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TMI Blog1999 (12) TMI 877X X X X Extracts X X X X X X X X Extracts X X X X ..... its Chief Secretary was guilty of contempt but gave a further opportunity to the state to purge the contempt and adjourned the matter to 11.9.1995. It was made clear that if the directions of this Court were not complied with, the Chief Secretary would 'run the risk of being sentenced'. Having sought time for years to appoint a Commission, the Kerala Legislature then suddenly came forward with the Kerala State Backward Classes (Reservation of Appointments or Posts in the Services under the State) Act, 1995 which, in Section 3 declared that "having regard to known facts in existence in the State of Kerala, that there are no socially advanced sections in any Backward Classes who have acquired capacity to compete with forward classes" and that the Backward classes in the State were not "adequately represented" in the services under the State and they would continue to be entitled to reservation under Clause (4) of Article 16 of the Constitution. The provisions of Section 4 continued the existing system of reservation which was in force as per Rules made in 1958 and Section 6 was incorporated as a validating section with retrospective effect. On the ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Backward Classes of Kerala State. Thereafter, objections were filed in this Court by various parties to the said report and that is how the matter has come before us. 4. We do not propose just now to decide the further course of action in the suo motu contempt proceedings in which the State of Kerala represented by its Chief Secretary was held guilty of contempt and was given time to purge the contempt. We make it clear that that issue is kept pending and matter will be processed later, on the basis of the judgment in this case and the directions which we propose to issue at the end of this judgment. 5 . We have heard arguments of Sri Gopal Subramaniam, learned senior counsel as Amicus Curiae and of Sri K.K. Venugopal, learned senior counsel who contended that the Kerala Act 16/95 was unconstitutional and violative of Articles 14 and 16(1) and 16(4). We heard Sri P.Krishna Moorthi, learned senior counsel for the State of Kerala and Sri Rajeev Dhawan, learned senior counsel for the SNDP Yogam, Sri A.N. Rajan Babu, Sri EMS Anam, Ms. Lilly Thomas and Sri V.J. Francis and others who contended that the Act was a valid piece of legislation. Sri K.N. Raval, Additional Solicitor Gener ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the State. 8. Caste only cannot be the basis for reservation. Reservation can be for a backward class citizen of a particular caste. Therefore, from that caste, creamy layer and nonbackward class of citizens are to be excluded. If the caste is to be taken into consideration then for finding out socially and economically backward class, creamy layer of the caste is to be eliminated for granting benefit of reservation, because that creamy layer cannot be termed as socially and economically backward. These questions are exhaustively dealt with by a nine Judge Bench of this Court in Indira Sawhney v. Union of India [1992] Suppl. 3 SCC 217, and it has been specially held that 'only caste' cannot be the basis for reservation. 9 . Inclusion of castes in the list of Backward classes cannot be mechanical and cannot be done without adequate relevant data. Nor can it be done for extraneous reasons. Care should be taken that the forward castes do not get included in the backward castes list. In Indira Sawhney, Pandian, J. observed (para 174 SCC) that before a conclusion is drawn that a caste is backward or is inadequately represented in the services, "the existence of circum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Article 16(4). Identification of the backward classes can certainly be done with reference to castes among, and alongwith, other groups, classes and sections of people. One can start process with the castes, wherever they are found, apply the criteria (evolved for determining backwardness) and find out whether it satisfies the criteria. If it does what emerges is a "backward class of citizens" within the meaning of and for the purposes of Article 16(4). Similar process can be adopted in the case of other occupational groups, communities and classes, so as to cover the entire populace. The central idea and overall objective should be to consider all available groups, sections and classes in society. Since caste represents an existing, identifiable social group class encompassing an overwhelming majority of the country's population, one can well begin with it and then go to other groups, sections and classes. 