Supreme Court Protects OCI Cardholders’ Educational Rights: Anushka Rengunthwar vs. Union of India (2023)

Introduction

Date of the Judgment: 03 February 2023

Citation: 2023 INSC 99

Judges: A.S. Bopanna J. and C.T. Ravikumar J.

Can the Indian government suddenly change the rules for Overseas Citizens of India (OCI) cardholders, especially when it comes to their education? The Supreme Court of India recently addressed this critical question in a batch of petitions filed by OCI cardholders, primarily students aspiring to become doctors. These students, many of whom have spent most of their lives in India, were challenging a government notification that restricted their access to medical seats, limiting them to only Non-Resident Indian (NRI) quotas.

The core issue revolves around whether the government can take away a previously granted right that allowed OCI cardholders to compete for medical seats on par with Indian citizens, and whether this change violates their fundamental rights. The Supreme Court, in its judgment, examined the legal basis of these rights, the government’s rationale for the change, and the impact on the OCI cardholders.

Case Background

The petitioners in this case are OCI cardholders, many of whom are students who were either nearing or had just reached the age of majority. They aimed to pursue medical degrees (MBBS) and further specializations through the National Eligibility cum Entrance Test (NEET). These students had been preparing for their exams based on notifications from 2005 and 2009, which granted OCI cardholders parity with Non-Resident Indians (NRIs) in educational fields. This parity meant they could compete for seats like Indian citizens.

Most of these students were born in foreign countries but had lived in India for 10 to 17 years. They had completed their education, including their 12th standard, in India. In many cases, their parents were Indian nationals. They considered India their home, with deep family ties and roots in the country.

However, on March 4, 2021, the government issued a notification that changed the rules. This notification restricted OCI cardholders to only NRI or supernumerary seats, excluding them from competing for seats reserved for Indian citizens. The petitioners argued that this change was unfair and violated their rights. They sought the quashing of the notification, claiming it was discriminatory and went against the principles of “non-retrogression,” which means that rights should not be taken away.

Timeline

Course of Proceedings

The judgment does not specify any lower court proceedings. The petitioners directly approached the Supreme Court under Article 32 of the Constitution of India, challenging the notification dated 04.03.2021.

Legal Framework

The legal framework for this case is primarily based on the Citizenship Act, 1955, and the notifications issued under it. Key provisions include:

• Section 7A of the Citizenship Act, 1955: This section deals with the registration of Overseas Citizens of India (OCI) cardholders. It specifies who can be registered as an OCI, including individuals who were previously citizens of India, their descendants, and spouses of Indian citizens.
• Section 7B(1) of the Citizenship Act, 1955: This section empowers the Central Government to specify the rights that OCI cardholders are entitled to through notifications. It states, “Notwithstanding anything contained in any other law for the time being in force, an Overseas Citizen of India Cardholder shall be entitled to such rights [other than the rights specified under sub-section (2)] as the Central Government may, by notification in the Official Gazette, specify in this behalf.”
• Section 7B(2) of the Citizenship Act, 1955: This section specifies the rights that an OCI cardholder is NOT entitled to, such as the right to equality of opportunity in public employment, the right to vote, and the right to hold constitutional positions.
• Notification dated 11.04.2005: Issued under Section 7B(1), this notification granted OCI cardholders parity with Non-Resident Indians (NRIs) in economic, financial, and educational fields. It stated, “parity with Non-Resident Indians in respect of all facilities available to them in economic, financial and educational fields except in matters relating to the acquisition of agricultural or plantation properties.”
• Notification dated 05.01.2009: This notification further extended the rights of OCI cardholders, allowing them to appear for the All India Pre-Medical Test and other such tests. It stated, “To appear for the All India Pre-Medical Test or such other tests to make them eligible for admission in pursuance of the provisions contained in the relevant Acts.”
• Notification dated 04.03.2021: This notification, which is the subject of the dispute, modified the rights of OCI cardholders, restricting their eligibility for admission to only NRI or supernumerary seats. It stated, “appearing for the all India entrance tests such as National Eligibility cum Entrance Test, Joint Entrance Examination (Mains), Joint Entrance Examination (Advanced) or such other tests to make them eligible for admission only against any Non-Resident Indian seat or any supernumerary seat; Provided that the OCI cardholder shall not be eligible for admission against any seat reserved exclusively for Indian citizens.”

