The bill was passed in Lok Sabha with 385 members voting in support and no opposition to it.
The opposition parties decided to "cooperate" with the government for the smooth passage of the bill and suspend their protest in the House.
It was moved by social justice and empowerment minister Virendra Kumar, who termed it as historic legislation that 671 castes in the country would benefit from it.
Kumar said the bill will restore the states' rights to prepare their own lists of OBCs so that various communities can be given social and economic justice.
The minister said the bill should be considered as the 105th Constitution Amendment bill after being renumbered.
Responding to the demands for increasing reservation beyond 50 per cent, the minister said the government understands the feelings of the members. He said that the courts have repeatedly emphasised this ceiling and there is a need to give attention to the constitutional aspects.
The Parliament had in August 2018 passed a constitution amendment bill to give constitutional status to National Commission for Backward Classes.
The 102nd Constitution Amendment Act of 2018 inserted articles 338B, which deals with the structure, duties and powers of the National Commission for Backward Classes, and 342A that deals with the powers of the president to notify a particular caste as an SEBC and the power of Parliament to change the list. Article 366 (26C) defines SEBCs.
The Supreme Court has dismissed the Centre's plea seeking a review of its 5 May majority verdict that held that the 102nd Constitution amendment took away the states' power to notify SEBCs for the grant of quota in jobs and admissions.
Opposition parties had accused the Centre of assaulting the federal structure by taking away the power of the states to identify and list the Other Backward Classes (OBCs).