Parent income alone cannot be the only criterion for determining the OBC ‘Creamy Layer’

(Creamy Layer: The economically and socially advanced section within the OBC (Other Backward Classes) community is called the creamy layer. This group does not receive the benefit of reservation.)

New Delhi – In a batch of civil appeals arising out of separate orders passed by the Madras High Court, Delhi High Court, and Kerala High Court involving identical question of law regarding determination of creamy layer status for Other Backward Class (OBC) candidates in the Civil Services Examination based on income of parents employed in Public Sector Undertakings (PSUs), banks, or private organisations when such income was excluded from determination in the case of Government servants, the Division Bench of Pamidighantam Sri Narasimha and R. Mahadevan, upheld the impugned judgments and affirmed the directions issued by the High Courts for reconsideration of the candidates’ claims under the Office Memorandum dated 08 September 1993.

The Court held –

1. The clarificatory letter dated 14 October 2004 cannot override or alter the substantive framework of the Office Memorandum dated 8 September 1993

2. Creamy layer status among OBCs cannot be determined solely based on parental income.

3. If PSU/private employees are treated differently from Government employees holding equivalent posts, it would amount to hostile discrimination, thereby violating Articles 14 and 16.

What is the current rule ?

According to the current rules, OBC families with an annual income exceeding Rs 8 lakh are classified under the creamy layer. Children of such parents are not eligible for reservation in Government jobs and educational institutions. In 2017, this income limit was increased from Rs 6 lakh to Rs 8 lakh per year.