OBC creamy layer income test issue stuck between Ministries, says House panel chief

Why in the News

The chairperson of the House Committee on the welfare of Other Backward Classes (OBCs) has said the OBC creamy layer income test issue is stuck between the Department of Personnel and Training (DoPT) and the Ministry of Social Justice and Empowerment, with the Social Justice Ministry yet to formulate the policy needed to place the matter before the Cabinet. The issue follows a Supreme Court judgment in March that found the DoPT was practising “hostile discrimination” by applying the income test differently to OBC candidates whose parents worked in posts without an established equivalence to government service, and directed the government to exclude salaries from the test for that category and create supernumerary posts for wrongly denied candidates. The government had six months to implement the directions but has instead approached the Supreme Court arguing retrospective implementation is “extremely difficult.” Nearly six months on, the two Ministries continue to pass responsibility for the equivalence-of-posts policy to each other, leaving the Court’s directions unimplemented.

What is the OBC creamy layer income test?

1. What it does: The creamy layer income test excludes wealthier or higher-status members of Other Backward Classes from non-creamy-layer OBC reservation benefits, based on parental income and the equivalence of a parent’s post with government service.
2. Where the dispute lies: The test has been applied differently depending on whether a parent’s post has an established equivalence with a government post.
3. Its legal basis: The equivalence determination has rested on the DoPT’s interpretation of a 2004 letter.

What did the Supreme Court’s ruling require?

1. Finding of hostile discrimination: The Court held that the DoPT was practising hostile discrimination by applying the income test differently based on equivalence status.
2. Salary exclusion direction: The Court directed the exclusion of salary income from the test for candidates whose parent’s post had no established equivalence with government service.
3. Supernumerary posts direction: The Court directed the creation of supernumerary posts for OBC candidates wrongly denied non-creamy-layer status.

Why has implementation stalled between the two Ministries?

1. Policy not yet formulated: The Social Justice Ministry has not formulated the equivalence-of-posts policy needed before the matter can go to the Cabinet.
2. Government contests retrospective application: The government told the Supreme Court that retrospective implementation is “extremely difficult” and argued that some cases must still count salary income.
3. Responsibility passed back and forth: In 2025 committee hearings, the DoPT told the House panel the equivalence responsibility lay with the Social Justice Ministry, which has yet to respond to the committee on the issue.

Conclusion

The dispute is procedural rather than substantive, over which Ministry must act first, and until the Social Justice Ministry frames the equivalence policy, the Supreme Court’s correction to the OBC income test remains unimplemented well past its six-month deadline.

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