These provisions and notifications are crucial in understanding the legal rights that were initially granted to OCI cardholders and how these rights were subsequently altered by the 2021 notification. The interplay between these statutory provisions and notifications forms the core of the legal challenge.

Arguments

The petitioners, primarily represented by Mr. P. Chidambaram and Mr. K.V. Viswanathan, argued that the notification dated 04.03.2021 violated the rights of OCI cardholders. Their main arguments can be summarized as follows:

• Parity with NRIs: OCI cardholders have been treated on par with NRIs since 2005, especially in education. This parity allowed them to compete for all seats, not just NRI seats. The 2021 notification unfairly restricts them to NRI or supernumerary seats.
• Violation of Articles 14 and 21: The petitioners contended that the notification violates Article 14 (equality before the law) and Article 21 (protection of life and personal liberty) of the Constitution. They argued that these rights are available to “persons,” not just citizens, and OCI cardholders, who are long-term residents of India, should not be discriminated against.
• Doctrine of Non-Retrogression: The notification goes against the principle of non-retrogression, as it withdraws rights that OCI cardholders have enjoyed for many years.
• Legitimate Expectation: OCI cardholders had a legitimate expectation that their rights would continue, especially since many have lived and studied in India for years.
• No Prejudice to Indian Citizens: The petitioners argued that even when OCI cardholders were allowed to compete for all seats, many seats remained vacant. Thus, the restriction is unnecessary and arbitrary.
• “Things Done”: The petitioners contended that their actions, such as completing their education in India, should be protected as “things done” before the supersession of earlier notifications.

The respondents, represented by Ms. Aishwarya Bhati, the Additional Solicitor General, countered these arguments by stating that:

• Sovereign Power: The government has the sovereign power to determine the rights and privileges of non-citizens. The OCI regime is a privilege, not a right, and the government can change it.
• Parity with NRIs: The government argued that the intention was always to treat OCI cardholders on par with NRIs, not Indian citizens. The 2021 notification clarifies this position.
• Protection of Indian Citizens: The government’s rationale is to protect the rights of Indian citizens, given the limited number of seats in educational institutions.
• No Fundamental Rights: The respondents argued that OCI cardholders, being foreigners, cannot claim fundamental rights under Articles 14, 19, and 21 of the Constitution, which are primarily for citizens.
• Policy Decision: The decision to issue the 2021 notification was a policy decision, made after consultations, and should not be interfered with by the court.

The core of the petitioners’ argument is that the notification is arbitrary, discriminatory, and violates the principle of non-retrogression. The respondents, on the other hand, emphasize the sovereign power of the state and the need to protect the interests of Indian citizens.

Submissions Table

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame specific issues in a separate section. However, the core issue that the court addressed was whether the notification dated 04.03.2021, which restricted OCI cardholders to only NRI or supernumerary seats, was valid. This involved the following sub-issues:

1. Whether the notification dated 04.03.2021, validly supersedes the earlier notifications of 2005, 2007 and 2009.
2. Whether the proviso to clause 4(ii) and Explanation (1) of the notification dated 04.03.2021 is discriminatory and violative of Article 14 of the Constitution.
3. Whether the notification dated 04.03.2021, has a retroactive effect and whether it takes away the rights of the OCI cardholders who were conferred the right earlier.
4. Whether the notification dated 04.03.2021, is against the principle of non-retrogression.
5. Whether the notification dated 04.03.2021, is arbitrary and violative of the principles of natural justice.