12. Court further considered in Paragraph 800 and held as under: ...while answering Question 3(b), we said that identification of backward classes can be done with reference to castes along with g other occupational groups, communities and classes. We did no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under question 10 (paras 843, 844). This is what the learned Judge declared: There are sections among the backward classes who are highly advanced, socially and educationally and they constitute the forward section of that community. These advanced sections do not belong to the true backward class. They are "as forward as any other forward class member" (para 790). "If some of the members are far too advanced socially (which in the context necessarily means economically and may also mean educationally), the connecting thread between them and the remaining" class snaps. They would be misfits in the class" (para 792). The learned Judge said: After excluding them alone, would the class be a compact class. In fact, such exclusion benefits the truly backward. 19 . A line has to be drawn, said the learned Judge, between the forward in the backward and the rest of the backward but it is to be ensured that what is given with one hand is not taken away by the other. The basis of exclusion of the "creamy layer" must not be merely economic, unless economic advancement is so high that it necessarily means social advancement, such as where a member becom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and must be excluded. Q Creamy layer has to be excluded and 'economic criteria' are to be adopted as an indicium or measure of social advancement. (Para 860, sub para 5). The socially advanced persons must be excluded, (para 861 (b)). That is how Jeevan Reddy, J. summarised the position. 20. Sawant, J. too accepted (para 553 of SCC) that "at least some individuals E and families in the backward classes, however small in number gain sufficient means to develop "capacities to compete'" with others in every field. That is an undeniable fact. Social advancement is to be judged by the 'capacity to compete' with forward castes, achieved by the members or sections of the backward classes. Legally, therefore, these persons or sections who reached that level are not entitled any longer to be called as part of the backward class whatever their original birthmark. Taking out these "forwards" from the "backwards" is 'obligatory' as these persons have crossed the Rubicon (para 553-554). On the crucial question as to what is meant by "capacity to compete", the learned Judge explained (para 522) that if a person moves from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elf and three others), Sawant and Sahai JJ.- (i.e. six learned Judges out of nine) -, they specifically refer to those in higher services like IAS, IPS and All India Services or near about as persons who have reached a higher level of social advancement and economic status and therefore as a matter of law, such persons are declared not entitled to be treated as backward. They are to be treated as creamy layer "without further inquiry". Likewise, persons living in sufficient affluence who are able to provide employment to others are to be treated as having reached a higher social status on account of their affluence, and therefore outside the backward class. Those holding higher levels of agricultural land holdings or getting income from property, beyond a limit, have to be excluded from the backward classes. This, in our opinion, is a judicial "declaration" made by this Court. 25. The submission of Sri Rajeev Dhawan for the S.N.D.P. Yogam that the above separate judgments contain mere illustrations and do not contain any declaration of law cannot, in our opinion, be accepted. Counsel also relied upon observations in the judgment of Jeevan Reddy, J. to the effec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bject to such a reasonable revision in the norms, if any, periodically, the norms whether laid down by the Central Government or the State Governments must apply not only for the immediate present but also for the future. This, in our view, was the declaration of law made in Indira Sawhney and in Ashok Kumar Thakur in relation to identification and exclusion of creamy layer. 27 . So far as the directions in Indira Sawhney are concerned, they are that the Central and State Governments are obliged to create separate bodies which will identify the creamy layer in the backward classes within a time frame. Point 1 is decided accordingly. POINT 2 and 3: These two points are crucial to the case. Under these points, we shall now deal with the validity of the Kerala Act (Act 16/95). (i) Equals and unequals, twin aspects: As the 'creamy layer' in the backward class is to be treated "on par" with the forward classes and is not entitled to benefits of reservation, it is obvious that if the 'creamy layer' is not excluded, there will be discrimination and violation of Articles 14 and 16(1) inasmuch as equals (forwards and creamy layer of backward classes) cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... layer