Reservation Solely Based On Economic Criteria Does Not Violate Basic Structure Of Constitution : Supreme Court In EWS Quota Case

Reflecting upon the argument of the petitioners that for affirmative action the Constitution of India contemplates social and educational backwardness and not economic disadvantage alone, the majority judgment, largely, held that economic criteria as the sole basis for affirmative action does not violate the basic structure of the Constitution. Justice Bhat concurred with the majority opinion to the extent that economic criteria can be a basis for affirmative action with respect to affirmative action under Article 15 of the Constitution (such as reservation in education).

Justice Maheshwari: In order to emphasize on the realities of egalitarian socio-economic order, Justice Maheshwari referred to the United Nations General Assembly resolution dated 25.09.2015 setting eradication of poverty in all its forms everywhere as one of its primary goals. He opined that when poverty is not merely a state of stagnation but is a point of regression, enabling provisions ought to find their way into the Constitutional framework. He notes that the Apex Court in its previous judgments on social justice had been gilded by the jurisprudence evolved by the U.S. Supreme Court in view of amendments made to their Constitution on the basis of economic consideration. Justice Maheshwari, thus, highlighted the economic backwardness of citizens as the sole ground for affirmative action. He added -

"Any civilized jurisdiction differentiates between haves and have-nots, in several walks of life and more particularly, for the purpose of differential treatment by way of affirmative action."

In order to examine the proposition - whether economic criteria as the sole basis for affirmative action is violative of the basic structure doctrine, Justice Maheswari referred to a catena of judgments of the Apex Court.

1. He pointed out that in Kesavananda Bharati v. State of Kerala And Anr, the Apex Court had held welfare state to be one of the main objectives of the Constitution. He observed that in its effort to ensure all-inclusive social-economic justice, the State cannot deny affirmative action to the economically disadvantaged merely because they are not suffering from any other disadvantages. 
2. Reliance was placed on M.R. Balaji And Ors. v. State of Mysore And Ors., to note that the Court had stated that affirmative action must be based on an objective approach, free from external pressures, and intended to do social and economic justice.
3. He referred to R. Chitralekha And Anr. v. State of Mysore And Ors., where the definition of 'backwardness' acknowledged by the Apex Court was devoid of any caste consideration, but included criteria like, occupation, income and other economic factors. It was asserted that mere exclusion of caste would not render a classification unconstitutional if it satisfies the other tests.
4. Janki Prasad Parimoo And Ors. v. State of J&K And Ors. was also relied upon, wherein the Apex Court had noted that India social and educational backwardness is associated with economic backwardness.
5. He emphasised on the observation of CJ, AN Ray in State of Kerala And Anr. v. N.M. Thomas And Ors. on substantive equality; that equality of opportunity for unequals furthers inequality. And thus, differential treatment in standard of selection falls within the concept of equality. Justice Ray had also noted that the Government's affirmative responsibility to eliminate social, economic and other inequalities is crucial to the Constitutional law. Justice M.H. Beg had also stated that the legislature ought to endeavour to eliminate socio-economic inequalities. Justice Maheshwari highlighted the observation of Justice V.R. Krishna Iyer and Justice S. Murtaza Fazal Ali, that DPSP casts a responsibility on the State to take care of educational and economic interests of the weaker sections of the people. Justice Iyer had noted -

"The scheduled castes and scheduled tribes have earned special mention in Article 46 and other 'weaker sections', in this context, means not every 'backward class' but those dismally depressed categories comparable economically and educationally to scheduled castes and scheduled tribes."

1. Justice Maheshwari quoted Justice Ranganath Mishra, who in M/s. Shantistar Builders v. Narayan K. Totame And Ors. had said -

"Undoubtedly, apart from the members of the Scheduled Castes and Scheduled Tribes, there would be millions of other citizens who would also belong to the weaker sections. The Constitution-makers intended all citizens of India belonging to the weaker sections to be benefited when Article 46 was incorporated in the Constitution."

1. Reference was made to Indra Sawhney And Ors. v. Union of India And Ors., especially the observations made by Justice S. Ratnavael Pandian, Justice Sawant and Justice B.P. Jeevan Reddy when they talk about the features of backwardness of all sorts, including economic backwardness, which Justice Sawant recognised as the bane of the majority of the people in India. "Means test" (income and extent of property can be taken as a measure of social advancement) was adopted to exclude the creamy layer from the ambit of reservation.
2. Observation of Justice S.H. Kapadia in M. Nagaraj was also referred to by the Judge, wherein he discussed the concept of egalitarian equality and the expectation from the State to acknowledge reservation in favour of disadvantaged sections of the society.