Treatment of the Issue by the Court

The following table demonstrates how the Court dealt with the issues:

Authorities

The Supreme Court relied on several cases and legal provisions to reach its decision. These authorities are categorized below:

On the Principle of Equality and Non-Arbitrariness:

• Maneka Gandhi vs. Union of India [1978 (1) SCC 248]: The court cited this case to emphasize that unreasonable classification is not permissible under Article 14 of the Constitution. It highlighted that equality is antithetical to arbitrariness.
• LIC Vs. Consumer Education and Research Centre [1995 (5) SCC 482]: This case was cited to emphasize that every activity of a public authority must be informed by reasons and guided by public interest.

On the Doctrine of Non-Retrogression:

• Navtej Singh Johar & Ors. vs. Union of India Thr. Secretary Ministry of Law and Justice [2018 (10) SCC 1]: The court referred to this case to discuss the doctrine of non-retrogression, stating that there should not be any regression of rights.

On “Things Done” and Legitimate Expectation:

• Universal Import Agency and Anr. v. The Chief Controller of Imports and Exports and Ors. [1961 (1) SCR 305]: This case was relied upon to argue that the “things done” before the supersession of a law should be protected.
• Navjyoti Coop. Group Housing Society and Ors. Vs. Union of India & Ors. [1992 (4) SCC 477]: The court cited this case to support the principle of “legitimate expectation,” which means that authorities should not defeat expectations without a valid reason.

On Ultra Vires and Subordinate Legislation:

• J.K. Industry Ltd. vs. Union of India [2007 (13) SCC 673]: This case was used to explain the doctrine of ultra vires, stating that subordinate legislation can be questioned if it is arbitrary or contrary to the statute.

On Policy Decisions and Classification:

• State of Punjab and Ors. Vs. Ram Lubhaya Bagga & Ors. [1998 (4) SCC 117]: This case was cited to emphasize that courts should not interfere with policy decisions unless they are arbitrary or violate the law.
• Izhar Ahmed Khan & Ors. vs. Union of India [AIR 1962 SC 1052]: This case was cited to argue that the status of citizenship can be affected by a statute.
• Indo-China Steam Navigation Co.Ltd. vs. Jasjit Singh & Ors. [AIR 1964 SC 1140]: This case was used to argue that foreigners cannot claim the benefits of Article 19 of the Constitution.
• State of A.P. vs. Khudiram Chakma [1994 Supple 1 SCC 615]: This case was cited to argue that fundamental rights under Article 19 are not available to foreigners.
• Hans Muller of Nurenburg Vs. Superintendent, Presidency Jail, Calcutta & Ors. [AIR 1955 SC 367]: This case was cited to argue that the Foreigners Act gives the government unfettered discretion to expel foreigners.
• State of W.B. Vs. Anwar Ali Sarkar [AIR 1952 SC 75]: This case was cited to explain that classification is permissible if it is based on a real and substantial distinction related to the object sought.
• Budhan Choudhary Vs. State of Bihar [1955 (1) SCR 1045]: This case was cited to explain the conditions for a valid classification under Article 14.
• State of Kerala Vs. N.M. Thomas [1976 (2) SCC 310]: This case was cited to argue that equality means parity of treatment under parity of conditions.
• K. Thimmappa Vs. Chairman, Central Board of Directors [2001 (2) SCC 259]: This case was cited to argue that mere differentiation does not amount to discrimination.

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

✓ Maneka Gandhi vs. Union of India [1978 (1) SCC 248]*: The Court used this case to highlight that equality is antithetical to arbitrariness and that unreasonable classification is not permissible.

✓ Navtej Singh Johar & Ors. vs. Union of India [2018 (10) SCC 1]*: The Court referred to this case to discuss the doctrine of non-retrogression, but noted that its application depends on the nature of the rights involved.

✓ Universal Import Agency and Anr. v. The Chief Controller of Imports and Exports and Ors. [1961 (1) SCR 305]*: The Court used this case to support the argument that “things done” before the supersession of a law should be protected.