principle laid down in Indira Sawhney, cannot be ignored as done by Section 6 of the said Act. We shall elaborate these aspects later. If under the guise of elimination of the 'creamy layer', the legislature makes a law which is not indeed a true elimination but is seen by the Court to be a mere cloak, then the Court will necessarily strike down such a law as violative of principle of separation of powers and of Articles 14, 16(1) and Article 16(4). (iii) Ashok Kumar Thakur a case of unrealistic elimination but Central Government's O.M, dated 8.9.93 approved: 30. Such a case of unrealistic elimination of creamy layer came up before this Court from Bihar and Uttar Pradesh and we shall refer to the same. This happened in Ashok Kumar Thakur v. State of Bihar and Ors. AIR1996SC75 , already referred to. There the position was that unrealistically high levels of income or holding or other conditions were prescribed by the Legislatures of Bihar and Uttar Pradesh under the Bihar Reservation of vacancies in Posts and Services (Amendment) Ordinance, 1995 (5 of 1995) and Schedule II read with Section 3(b) of the U.P. Public Services Reservation for Schedules Castes and Sch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the criteria fixed in the O.M. were "in conformity with the law laid down by this Court in Mandal case" and that the Court had no hesitation in approving the said criteria as being reasonable. In the light of the criteria so approved, this Court considered the validity of the Bihar and U.P. Legislations and held that the unreasonably high limits or other norms fixed by the Bihar and U.P. Legislatures were "contrary to the guidelines laid down by this Court in Mandal Case" as they would not result in the elimination of the creamy layer. It was pointed out that the conditions laid down by the States of Bihar and U.P. had no "nexus" with the object sought to be achieved. Since the conditions were not severable, the criteria laid down in each of the legislations as a whole were struck down. The Court held: (see para 17) The Backward class under Article 16(4) means the class which has no element of 'creamy layer' in it. It is mandatory under Article 16(4) - as interpreted by this Court - that the State must identify the 'creamy layer' in a backward class and thereafter, by excluding the 'creamy layer' extend the benefit of reserv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State are still not adequately represented in the services under the State and they continue to be entitled to reservation under Clause (4) of Article 16 of the Constitution. (4) Reservation of appointments or posts in the services under the Stale: Notwithstanding anything contained in any law or in any judgment, decree or order of any court or other authority having regard to the social and educational backwardness of the Backward Classes of citizens, the system of reservations as in force on the date of commencement of this Act, as laid down in Rules 14 to 17 of Part II of the Kerala State and Subordinate Services Rules, 1958, in appointments and posts in the services under the State for the Backward Classes of citizens shall continue as such, for the present. (5) Additional function of the Commission : The Commission shall, in addition to the functions already conferred under the Kerala State Commission for Backward Classes Act, 1993 (11 of 1993) evaluate from time to time the degree of backwardness of the Backward Classes, and shall submit periodical reports to the Legislative Assembly of the State. (6) Validation-Notwithstanding anything contained in any judgment, decr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommittee should go into the question but that instead, it was suddenly decided on 27.7.95 that the "existing Q system be continued". Then Act 16/95 was passed on 31.8.95 to give effect to that decision. The Act received the assent of the Governor on 2.9.95 and became effective retrospectively from 2.10.1992, thus allowing existing reservations to continue with full force. In effect no creamy layer was identified. As per Sub-clause (a) of Section 3 of the Act it was declared that in view of "known facts", the Legislature was of the view that "no section of any backward class in the State of Kerala who had acquired capacity "to compete with forward classes". As per Clause (b), it was stated that Backward Classes were not still adequately represented in the public services of the State. Section 4, therefore, continued the 1958 scenario of Backward Classes without excluding the creamy layer and Section 6 spoke of retrospective validation. (vi) Legislative declaration of facts is amenable to scrutiny by Court: 35 . Before we go into the validity of Sub-clause (a) and (b) of Section 3, it is necessary to find out if the legislative declaration of &quo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to in Section 3 were indeed non-existent. (vii) Sub-clause (a) of Section 3: Did the Kerala Legislature have any facts before it to say in effect that there was no creamy layer? 