2008 (4) TMI 775 - SC - Indian Laws

Exclusion of creamy layer - Validity of 93rd Amendment to the Constitution of India - whether Article 15(5) would be unconstitutional on the ground that it violates the basic structure of the Constitution by imposing reservation in respect of private unaided educational institutions - members belonging to other backward classes who get selected in the open competition field on the basis of their own merit should be counted against the 27% quota reserved for other backward classes under an enactment enabled by Article 15(5) of the Constitution, for consideration in an appropriate case - HELD THAT - This Court has held that clause (4) of Article 15 is neither an exception nor a proviso to clause (1) of Article 15. Clause (4) has been considered to be an instance of classification inherent in clause (1) and an emphatic restatement of the principle implicit in clause (1) of Article 15 (see State of Kerala v. N.M. Thomas 1975 (9) TMI 176 - SUPREME COURT . Clauses (1) and (2) of Article 15 bar discrimination. Clause (5) was added by Constitution (Ninety-third Amendment) Act, 2005 . Each of these three enabling provisions operate independent of each other. The opening words Nothing in this article occurring in each of these clauses (3), (4) and (5) obviously refer to clauses (1) and (2) of Art. 15 and not to the other enabling clauses. Clauses (3), (4) and (5) of Article 15 are not to be read as being in conflict with each other, or prevailing over each other, but are to be read harmoniously. The need for exclusion of creamy layer - Section 3 of Act 5 of 2007 mandates reservation of seats in central educational institutions for other backward classes to an extent of 27%. It is contended that the term backward classes in Article 16(4) is much wider than socially and educationally backward classes of citizens occurring in clauses (4) and (5) of Article 15. Article 15(4) provides that nothing in that Article or in clause (2) of Article 29 shall prevent the State from making any special provision for the advancement of any socially and educationally backward class of citizens or for Scheduled Castes and Scheduled Tribes. It is submitted that as clause (5) of Article 15 does not override or exclude Article 29(2), any law made in exercise of power under Article 15(5) will be subject to Article 29(2), and consequently there cannot be any affirmative action by way of reservation on the ground of caste alone. The decision of nine Judges in Indra Sawhney v. Union of India 1992 (11) TMI 277 - SUPREME COURT . This Court held that the use of the word class in Article 16(4) refers to social class, and that reservation under Article 16(4) is in favour of a backward class and not a caste. It held that backward class of citizens contemplated in Article 16(4) is not the same as socially and educationally backward classes referred to in Article 15(4), but much wider. It held that there was no reason to qualify or restrict the meaning of the expression backward class of citizens by saying that it means only those other backward classes who are situated similarly to Scheduled Castes and/or Scheduled Tribes. The need for exclusion of creamy layer is reiterated in the subsequent decisions of this Court in Indra Sawhney v. Union of India (II) 1996 (11) TMI 487 - SUPREME COURT , M. Nagaraj v. Union of India 2006 (10) TMI 420 - SUPREME COURT . When Indra Sawhney has held that creamy layer should be excluded for purposes of Article 16(4), dealing with backward class which is much wider than socially and educationally backward class occurring in Article 15(4) and (5), it goes without saying that without the removal of creamy layer there cannot be a socially and educationally backward class. Therefore when a caste is identified as a socially and educationally backward caste, it becomes a socially and educationally backward class only when it sheds its creamy layer. Any provision for reservation is a temporary crutch. Such crutch by unnecessary prolonged use, should not become a permanent liability. It is significant that Constitution does not specifically prescribe a casteless society nor tries to abolish caste. But by barring discrimination in the name of caste and by providing for affirmative action Constitution seeks to remove the difference in status on the basis of caste. When the differences in status among castes are removed, all castes will become equal. That will be a beginning for a casteless egalitarian society. Agree that the petitions shall stand disposed of in the manner stated by the learned Chief Justice.

Summary

Issues Involved:
1. Validity of the 93rd Amendment to the Constitution of India.
2. Validity of the Central Educational Institutions (Reservation in Admissions) Act, 2006 (Act No. 5 of 2007).
3. Parameters for determining the creamy layer in respect of OBCs.
4. Validity of 27% reservation for OBCs under Act 5 of 2007.

Issue-wise Detailed Analysis:

A. Validity of 93rd Amendment to the Constitution of India:
The judgment concurs with the view that clause (5) of Article 15 is valid concerning state-maintained and aided educational institutions. The court leaves open the question of its constitutionality regarding private unaided educational institutions. It is noted that Article 15(5) does not render Article 15(4) inoperative or ineffective. The judgment emphasizes that clauses (3), (4), and (5) of Article 15 should be read harmoniously and not in conflict with each other.

B. Validity of Central Educational Institutions (Reservation in Admissions) Act, 2006 (Act No.5 of 2007):
The judgment agrees that identifying other backward classes (OBCs) solely based on caste is unconstitutional. It asserts that the failure to exclude the 'creamy layer' from reservation benefits renders the Act unconstitutional. However, the Act is valid if the definition of OBCs is clarified to exclude the creamy layer. Additionally, the judgment supports the view that the Act is not invalid due to the absence of a prescribed time limit for caste-based reservation but suggests a review after ten years to assess changes in circumstances.

C. Parameters for determining the creamy layer in respect of OBCs:
The judgment aligns with the application of the Office Memorandum dated 8.9.1993 of the Government of India for determining the creamy layer among OBCs.

D. Validity of 27% reservation for OBCs under Act 5 of 2007:
The judgment affirms that the 27% reservation for OBCs is not illegal. However, it leaves open the question of whether OBC members who secure admission based on their merit in open competition should be counted against the 27% reserved quota.

Additional Analysis:

Whether Article 15(5) renders Article 15(4) ineffective:
The judgment clarifies that Article 15(4) is not an exception to Article 15(1) but an instance of classification inherent in it. Clauses (3), (4), and (5) of Article 15 operate independently and should be read harmoniously. The opening words "Nothing in this article" in each of these clauses refer to clauses (1) and (2) of Article 15, not to the other enabling clauses.

The need for exclusion of creamy layer:
Section 3 of Act 5 of 2007 mandates a 27% reservation for OBCs in central educational institutions. The term "other backward classes" refers to socially and economically backward classes determined by the central government. The judgment emphasizes that caste cannot be the sole or dominant test for determining backwardness. It reiterates that the creamy layer must be excluded to form a compact class that can be termed as socially and educationally backward. The exclusion of the creamy layer prevents advanced sections from appropriating reservation benefits, ensuring true backward classes receive the intended support.

Implications of caste-based reservations:
The judgment acknowledges the historical divisiveness of caste in India and the necessity of reservations as a temporary measure to uplift socially and educationally backward classes. However, it warns against the prolonged use of reservations, which could perpetuate caste divisions and hinder societal progress. The judgment advocates for periodic reviews of reservation policies to ensure they remain relevant and effective in achieving an egalitarian society.

Conclusion:
The petitions are disposed of in accordance with the views expressed by the learned Chief Justice, affirming the validity of the 93rd Amendment and the Central Educational Institutions (Reservation in Admissions) Act, 2006, with the stipulation of excluding the creamy layer and periodic reviews of reservation policies.