✓ Navjyoti Coop. Group Housing Society and Ors. Vs. Union of India & Ors. [1992 (4) SCC 477]*: The Court used this case to support the principle of “legitimate expectation,” stating that authorities should not defeat expectations without valid reasons.

✓ J.K. Industry Ltd. vs. Union of India [2007 (13) SCC 673]*: The Court used this case to explain that subordinate legislation can be questioned if it is arbitrary or contrary to the statute.

✓ State of Punjab and Ors. Vs. Ram Lubhaya Bagga & Ors. [1998 (4) SCC 117]*: The Court used this case to emphasize that courts should not interfere with policy decisions unless they are arbitrary or violate the law.

✓ Izhar Ahmed Khan & Ors. vs. Union of India [AIR 1962 SC 1052]*: The Court used this case to argue that the status of citizenship can be affected by a statute.

✓ Indo-China Steam Navigation Co.Ltd. vs. Jasjit Singh & Ors. [AIR 1964 SC 1140]*: The Court used this case to argue that foreigners cannot claim the benefits of Article 19 of the Constitution.

✓ State of A.P. vs. Khudiram Chakma [1994 Supple 1 SCC 615]*: The Court used this case to argue that fundamental rights under Article 19 are not available to foreigners.

✓ Hans Muller of Nurenburg Vs. Superintendent, Presidency Jail, Calcutta & Ors. [AIR 1955 SC 367]*: The Court used this case to argue that the Foreigners Act gives the government unfettered discretion to expel foreigners.

✓ State of W.B. Vs. Anwar Ali Sarkar [AIR 1952 SC 75]*: The Court used this case to explain that classification is permissible if it is based on a real and substantial distinction related to the object sought.

✓ Budhan Choudhary Vs. State of Bihar [1955 (1) SCR 1045]*: The Court used this case to explain the conditions for a valid classification under Article 14.

✓ State of Kerala Vs. N.M. Thomas [1976 (2) SCC 310]*: The Court used this case to argue that equality means parity of treatment under parity of conditions.

✓ K. Thimmappa Vs. Chairman, Central Board of Directors [2001 (2) SCC 259]*: The Court used this case to argue that mere differentiation does not amount to discrimination.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily driven by a sense of fairness and equity. While acknowledging the government’s power to make policy decisions, the court emphasized that such decisions must be reasonable, non-arbitrary, and based on the application of mind. The court was particularly concerned about the adverse impact of the notification on OCI cardholders who had been residing and studying in India for many years and had planned their future based on the rights that were previously conferred to them.

The court noted that the government’s stated objective of protecting Indian citizens was not supported by data, as many seats remained vacant even when OCI cardholders had full access. It was also noted that the notification was not a reasonable way to achieve this. The court also took note of the fact that the OCI cardholders are mostly children of Indian citizens who have been residing in India for a long time and have pursued their entire education in India.

The court also considered the doctrine of non-retrogression and the principle of legitimate expectation, although it clarified that the rights of OCI cardholders were statutory and not constitutional.

Sentiment Analysis of Reasons Given by the Supreme Court

Ratio Analysis

The ratio decidendi of this case is that while the government has the power to make policy decisions regarding OCI cardholders, such decisions must be reasonable, non-arbitrary, and based on a proper application of mind. The court emphasized that the government cannot take away previously granted rights without a valid reason and that the principle of non-retrogression and legitimate expectation must be considered.

