MAINS Current Affairs includes Govt. Opposes Income-Based Creamy Layer in SC/ST Quotas & Money Bill Passed to Increase Judges’ Number: Why This Route Faces Legal Challenge?

POLITY AND GOVERNANCE

1. Govt. Opposes Income-Based Creamy Layer in SC/ST Quotas

Context: The Union Government informed the Supreme Court that the concept of “creamy layer” cannot be extended to Scheduled Castes (SCs) and Scheduled Tribes (STs) for reservation benefits.

• The issue arose from petitions seeking the exclusion of economically advanced sections within SC/ST communities from reservation benefits.

What is the Issue?

Background

• Petitions before the Supreme Court sought the application of the creamy layer principle within SC and ST reservations, similar to OBC reservations.
• The Court also sought an Action Taken Report following its 2024 judgment permitting sub-categorisation within SCs and STs.

Government’s Stand

• The creamy layer doctrine has historically been applied only to OBCs.
• Reservation for SCs and STs is based on historical discrimination, social exclusion, caste stigma and tribal disadvantage, not merely economic criteria.
• Any change in reservation policy requires a comprehensive empirical study and policy review.
• Seeking income-based exclusion does not automatically raise a constitutional issue or indicate a violation of fundamental rights.

Reservation in India

• As per existing instructions, reservation is provided to Scheduled Castes (SCs), Scheduled Tribes (STs) and Other Backward Classes (OBCs) at the rate of15%, 7.5% and 27%, respectively, in case of direct recruitment on all India basis by open competition.
• TheConstitution (103rd Amendment) Act 2019 enables the State (i.e., both the Central and State Governments) to provide reservation to the Economically Weaker Sections (EWS) of the society. 

Creamy Layer Principle

• It is a concept used to ensure that reservations in educational institutions and government jobs are extended to thosewho are economically and socially disadvantaged within a certain group. 
  • It aims to prevent the more affluent or advantaged membersof a reserved category from availing themselves of these benefits.
• Origin: The concept was first articulated by the Supreme Court of India in the Indra Sawhney case (1992),also known as the Mandal Commission case. 
  • The Court’s ruling emphasized that within the OBC (Other Backward Classes) category, those who are relatively more privileged should not benefit from reservations.
• Impact:By applying the creamy layer principle, the government aims to make its affirmative action policies more effective and equitable, ensuring that those who are most in need receive the support intended for them.

Constitutional Provisions Related to Reservation

• Article 16:It provides for equality of opportunity for all citizens but as an exception the State can provide for reservation of appointments or posts in favour of any backward class that is not adequately represented in the state services.
• Article 16 (4A):Provides that the State can make any provision for reservation in matters of promotion in favour of the Scheduled Castes and the Scheduled Tribes if they are not adequately represented in the services under the State.
• Article 335:It recognises that special measures need to be adopted for considering the claims of SCs and STs to services and posts, in order to bring them at par.
• 103 Amendment of the Constitution of India: Introduced 10% reservationfor Economically Weaker Sections (EWS) of society.

Supreme Court Judgment on SC Sub-Categorisation (2024)

Key Verdict

• Supreme Court upheld sub-classification within SC categories by a 6:1 majority.
• Overruled V. Chinnaiah v. State of Andhra Pradesh (2004).

Court’s Reasoning

• SC communities are not homogeneous.
• Equality under Article 14 permits reasonable classification among groups that are differently placed.
• Effective representation matters more than mere numerical representation.

Conditions for Sub-Classification

States must establish:

• Quantifiable data;
• Greater backwardness;
• Inadequate representation;
• Rational and non-arbitrary classification.

Arguments in Favour of Creamy Layer/Sub-Categorisation

Unequal Backwardness

• Some SC communities have benefited more than others.
• Marginalised sub-castes remain underrepresented.

Promotes Social Justice

• Ensures benefits reach the most deprived sections.

Effective Representation

• Improves participation of neglected communities in education and public employment.

Constitutional Support

• Articles 15(4) and 16(4) permit special provisions for backward classes.

Data-Based Targeting

• Allows affirmative action to be directed where it is most needed.

Arguments Against Creamy Layer in SC/ST Reservations

Historical Discrimination Persists

• Social stigma and caste-based discrimination continue regardless of income.

Article 341 Concerns

• States cannot indirectly alter the SC list through internal classifications.

Community Fragmentation

• May create divisions and weaken collective political strength.

Difficult Criteria

• Measuring relative disadvantage within SC/ST communities is complex.

Different from OBC Reservations

• OBC reservation is based on social and educational backwardness.
• SC/ST reservation is primarily a remedy against historical untouchability, exclusion and discrimination.

Way Forward

Constitutional Approach

• Any reform should remain within Articles 14, 15(4), 16(4) and 341.

Evidence-Based Policy

• Decisions should be backed by robust socio-economic and representation data.

Careful Evaluation of Creamy Layer

• If considered for SC/STs in the future, separate criteria from OBCs must be developed.

