Validity of EWS Reservation Explained

Before reading the recent EWS Context, aspirants are advised to go through these posts for basic knowledge:

RESERVATIONS IN INDIA: NEED, ISSUES AND SOLUTIONS

Context: The Supreme Court in a majority judgment on Monday (7th Nov. 2022) upheld the validity of the Constitution's 103rd Amendment Act 2019, which provides for 10 percent EWS reservation amongst the general category, and observed that it does not violate essential features of the constitution. A five-judge Constitution bench in a 3:2 upheld the validity of the Constitution's 103rd Amendment Act 2019, where three judges passed the verdict upholding the Act while CJI UU Lalit concurred with Justice S Ravindra Bhat and passed a dissent order.

Relevance: Prelims- Current Affairs of National and International Importance.
Mains-GS-2; Indian Constitution, Government policies and interventions aimed at development in various sectors and issues arising out of their design and implementation.

Supreme Court, in a majority verdict, upholds constitutional validity of EWS quota

Introduction:

• The 103rd Constitution Amendment Act provides for 10% reservation in government jobs and educational institutions for the economically weaker section in the unreserved category. (This 10% ceiling is independent of ceilings on existing reservations.)
• The Act amends Articles 15 and 16 to provide for reservation based on economic backwardness. 
• The new clause (6) to Article 15 allows the government to carve reservations for the economically weaker sections of society in higher educational institutions, including private ones, whether they are aided or not by the State. Minority educational institutions are exempted.  
• Likewise, the new clause (6) to Article 16 provides for a quota for economically deprived sections in the initial appointment in government services. 
• It provides reservations for:
  • People who have an annual income of less than Rs 8 lakh, or 
  • People who own less than five acres of farmland, or 
  • People who have a house less than 1,000 sq feet in a town (or 100 sq yards in a notified municipal area). 

The Issue:

• More than 20 petitions have been filed challenging the constitutional validity of the 103rd Amendment.
• They argue that the Amendment violates the basic features of the Constitution and violates the fundamental right to equality under Article 14.
• In particular, they make the following  arguments:
  • Reservations cannot be based solely on economic criteria, given the Supreme Court’s judgment in Indra Sawhney v. Union of India (1992).
  • SCs/STs and OBCs cannot be excluded from economic reservations, as this would violate the fundamental right to equality.
  • The Amendment introduces reservations that exceed the 50% ceiling limit on reservations, established in Indra Sawhney Case.
  • Imposing reservations on educational institutions that do not receive State aid violates the fundamental right to equality.
• On August 5th, 2020, the Court decided to refer this case to a five-judge bench that will decide:
  • If reservations can be granted solely on the basis of economic criteria?
  • If States can provide reservations in private educational institutions which do not receive government aid, as provided in the Amendment?
  • If EWS reservations are invalid for excluding Scheduled Castes, Scheduled Tribes, Other Backward Classes, and Socially and Economically Backward Classes from its scope?

Recent Judgement of the Constitution Bench of Supreme Court:

• The Supreme Court in a majority judgment upheld the validity of the Constitution's 103rd Amendment Act 2019, which provides for 10 percent EWS reservation amongst the general category, and observed that it does not violate essential features of the constitution.
• A five-judge Constitution bench in a 3:2 upheld the validity of the Constitution's 103rd Amendment Act 2019, where three judges passed the verdict upholding the Act while CJI UU Lalit concurred with Justice S Ravindra Bhat and passed a dissent order.

Can there be quotas based on economic criteria alone?

Majority Opinion:

• In his opinion, Justice Dinesh Maheshwari said that poverty is an adequate marker of deprivation that the state can address through reservations.
• The SC’s earlier jurisprudence holding that “economic criteria cannot be the sole basis for determination of backwardness” is somewhat restricted to the reservation provided to Social and Economically Backward Classes, and EWS is deemed a separate and distinct category, he said.
• Justice Bela Trivedi in her separate but concurring opinion upheld the amendment based on the presumption that “the legislature understands and appreciates the needs of its own people.”
• Justice Pardiwala said that while he is “conscious of the fact that the economically weaker sections of the citizens are not declared as socially and economically backward classes (SEBCs) for the purpose of Article 15(4) of the Constitution”, separate reservations are not barred by the Constitution.
• His opinion cited the Right to Education, another constitutional amendment that puts an obligation on the state to provide free and compulsory primary education, as an example of other forms of reservation.