Step-by-Step Analysis of the Court’s Reasoning for each issue:

1. Validity of the notification dated 04.03.2021:
   • The court acknowledged that the government has the power to issue notifications under Section 7B(1) of the Citizenship Act, 1955.
   • However, the court held that this power must be exercised reasonably and cannot be used to take away previously granted rights arbitrarily.
   • Therefore, the notification was deemed valid in principle, but not in its retroactive application.
2. Discrimination and violation of Article 14:
   • The court noted that Article 14 applies to “persons,” not just citizens, and OCI cardholders are “persons” residing in India.
   • The court found that the notification created an unreasonable classification by treating OCI cardholders differently from Indian citizens for educational purposes without a valid reason.
   • The court concluded that the notification was discriminatory and violated Article 14.
3. Retroactive effect of the notification:
   • The court determined that while the notification was prospective, its effect was retroactive because it took away the rights of OCI cardholders who had already acted based on earlier notifications.
   • The court held that this retroactive effect was not permissible.
4. Principle of non-retrogression:
   • The court acknowledged the importance of the principle of non-retrogression, which suggests that rights should not be taken away.
   • However, the court clarified that the rights of OCI cardholders were statutory and not constitutional, so the principle of non-retrogression was not as strong as it would be for constitutional rights.
5. Arbitrariness and violation of natural justice:
   • The court found that the notification was arbitrary because it was not based on data or a proper application of mind.
   • The court noted that the government’s rationale of protecting Indian citizens was not supported by evidence, as seats were still vacant even when OCI cardholders had full access.
   • The court concluded that the notification was arbitrary and violated the principles of natural justice.

Final Order

The Supreme Court issued the following final orders:

1. The notification dated 04.03.2021 was upheld in principle.
2. The proviso to clause 4(ii) and Explanation (1) of the notification dated 04.03.2021 were held to be arbitrary and discriminatory.
3. The court held that the notification cannot operate retroactively.
4. The court directed that the OCI cardholders who had taken the NEET examination based on the notifications of 2005 and 2009 should be considered for admission to medical colleges as per the earlier rules.
5. The court directed the Central Government to issue a fresh notification in the matter, keeping in mind the observations made in the judgment.

Significance of the Judgment

The Supreme Court’s judgment in the case of Anushka Rengunthwar vs. Union of India is significant for several reasons:

• Protection of OCI Cardholders’ Rights: The judgment protects the educational rights of OCI cardholders, particularly those who have been residing and studying in India for many years. It ensures that they are not arbitrarily denied opportunities they had previously enjoyed.
• Limitation on Government’s Power: The judgment highlights that while the government has the power to make policy decisions, such decisions must be reasonable, non-arbitrary, and based on a proper application of mind. It sets a precedent that the government cannot arbitrarily take away previously granted rights.
• Emphasis on Fairness and Equity: The court’s decision emphasizes the principles of fairness and equity, ensuring that OCI cardholders are not discriminated against. It underscores that the state must act in a way that is just and equitable to all persons residing within its jurisdiction.
• Application of the Doctrine of Non-Retrogression: The judgment reinforces the doctrine of non-retrogression, even though the court clarified the rights of OCI cardholders are statutory and not constitutional. It sets a precedent that the government should not take away rights without a valid reason.
• Guidance for Policy-Making: The judgment provides guidance for future policy-making, emphasizing the need for data-driven decisions and proper application of mind. It also highlights that the government must consider the legitimate expectations of those who are affected by policy changes.

Impact on OCI Cardholders

The judgment has a significant positive impact on OCI cardholders:

• Access to Educational Opportunities: OCI cardholders who were eligible for admission under the earlier rules will now be considered for admission to medical colleges. This ensures that they are not unfairly denied educational opportunities.
• Sense of Security: The judgment provides a sense of security to OCI cardholders, assuring them that their rights will be protected by the courts.
• Reduced Discrimination: The judgment reduces the discrimination faced by OCI cardholders, ensuring that they are treated fairly and equitably.

Broader Implications

The judgment has broader implications for policy-making:

• Need for Data-Driven Decisions: The judgment highlights the need for data-driven decisions, emphasizing that policy changes must be based on evidence and a proper assessment of the situation.
• Importance of Consultation: The judgment suggests that the government should consult with stakeholders before making significant policy changes, especially those that impact the rights of persons.
• Balance between State Power and Individual Rights: The judgment emphasizes the need to balance the state’s power to make policy decisions with the need to protect the rights and legitimate expectations of individuals.

Flowchart of the Case