Constitutional Limits to Economic Reservations

By: Aparna Singh


The politics on the reservation has always been fraught with controversies and uncertainties and has sooner or later reached the doors of the Supreme Court. The Constitution (One Hundred and Third Amendment) Act, 2019 (hereinafter ‘The Amendment’) which introduces reservations in favour of “economically weaker sections” (hereinafter ‘EWS’) of citizens is expected to meet the same fate. The Amendment adds Article 15(6) and Article 16(6) which allows the State to make any provision for reservation to EWS in the matters of admission to educational institutions and public employment. The Amendment became imperative because existing provisions of the Constitution do not envisage reservation solely based on economic status. Earlier, the State of Gujarat attempted to introduce a similar reservation of ten per cent in favour of EWS through an Ordinance. However, the Ordinance was struck down by the Gujarat High Court on the ground that there is no provision in the Constitution that empowers State to provide reservations to EWS.

Thus, in order to avoid a similar hiccup in the absence of a specific provision in the Constitution, the Centre has introduced this amendment. Nonetheless, a constitutional amendment is not immune from judicial scrutiny and can be challenged on the ground of violation of ‘basic structure’ of the Constitution. The Apex Court in the case of Ashoka Kumar Thakur v Union of India has ruled that the larger principle of equality embedded in Article 14, 15, and 16 forms part of the basic structure of the Constitution, though, the structure and design of these provisions can be changed within the bounds of the broader principle of equality. In this post, the author seeks to discuss the grounds on which reservation to EWS can be challenged on account of its abrogation of the principle of equality.


Article 16(1) guarantees equality of opportunity for all citizens in matters relating to public employment. Further, Article 16(4) enables the State to provide reservation to ‘backward classes’ (hereinafter ‘BC’) of citizens in public employment. The leading opinion in Indra Swahney v Union of India (hereinafter ‘Indra Sawhney’) authored by Hon’ble B.P Jeevan Reddy J., ruled that the ‘backwardness’ under Article 16(4) is mainly social and not both social and educational. The nine-judge Bench uniformly held that economic criterion alone cannot be taken as a measure of backwardness under Article 16(4). Justice Jeevan Reddy stated that Article 16(4) is not exhaustive of the concept of reservation; it is exhaustive of reservation in favour of BC alone. Thus, the State can provide reservation even under Article 16(1) to other classes provided there are exceptional circumstances that necessitate reservation in public interest. In Indra Sawhney, one of the questions was the constitutionality of an official memorandum that made a provision for ten per cent reservation to ‘other economically backward sections’ (similar to the EWS). The Court ruled that classification based on income or property holding is not sustainable even under Article 16(1) as it is inconsistent with the guarantee of equality of opportunity. This ruling can be taken as a ground to challenge reservation on economic basis.


Under Article 16(4), State can grant reservation in favour of BC only if it is satisfied that they are inadequately represented in the services. In M Nagaraj v Union of India (hereinafter M Nagaraj), it was held that inadequacy of representation is a constitutional requirement without which the structure of equality of opportunity would collapse. This principle can be traced from the speech of Dr. B.R Ambedkar in the Constituent Assembly Debates where he explained that the purpose of reservation is to ensure participation of communities which did not have ‘proper look-in’ into the administration. Article 16(6) added by the recent amendment does not contain the limitation of the inadequacy of representation of EWS in public services as a condition to granting them the reservation. This argument can put up against reservation on economic basis as introduced by Article 15(6) and Article 16(6).