Beyond Reservations

• Strengthen:
  • Education,
  • Skill development,
  • Entrepreneurship support,
  • Anti-discrimination measures,
  • Social empowerment programmes.

Conclusion

The debate over applying the creamy layer principle to SC/ST reservations highlights the tension between ensuring equitable distribution of reservation benefits and preserving safeguards against historical discrimination. While the Supreme Court has allowed sub-categorisation based on empirical evidence, the Union Government maintains that income alone cannot determine deprivation among SCs and STs. Any future reform must balance social justice, constitutional principles, and effective representation.

POLITY AND GOVERNANCE

2. Money Bill Passed to Increase Judges’ Number: Why This Route Faces Legal Challenge?

Context: The Rajya Sabha has passed the Supreme Court (Number of Judges) Amendment Bill, 2026.

• The Bill was passed as a Money Bill, similar to the 2019 amendment that increased the Supreme Court’s strength to 34 judges.
• The classification of such legislation as a Money Bill is under judicial scrutiny and is pending before a seven-judge Constitution Bench of the Supreme Court.

Types of Bills in Parliament

1. Constitution Amendment Bills

• Seek to amend provisions of the Constitution.
• Governed by Article 368.

2. Money Bills

• Defined under Article 110.
• Contain only provisions relating to:
  • Taxation
  • Government borrowing
  • Consolidated Fund of India
  • Contingency Fund of India
  • Appropriation and expenditure of public money
• Can be introduced only in the Lok Sabha.
• Rajya Sabha can only recommend changes and cannot reject or amend them.
• Speaker’s certification is required.

3. Financial Bills

• Include provisions related to taxation/expenditure along with other matters.
• Require approval of both Houses.

4. Ordinary Bills

• Cover all other legislative matters.
• Need approval from both Lok Sabha and Rajya Sabha.

Why Was the Judges’ Strength Bill Passed as a Money Bill?

Government’s Argument

• Increasing the number of Supreme Court judges results in:
  • Additional salaries and allowances.
  • Higher expenditure from the Consolidated Fund of India.
• Therefore, the Bill is considered related to government expenditure.

Constitutional Basis

• Article 110(1)(g) includes:

“Any matter incidental to any of the matters specified in Article 110(1)(a) to (f).”

• The government relies on this incidental expenditure clause to justify Money Bill classification.

Why Is It Legally Controversial?

Narrow Definition of Money Bill

• Critics argue that merely causing expenditure does not automatically make a Bill a Money Bill.
• The primary objective of the Bill is:
  • Increasing judicial strength,
  • Not appropriation or taxation.

Reduced Role of Rajya Sabha

• Certifying a Bill as a Money Bill significantly limits Rajya Sabha’s powers.
• Concerns arise regarding:
  • Federalism,
  • Bicameralism,
  • Legislative scrutiny.

Potential Misuse

• Governments may use the Money Bill route to bypass opposition in the Rajya Sabha.
• Opposition parties have previously raised similar concerns.

Speaker’s Role

• The Speaker of Lok Sabha certifies whether a Bill is a Money Bill.
• The Constitution states that:
  • The Speaker’s decision is final.
  • Parliamentary proceedings generally cannot be challenged in courts.

However, the Supreme Court has indicated that constitutional violations may still be subject to judicial review.

Supreme Court’s Position

Aadhaar Case (2018)

• Aadhaar Act was upheld.
• Money Bill issue was referred to a larger bench due to differing judicial opinions.

Tribunal Reforms Case (2021)

• Tribunal amendments passed as a Money Bill were struck down.
• Court held that misuse of the Money Bill route can violate bicameral parliamentary structure.

PMLA Case

• Questions regarding the validity of passing amendments through a Money Bill remain pending before a larger bench.

Significance of the Pending Seven-Judge Bench Decision

The verdict will clarify:

• Scope of Article 110.
• Meaning of “incidental matters” under Article 110(1)(g).
• Extent of judicial review over the Speaker’s certification.
• Protection of the role of Rajya Sabha in the legislative process.

Challenges

• Ambiguity in interpreting Article 110.
• Frequent use of the Money Bill route for major legislations.
• Tension between legislative privilege and judicial review.
• Concerns regarding weakening of bicameralism.

Way Forward

• The Supreme Court should provide a clear constitutional test for determining Money Bills.
• The Money Bill route should be restricted to matters strictly covered under Article 110.
• Greater transparency and constitutional discipline are needed in legislative classification.
• Parliament should ensure that major policy reforms undergo scrutiny by both Houses to preserve the spirit of cooperative federalism and parliamentary democracy.

Conclusion

The legal challenge surrounding the Supreme Court (Number of Judges) Amendment Bill, 2026 reflects a broader constitutional debate over the scope of the Money Bill provision. The upcoming Supreme Court judgment will have far-reaching implications for legislative procedure, parliamentary accountability, and the balance of power between the two Houses of Parliament.

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