38. Sub-clause (a) of Section 3 states that according to "known facts" the backward classes in the State were not having the capacity to compete with forward classes i.e., in effect, there is no creamy layer in the Kerala State. 39. But Aldous Huxley said: Facts do not cease to exist because they are ignored. (A Note on Dogmas) The words in Sub-clause (a) of Section 3 are obviously drawn from the judgment of Sawant, J. in Indira Sawhney which refers to "capacity to compete with forward classes". 40 . We shall, therefore, have to examine whether the legislative declaration in Section 3 of the Act that there is, in effect, no creamy layer in the State of Kerala is one made by ignoring facts which do exist. We shall now refer to various facts and circumstances as they exist to disprove the statement made in Section 3 of the Act: (a) The Kerala State initially requested this Court for extension of time to appoint a Commission to identify the creamy layer. It, in fact, created ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ature cannot, in our opinion, refuse to accept this declaration of law nor can it declare anything to the contrary. 41. In the judgment of six learned Judges in Indira Sawhney, as stated earlier, there is a specific declaration of law that the children of IAS, IPS and other All India Services in the Backward Classes are creamy layer and this is true "without further inquiry". These persons are to be deemed, in law and, in fact, to have reached such a level of social advancement that they cease to belong to the backward class. The judgment also refers to a classification of "affluent" sections identified by way of income or property holding. (f) Further, in Ashok Kumar Thakur it was held as a matter of law that certain broad categories mentioned in the O.M. of the Central Govt. dated 8.9.93 belong to the creamy layer. There was no answer from the State of Kerala as to why the same categories as mentioned in Indira Sawhney or those mentioned in the O.M., as approved in Ashok Kumar Thakur could not be declared as creamy layer, subject to any realistic modification of the income or holding levels, if need be. It was not the case of the State before us that these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e declaration in Sub-clause (a) of Section 3 made by the legislature has no factual basis in spite of the use of the words 'known facts'. The facts and circumstances, on the other hand, indicate to the contrary. In our opinion, the declaration is a mere cloak and is unrelated to facts in existence. The declaration in Section 3 (a) is, in addition, contrary to the principles laid down by this p Court in Indira Sawhney and in Ashok Kumar Thakur. It is, therefore, violative of Articles 14 and 16(1) of the Constitution of India. Sub-clause (a) of Section 3 is, therefore, declared unconstitutional. (viii) Sub-clause (b) of Section 3: Inadequate representation: Section 3(b) mixes up two different concepts: 46. Sub-clause (b) of Section 3 states that there is no adequate representation of the backward classes in the services of the State of Kerala. This is given as a reason for not excluding the creamy layer. 47. In our view, the Kerala Act has mixed up two different concepts in this E Subclause (b) of Section 3. Article 16(4), it will be seen, is an enabling provision which permits the State to provide reservation for Backward Classes if, in the opinion of the State, such rese ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... once the creamy layer is excluded from backward classes the non-creamy layer in that backward class is not able to secure adequate representation even within the quota, in public services because its members are not reaching the prescribed level of qualification or standards for recruitment, - can that be a ground for non-exclusion of the creamy layer as contended by the State? 52. It is true there is no specific constitutional provision in relation to the need for maintenance of 'efficiency of administration' so far as backward classes are concerned (such as the special provision in Article 335 in the case of Schedule castes and Schedule Tribes). But such a principle of efficiency of administration is, in our opinion, equally paramount and is implied in Articles 14 and 16 of the Constitution even so far as backward classes are concerned. In Indira Sawhney, Sawant pointed out (para 434 of SCC) that while Article 16(4) is an enabling provision, Article 335 is in mandatory language. Further though there is no specific provision in regard to Backward Classes, the same principle underlying Article 335 is applicable to Backward Classes. Sawant, J. stated (para 434 of SCC): It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iminating the creamy layer and must also be held to be unconstitutional and violative of Articles 14, 16(1) and 16(4) of the Constitution. 