From the above-mentioned judgments, Justice Maheswari culled out the following observations -

1. On contextual reading of the judgment, it would appear that economic criteria alone cannot be the basis for reservation under Articles 15(4) and.or 15(5) and/or 16(4). However, the judgments ought not to be read in a manner that if any section other than those covered by Article 15(4) and/or 15(5) and/or 16(4) is suffering economic disadvantage alone, no affirmative action can be made by the State.
2. The plethora of judgments the Court has not, in essence, put a blanket ban on providing reservation for economically disadvantaged sections of the people.
3. The Constitution contemplates State to administer 'distributive justice, i.e., to remove economic inequalities and rectifying past injustices. The promise of Justice in the Preamble, includes economic justices, besides social and political justice.
4. The Constitution envisages affirmative measures under Article 46 in favour of SCs/STs and such other weaker sections who are "similarly circumstanced to SCs/STs". The expression "other weaker sections" needs to be given the widest possible meaning as per the basic rules of interpretation of the text of the Constitution. The expression is not confined to only those sections who are in similar circumstances to SCs and STs.

Justice Maheshwari concluded :

"Reservation is an instrument of affirmative action by the State so as to ensure all-inclusive march towards the goals of an egalitarian society while counteracting inequalities; it is an instrument not eonly for inclusion of socially and educationally backward classes to the mainstream of society but, also for inclusion of any class or section so disadvantaged as to be answering the description of a weaker section. In this background, reservation structured singularly on economic criteria does not violate any essential feature of the Constitution of India and does not cause any damage to the basic structure of the Constitution of India".

Justice Trivedi: Justice Bela. M. Trivedi also held that treating the economically weaker section of the citizens as a separate class would be a reasonable classification in terms of the goals of substantive equality contemplated by the previous judgments of the Apex Court.

"The impugned amendment creates a separate class of "economically weaker sections of the citizens" from the general/unreserved class, without affecting the special rights of reservations provided to the Scheduled Caste/Scheduled Tribe and backward class of citizens covered under Article 15(4), 15(5) and 16(4). Therefore, their exclusion from the newly created class for the benefit of the "economically weaker sections of the citizens" in the impugned amendment cannot be said to be discriminatory or violative of the equality code."

Justice Pardiwala: Referring to N.M. Thomas, Justice Pardiwala opined that economic criteria can be a relevant factor for affirmative action. He further stated -

"In this country with a population of around 1.41 billion, the economic backwardness is not confined only to those who are covered by Article 15(4) or Article 16(4) of the Constitution. In a country where only a small percentage of the population is above the poverty line, to deny opportunities of higher education (which secures employment) and employment is to deny to those who are qualified and deserving what is or at least should be their due."

He stated that if economic advancement can be accepted as a criteria to negate social disadvantages from the OBCs, the converse can be true for granting reservation to the economically disadvantaged sections of the society.

"Economic capacity has been upheld as a valid basis for classification by this Court in various other contexts. It has also been implored to be considered as a relevant facet of the 'Equality Code' provisions. The 103rd Amendment offers a basis not frowned upon by Article 15(1) or 16(2) for providing a population generic and caste/religion/community neutral criteria. It also harmonizes with the eventual constitutional goal of a casteless society."

Justice Bhat: In the dissenting judgment, Justice Bhat, agreed with the majority opinion that 'economic criteria' for the purpose of Article 15 is permissible, but disagreed with respect to Article 16(reservation in public employment). He pointed out that in Indra Sawhney it was categorically noted that economic criteria alone cannot be the basis for reservation. However, the Apex Court had not indicated that there cannot be reservation on the basis of economic criteria. He added that -

"That judgment (Indra Swanhey) is authoritative, for its determination of what is permissible, and what should be the constitutional method of implementing, backwardness-based affirmative action. However, it cannot be considered as exhaustive of new criteria, which may be brought about by constitutional amendments (thus, removing the basis of the judgment itself).

Referring to provisions of the DPSPs, Justice Bhat reckoned that the State is obligated to fulfill its mandate of substantive equality. Social justice demands removal of all inequalities including economic. According to him, economic emancipation is a facet of economic justice promised by the Preamble. The reservation on economic criteria introduced by the impugned Constitution Amendment Act does not violate the basic structure of the Constitution.

However, he takes a divergent view in case of Article 16 of the Constitution. Justice Bhat notes that the reservation under Article 16(4) is premised on "adequate representation". The reservation sought for the economically weaker sections is not for lack of representation and therefore does not qualify for reservation under Article 16. Granting reservation to a section of the population who are not socially backward and whose community is represented in public employment would be in violation of the Preamble as well as Article 16(1).

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