He noted that the extreme backward classes will be sub-classified naturally and that the Commission will submit its recommendations in 12 weeks.

"After independence, in Prime Minister Modi's Government, unprecedented steps are taken to give justice to backward classes," Chouhan asserted.

The income limit defining "creamy layer" for the OBC reservation has been raised by Rs two lakh per annum even as the Union cabinet today approved setting up of a panel for sub-categorisation within the other backward classes for even distribution of reservation benefits.

The government also ruled out having a relook at the present reservation system.

Union Finance Minister Arun Jaitley told the reporters here that the Union Cabinet was today formally apprised of the decision to hike the limit for central government jobs.

He said that Prime Minister Modi had recently hinted in Assam that the bar defining creamy layer would be raised and the procedure of formally informing the cabinet about the decision was completed today.

The ministry of social justice and empowerment had proposed that the OBC families which earn more than Rs. eight lakh per year should be classified as 'creamy layer', the ceiling which bars members of the other backward classes from availing reservations in employment.

There had been three revisions of the creamy layer bar.

It was fixed at Rs one lakh in 1993 and hiked to Rs 2.5 lakh in 2004 and Rs 4.5 lakh in 2008.

The present ceiling of Rs six lakh came into being in 2013.

Jaitley also announced the decision of the cabinet to set up a commission to work out sub-categorisation within other backward classes for a "more equitable distribution of reservation benefits amongst the OBCs."

He said that 11 states of Andhra Pradesh, Telangana, Puducherry, Karnataka, Haryana, Jharkhand, West Bengal, Bihar, Maharashtra, Tamil Nadu and Jammu region only of Jammu and Kashmir have already carried out sub-categorisation of OBCs. (ANI)