified under the creamy layer category, making him ineligible for reservation benefits.

The Supreme Court’s observations have once again intensified the national debate surrounding the creamy layer principle, intergenerational reservation benefits, and the balance between social justice and economic advancement within the reservation framework.