Minority Opinion:

• Justice Ravindra Bhat said while laws that provide benefits based on “only economic criteria” do not by themselves violate the right to equality, the Constitution envisages reservations to only be community-based and not individual-centric.
• So while access “to public goods” such as tax breaks, and subsidies can be allowed, reservation in public employment would not be permissible. “It is inconceivable that the deletion of caste (as long as Indian society believes in and practices the caste system) as a proscribed ground through a constitutional amendment would stand scrutiny,” he said.

Is the exclusion of SC/ST, and SEBC from quota discriminatory?

Majority Opinion:

• Justice Maheshwari said that “there cannot be a competition of claims for affirmative action based on disadvantages.” Reservation cannot be denied to one section (the EWS) because “that segment is otherwise not suffering from other disadvantages.”
• Justice Pardiwala said that Article 16(4) is exhaustive for reservation in favor of backward classes but the section is not exhaustive of the concept of reservation. The new constitutional amendment introducing another affirmative action method is read as separate and distinct.

Minority Opinion:

• This exclusion is the main ground for striking down the constitutional amendment as per the minority opinion. Justice Bhat gave three reasons why the exclusion of SC/ST/OBC is unconstitutional.
• First, it “others” those subjected to socially questionable and outlawed practices, though they are amongst the poorest sections of society, and goes against the idea of fraternity.
• Second, the exclusion virtually confines SC/ST/OBC within their allocated reservation quotas (15 percent for SCs, 7.5 percent for STs, and 27 percent for OBCs).
• Third, it denies the chance of “mobility from the reserved quota (based on past discrimination) to a reservation benefit based only on economic deprivation.”

Can quota for the poor breach the 50% ceiling for reservations?

• Several issues in the EWS quota challenge were based on crucial aspects already decided by the Supreme Court in the landmark 1992 Indra Sawhney vs Union of India verdict.
• A nine-judge Bench had upheld the 27 percent quota for OBCs but had struck down the 10 percent quota based on economic criteria.
• The first key point in that ruling was that “a backward class cannot be determined only and exclusively with reference to the economic criterion”.
• “It may be a consideration or basis along with, and in addition to, social backwardness, but it can never be the sole criterion,” the court had held.
• Second, the SC held that reservation cannot cross 50 percent unless a special case was made out in “extraordinary situations and peculiar conditions”.

In the current case, a five-judge court could not have overruled Indra Sawhney, which was delivered by a larger bench but found reasoning to uphold the EWS quota.

Majority opinion:

•  The majority opinion by Justice Maheshwari held that the 50 percent ceiling was for backward classes and it “overstretched to the reservation provided for an entirely different class, consisting of the economically weaker sections”. “Moreover…this ceiling limit…has not been held to be inflexible and inviolable for all times to come.”

Minority view:

• Although Justice Bhat refrained from expressing a view on whether it is permissible to breach the 50 percent ceiling, the minority opinion warned that breaching it could “eat up the rule of equality.”
• The minority opinion also stated that going above 50 percent “becomes a gateway for further infractions…”
• However, since the question is also pending before another Constitution bench — on whether a Tamil Nadu law providing for reservation in excess of the 50 percent limit is unconstitutional — Justice Bhat did not “seal the fate of the pending litigation…”

Can private colleges be forced to have an EWS quota?

• Under Article 15(5) of the Constitution, the state has the power to make reservations in private educational institutions.
• Only Justice Maheshwari’s opinion, part of the majority view, engaged with this issue to an extent. “Unaided private institutions, including those imparting professional education, cannot be seen as standing out of the national mainstream. As held in the aforementioned judgments, reservations in private institutions are not per se violative of the basic structure. Thus, reservations as a concept cannot be ruled out in private institutions where education is imparted,” the opinion stated.
• The opinion added that Parliament now would have had the benefit of the Supreme Court’s earlier verdict upholding the constitutional amendment that introduced the Right to Education.

For more coverage you can also read this: ECONOMICS, EXCLUSION – THE SC VERDICT ON THE EWS QUOTA | 8TH NOVEMBER 2022 | UPSC DAILY EDITORIAL ANALYSIS