57. Thus, Sub-clause (a) and (b) of Section 3 are both declared unconstitutional. (x) Section 4: 58. We next come to Section 4 of the Act. The non-obstante clause in Section 4 is obviously intended to get over Indira Sawhney and Ashok Kumar Thakur. The crucial words of the section are: "having regard to the social and educational backwardness of the backward classes" in the State of Kerala - as in force on the date of the commencement of the Act (i.e. 2.10.1992). 59. Now, "backward classes" have been defined in the Act as those referred to in Section 2(b) of the Act. That definition in its turn takes us to the enumeration of Backward Classes made in 1958 in List III of Schedule to part I of the Kerala State and Subordinate Services Rules, 1958 framed under the proviso to Article 309 of the Constitution. In other words, Section 4 provides for the continuance of reservation for the Backward Classes as they stood in 1958 ignoring the directives of this Court in 1992 in Indira Sawhney for exclusion of creamy layer'. 60. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the basic cause of unconstitutionally - is, as already stated, ineffective and will be invalid. Thus, Section 6 is also unconstitutional. 64. For the aforesaid reasons, we declare under Points 2 and 3 that the provisions of Sections 3, 4 and 6 of the Act are unconstitutional and violative of Articles 14, 16(1) and 16(4) of the Constitution of India. and of the law laid down by this Court. But with a view to relieve any hardship, we propose to issue certain directions under Point 4 and 5. Our decision on points 2 and 3 will be subject to what we propose to direct under point 5 and 6. 65. Points 2 and 3 are decided accordingly. 66. Point 4: 67. Article 14: (and Article 16 which is a facet of it) is part of the basic structure of the Constitution of India: 68. The preamble to the Constitution of India emphasises the principle of equality as basic to our constitution. In Keshavananda Bharati v. State of Kerala AIR1973SC1461 , it was ruled that even constitutional amendments which offended the basic structure of the Constitution would be ultra vires the basic structure. Sikri, CJ. laid stress on the basic features enumerated in the preamble to the Constitution and said that there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate of Kerala. The Report is a detailed one and runs into 114 pages. The Committee invited suggestions and representations from the public as well as from the organisations representing the Backward Classes by newspaper publications in December 1996, in English and Malayalam. The Committee also gave personal hearing to various individuals, bodies and organisations. It received 596 representations/suggestions till 15.1.97 by the due date and 177 representations after the due date. Most of the parties before us had represented before the said Committee. The State of Kerala did not file any representation before the High Level Committee, though a request was made on 13.1.97 to permit it to give suggestions. The State Government placed the report of the subject's Committee before the High Level Committee and the said Committee went into the provisions of the Bill which led to the 1995 Act. The Subjects-Committee of the Legislature and other Committees and the organisations which contended that there was no creamy layer in the Backward Classes in the State relied mostly upon Section 3 of the 1995 Act. Organisations which contended that there was a creamy layer pointed out that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctions and 16. 16 lakhs in High Schools Sections - in all ,-. 56.27 lakhs. During this period, 17,250 were in vocational schools in 1995-96. There were again, 211 colleges in Kerala in 1996. In 1996,92,304 boys and 1.17 lakh girls were studying in pre-degree and 48,635 boys and 79,638 girls in degree classes and 2954 boys and 8206 girls in P.O. classes. According to the High Level Committee all these groups in schools and colleges contained backward classes candidates. Statistics in Engineering and Medical Colleges and Nursing were also given. 76 . Thereafter, the Committee referred to the Central Government's O.M. dated 8.9.93 in para 22F (i) and to Ashok Kumar Thakur. In para 22F (v), it was said that as in the said O.M, so in Kerala, the rule of exclusion of creamy layer was not to be applied to Artisans or those engaged in hereditary occupations, callings like potters, washermen, barbers etc. The list of such occupations prepared by the Kerala Artisans Development Corporation Ltd. was accepted. Persons traditionally engaged in fishing operations were also excluded in para 22F (vii). The Committee referred in para 28 to various principles settled in Indira Sawhney. 77. