Parental Income Alone Cannot Set Creamy Layer Status
Context:
The Supreme Court recently settled a decades-long dispute by ruling that parental income cannot be the sole criterion to determine the "creamy layer" status among Other Backward Classes (OBCs).
This landmark judgment resolves the confusion over calculating wealth for candidates whose parents are employed in Public Sector Undertakings (PSUs) and the private sector
The 1993 Memorandum:
The original Department of Personnel and Training (DoPT) Official Memorandum (OM) issued in September 1993 explicitly excluded income from "salary" and "agricultural land" when applying the income or wealth test for determining creamy layer status.
The 2004 Clarification:
A subsequent DoPT letter on October 14, 2004, altered this by directing the inclusion of salary income specifically for PSU and private sector employees.
This effectively excluded the children of these employees from reservation benefits if their parents' salary exceeded the ₹8 lakh threshold, creating a stark disparity with regular government employees whose salaries were not counted.
Supreme Court's Ruling:
A Division Bench struck down the 2004 interpretation.
The Court stated that excluding candidates solely on the basis of salary—without reference to their actual posts (whether Group A, B, C, or D)—amounts to "hostile discrimination" and treats equals unequally.
The Court emphasized that the framework for excluding the creamy layer is fundamentally status-based.
The objective is to identify social advancement, not to create artificial financial distinctions between equally placed members of the same social class.
Beneficiaries:
The ruling significantly widens the reservation pool, reinstating eligibility for candidates previously excluded due to the flawed salary calculation.
For candidates who previously cleared civil services exams but were denied proper allocation, the Court has directed the government to create "supernumerary posts."
Consequently, many existing officers will now be allocated higher-rank services or different cadres based on their revised status.