In a majority decision, the Gujarat High Court had upheld the constitutional validity of the scheme and directed the state government to implement it. The Modi government then approached the Supreme Court.
The Centre's scheme, applicable in all states, is for students belonging to five religious minorities, including Muslims, whose parents earn less than Rs. 1 lakh annually. The Central government pays for 75 per cent of the scholarship amount and states are expected to pick up 25 per cent of the tab.
In today's hearing, the Gujarat government argued that the Centre's scholarship for minorities is a scheme based on religion and the Centre cannot compel the state to implement it.
Gujarat also argued that the state already has a similar scheme for all poor students irrespective of their religion and that the Centre's scheme amounted to discrimination based on religion.
While declining to stay the High Court's order, the Supreme Court said it has to view the matter through the Centre-state relationship prism and issued notice to the Centre, asking it to respond to Gujarat's contention that the scheme is discriminatory. The case will next be taken up in the first week of August.
It was Congress leader Adam Chaki who had first filed a Public Interest Litigation in the Gujarat High Court, asking it to direct the state government to implement the Centre's scheme.