No rationale behind certain criteria for determining creamy layer: Delhi HC

The Delhi High Court recently delivered a judgment in which it held certain criteria for determining the creamy layer among Other Backward Classes (OBC) to be without rationale or justification..The origins of the matter can be traced back to the aftermath of the Supreme Court’s judgment in Indra Sawhney v. Union of India. Following the judgment, an expert committee was formulated to identify the “creamy layer” within the reserved categories. Members of this creamy layer would be denied the benefits of reservation on the basis that they no longer required affirmative action..On September 8, 1993, the Department of Personnel and Training (DoPT) issued an Office Memorandum (OM) laying down the various criteria to be used to determine whether an individual falls within the creamy layer..These criteria included parental income and occupation. For instance, children of those who had been directly recruited as Class I or II employees would form part of the “creamy layer”. Additionally, children of those whose income exceeded the “exemption limit as prescribed in the Wealth Tax Act for a period of three consecutive years” would also fall in the creamy layer. However, under Category VI of the memorandum, income from salaries or agricultural land was not to be included while calculating this income..As for the children of PSU employees,.“Children of officers and employees of PSUs etc., in which equivalence of posts cannot or is not found, would be not disentitled under Category II C and thus would have to be evaluated under VI B.”.However, in 2004, the DoPT issued another memorandum stating that for children of “persons employed in organizations where equivalence or comparability of posts vis-a-vis posts in Government has not been evaluated”, salaries would be taken into account for calculating the income limit..It is this communication that the petitioners have sought to get quashed by the Delhi High Court. They claim that they had taken the Civil Services Examination in the year 2015 as Non-Creamy Layer OBC Candidates and that they were recommended for allocation of service in May 2016, after due verification by the DoPT..According to them, the necessary information sought for was duly provided by them, yet their names did not find mention in the list of service allocation of selected candidates..The core issue was the method of calculation of income to determine whether the children of OBCs employed in PSUs were part of the creamy layer or not..The submission of the petitioners was that there was no logic or rationale to issue the communication dated October 14, 2004, to clarify the Creamy Layer Status amongst the OBCs in reference to Public Sector Undertakings, as the OM of September 1993 was issued after due deliberation and upon approval from the Parliament..The argument advanced on behalf of the government was that the 2004 communication clarifies the Creamy Layer Status among the OBCs and that it does not create any discrimination between government employees and the employees of the PSUs..The Single Judge Bench of Justice Sunil Gaur observed that,.“Upon hearing and on perusal of impugned Communication of 14th October, 2004 of first respondent, on basis of which OBC Certificates of petitioners were scrutinized, the material on record and the decision cited, I find that O.M. of September, 1993 deals with Officers Class alone and that the equivalence or comparability of posts in PSUs viz-a-viz posts in government has not been carried out….The Communication of 14th October, 2004 takes into account salary of parents of OBC candidates whereas as per O.M. of September, 1993, the income from other sources is the basis to determine the Creamy Layer Status of OBCs in case of PSUs, where equivalence has not been established.”.The Bench held that it found no rationale or justification in the impugned 2004 communication, or in the counter affidavit filed by the government, to make the salary of OBC employees in PSUs as the basis to determine their Creamy Layer Status..The Court directed that the verification of the Creamy Layer Status of petitioners be carried out within eight weeks, while solely relying upon the OM of September, 1993..The petitioners had initially approached the Supreme Court way of a writ petition under Article 32. The Supreme Court had issued notice and passed certain interim orders. Thereafter, the matters were transferred to the Delhi High Court, to be decided on merits..Advocates Rajshekar Rao, Vikram Hegde and Prateek Chadha appeared for the petitioners..Read Judgment: