All you need to know about the landmark Supreme Court verdict on reservation quotas for job promotions

• Supreme Court has passed landmark judgment that will have a major impact on reservation benefits for members of the Dalit and Adivasi communities.
  
• Indian states will no longer be required to furnish data proving backwardness while providing reservations for Scheduled Caste and Scheduled Tribes (SC/ST) during job promotions.
  
• The principle of 'creamy layer' has been extended to include SC/ST members.

The Supreme Court has made it easier to grant caste-based reservations to members of the Dalit community (Scheduled Castes) and Adivasis (Scheduled Tribes) during job promotions. But, the apex court has also potentially made it harder for economically advanced SCs and STs to reap reservation benefits by extending the 'creamy layer' exclusion to those members.

On Wednesday, the Supreme Court said that Indian states would no longer be required to furnish data proving backwardness while providing reservations for Scheduled Caste and Scheduled Tribes during job promotions in the public sector.

That had been a requirement since the 2006 Supreme Court judgment in the M Nagaraj Vs Union of India case, which made it mandatory for states to furnish 'quantifiable data' on backwardness of SCs and STs, showing insufficient representation in the government jobs in question.

The data collection requirement had been a huge hurdle for granting promotions to the reserved castes and promotion cases often wound up in courts, which pronounced judgments denying promotions to SC and ST candidates because of the lack of data.

A five-member bench led by Chief Justice Dipak Misra ruled that the 2006 judgment went against the 1992 judgment made by the Supreme Court in the Indra Sawhney verdict, observing that SCs and STs are the "most backward or the weakest of the weaker sections of society" and should be presumed to be backward.

What is ‘creamy layer’?

However, the court also ruled that the ‘creamy layer’ exclusion will also now include members of the SC and ST community, reversing all previous Supreme Court judgments that had made an exemption for the creamy layer to be applicable to SC and ST castes.

The ‘creamy layer’ principle essentially restricts the benefits of caste-based reservation to reach members of other backward castes only who are deemed to have an annual family income above ₹800,000 ($11,000) per annum for a period of three consecutive years as of 2017.

The reservation benefits for the SC and ST community had thus far been based on the spirit of reversing centuries of social discrimination including 'untouchability' and many have argued that reservations shouldn’t be seen from the prism of poverty alleviation.

The Supreme Court bench noted - “The whole object of reservation is to see that backward classes of citizens move forward so that they may march hand in hand with other citizens of India on an equal basis. This will not be possible if only the creamy layer within that class bag all the coveted jobs in the public sector and perpetuate themselves, leaving the rest of the class as backward as they always were.”

It added, the principle “does not in any manner tinker with the Presidential List under Articles 341 or 342 of the Constitution of India.”

And only “those persons within that group or sub-group, who have come out of untouchability or backwardness by virtue of belonging to the creamy layer, who are excluded from the benefit of reservation.”