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sector, Government companies and autonomous bodies etc. 80 . In the Schedule at Pages 13-17, which is the crucial provision, the method adopted is similar to that in the Central Governments O.M. dated 8.9.93. First, Constitutional posts are referred to. These include among others Judges of the High Court, Supreme Court, Chief Ministers, Council of Ministers etc., Former Chief Ministers and former Council of Ministers as well. These in all, are in 19 categories. Then conies the Service category, and the Central pattern is followed, referring to "Parents both or either" being in Group I and Group B posts; reference is made to those in Armed forces and Para Military forces at various higher levels; Professional Classes and Trade and Industry were then referred to as follows: persons coming within wealth/means/income group prescribed in category VI, apart from their social status as prescribed in the respective professions. and contain sub-categories in paras (i) to (vi). Income level is fixed at ₹ 1.50 lakhs gross for individuals and ₹ 20 lakhs for company and trusts in an year. Societies and Chief Executives/Chair persons of Cooperative Societies are also i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Committee's Report. Counsel virtually conceded that no material was placed in any of the objections filed in this Court to the guidelines/norms in the Report except to say that the Kerala Act of 1995 was a complete answer to the points raised in the Report in favour of identification of the creamy layer. Some have raised points which are already covered by what we have said under Points 1, 2 and 3. In fact, we may make it very clear that no objection of any substance was placed before us by any counsel to contend that the guidelines or norms fixed by the High Level Committee were wrong. Arguments of a very general nature saying that creamy layer ought not be excluded, were advanced. We, therefore, hold that there is nothing in the objections filed by the parties which requires to be specifically dealt with. 83. In the result, we accept the Justice Joseph Committee's Report in toto subject to the addition of communities and sub-castes as pointed out in the affidavit of the State dated 16.1.98, referred to above. 84. The next question is as to the further directions that we have to give: 85. When the State was found guilty of deliberately violating orders of this Court and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... where appointment orders have not been issued to the members of the Backward classes and for all future selections in public service as stated in the Report. (The five communities E referred to in the affidavit of the Chief Secretary dated 16.1.98 shall also be treated as Backward subject to the guidelines and norms fixed by the Committee). It will be obligatory to implement the Report, as so modified, in the Government Departments of Kerala / Organisations/ Institutions/Public Sector Undertakings/Government owned Companies/Co-operative Societies/ Autonomous Bodies , as stated in the Report, wherever the principles of reservation embodied in Article 16(4) or Rules 14 to 17 of Part II of the Kerala State and subordinate Service Rules, 1958 are applicable. It shall be necessary for the candidates belonging to the Backward Classes to file the certificates as envisaged in the Report and satisfy the employer that he or she does not belong to the creamy layer. The income limits and property holdings as mentioned in the Schedule to the said Report will be applicable from today. The exclusion of certain occupations/communities etc., shall however be as specified in the Report. Any violatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dy been held guilty of contempt. 92 . This attitude and action of the State of Kerala has unfortunately resulted in allowing the 'creamy layer among the backward classes in the State of Kerala to continue to grab the posts in the services in government, public sector etc., even after Indira Sawhney and get away with the same. The result is that the really backward among the backward classes have been deliberately deprived by the State, - of their legitimate right to these posts which would have otherwise obviously gone to them. To us it appears to be rather anomalous that while the Governments declare endlessly that they will see to it that benefits of reservations really reach the needy among the backwards-the very action of the Governments both on the executive side and on the legislative side, deliberately refusing to exclude the creamy layer and in indiscriminately including more castes in the backward classes list are leading to a serious erosion of the reservation programme. The sudden Cabinet decision of the State of Kerala not to appoint a Commission to identify the creamy layer as promised but to pass the impugned law was nothing but an attempt to perpetuate the cream ..... X X X X Extracts X X X X X X X X Extracts X X X X
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