November 6, 2026

Supreme Court Rejects Centre’s Plea on OBC Creamy Layer; Parents’ Salary Alone Cannot Decide Reservation Eligibility

New Delhi/Alive News: The Supreme Court has rejected the Centre’s request for a two-year extension to implement its ruling on the OBC creamy layer criteria for UPSC examinations. The court clarified that parents’ salary or income alone cannot be used to decide whether a candidate qualifies for OBC reservation benefits.

The court said the social status of parents and the nature of their employment must also be considered while deciding eligibility. It granted the Centre an additional eight weeks to comply with its earlier judgment.

The Centre had sought more time to develop a system for comparing posts in Public Sector Undertakings (PSUs) and private companies with equivalent government positions.

What Is the OBC Creamy Layer Case?

The case concerns candidates whose parents work in PSUs, banks and similar organisations. They had approached the Central Administrative Tribunal (CAT), seeking Non-Creamy Layer benefits under the OBC quota in the Civil Services Examination.

In 1993, the Centre issued guidelines for identifying the OBC creamy layer. Under these rules, salary and agricultural income were excluded from the income calculation. However, a clarification issued on October 14, 2004, stated that the salaries and income of employees working in PSUs and private-sector organisations would be considered.

Based on this clarification, the government counted the parents’ salaries while deciding the candidates’ eligibility, leading to the denial of reservation benefits.

Supreme Court Questions 2004 Clarification

During a hearing on March 14, the Supreme Court observed that the 2004 clarification could not override the original policy.

The court also said that treating government employees differently from PSU employees could be discriminatory. It held that candidates should not be denied reservation benefits merely because their parents work in PSUs and earn salaries.

The court had directed the government to reconsider the candidates’ claims within six months. It also said separate posts could be created, if required, to accommodate eligible candidates.