The origin of 50 per cent rule lies in M R Balaji v State of Mysore, where the Supreme Court held that reservations under Article 16(4) cannot exceed 50 per cent. This rule was later affirmed in Indra Sawhney; however, the Court specifically clarified that 50 per cent rule applies only to the reservation in favour of BC under Article 16(4). Article 16(6) states that reservation to EWS shall be in addition to the existing reservation and shall not exceed ten per cent of the total seats. This means that the total reservation under Article 16(4) and 16(6) would be 59.5 per cent as the existing reservation under Article 16(4) is 49.5 per cent. The question is whether Article 16(6) destroys the principle of equality by providing reservation in addition to existing reservation due to which the total reservation exceeds 50 per cent. In M Nagraj, the Court ruled that 50 per cent rule is a constitutional requirement violation of which would destroy equality of opportunity. It was also ruled that Article 16(4A) which provides for reservation in promotions does not violate the basic structure of the Constitution as it retains the restriction of 50 per cent rule. It is pertinent to note that 50 per cent rule is a judicially evolved principle as the Constitution is silent on the maximum limit of reservation. The justification of this rule lies in the speech of Dr. B.R Ambedkar as mentioned in Indra Swahney, where he observed that reservation should be confined to the minority of seats. According to the author, this argument is relatively weak as there is no constitutional provision to support the limit of 50 per cent on the reservation.


The statement of objects and reasons of the Amendment says that the provision for reservation to EWS is made to fulfil the mandate of Article 46. This Article directs the “State to promote with special care the educational and economic interests of the weaker sections of people, and, in particular, of the Scheduled Castes and the Scheduled Tribes, and shall protect them from social injustice and all forms of exploitation”. Article 46 uses the term ‘weaker sections’ unlike the term ‘backward classes’ under Article 16(4). It can be argued that the provision for reservation to EWS derives its legitimacy from Article 46. However, Article 46 speaks of weaker sections that are victims of ‘social injustice and exploitation’ thereby qualifying weaker sections with some degree of social backwardness. Thus, it is difficult to contend that Article 46 contemplates reservation in favour of EWS within general category who are not victims of any kind of social disadvantage.

The explanation of Article 15(6) defines EWS as “may be notified by the State from time to time on the basis of family income and other indicators of economic disadvantage.” Article 15 and 16 are only enabling provisions and they do not confer any substantive right to reservations. Thus, the matter depends upon how the State defines EWS under the notification issued in furtherance of Article 15 and 16. If the notification fixes the limit of eight lakhs as reported by media, then this will be tantamount to providing reservation for all like a charity. This will impede the balance between the right to equality of opportunities guaranteed to every citizen and the claims of certain groups/classes to preferential treatment.


There are weighty arguments against reservation solely on economic basis, however, it must be noted that the basic structure challenge to a constitutional amendment has to meet a higher threshold of unconstitutionality. The author is of the opinion that the Constitution does not completely bar reservation on the basis of economic disadvantage coupled with other factors. In Indra Sawhney, the Court opined that BC can be identified on the basis of occupation and income criteria without making any reference to castes. The Court observed that “there may be some groups /classes in whose case caste may not be relevant. For example, agricultural labourers, Rickshaw pullers/drivers, street-hawkers etc. may well qualify for being designated as BC”.

The Court affirmed the judgement of R Chitralekha v State of Mysore, where the reservation was provided to groups whose income fell below a particular limit and who engaged in occupations notified by the State like artisans, casual workers, cultivators etc. These occupations are considered so low that social stigma is attached to them and anyone who carries them suffers exploitation irrespective of their castes. These groups, in essence, qualify as weaker sections whose economic interests deserve be to promoted by the State as enjoined by Article 46.

The scope of reservation is not limited to only caste groupings but it can be extended to other weaker sections that have suffered social injustice on account of their educational and economic weakness. In Ram Singh v Union of India, the Supreme Court struck down reservation to Jat community and made a pertinent observation that “new practices, methods and yardsticks have to be continuously evolved moving away from caste centric definition of backwardness. This alone can enable recognition of newly emerging groups in society which would require palliative action”.

The author agrees that though it is high time to drift away from the traditional caste-based approach of backwardness, however, the purpose of reservation cannot be touted as poverty alleviation programme or a move to appease masses.

(Aparna is a fourth-year law student at National Law University, Jodhpur. She has a profound interest in the subject of Constitutional Law.)

One thought on “Constitutional Limits to Economic Reservations

  1. Very nicely written blog by a student. It shows the depth of knowledge she has gone into, for bringing such opinion on the newly amended law.
    Many many congatulatins for having published a blog in pristigious Law University.

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