Those Without Aadhaar Can Still File Income Tax Returns: Supreme Court
The apex court also did not strike down Section 139AA of the Finance Act.
The Supreme Court ruled on Friday that Aadhaar will not be mandatory to file income tax returns for those who do not possess an Aadhaar identification number currently. PAN card holders who already have Aadhaar will have to link the two, the apex court said.
The court did not strike down Section 139AA of the Income Tax Act, 1961 but said that as an interim measure, Aadhaar will not be mandatory to file returns for taxpayers who don’t have the identification number.
The partial stay on mandatory Aadhaar for filing tax returns will remain in place until the issue of “right to privacy” is decided by the constitutional bench, a two-judge Supreme Court bench headed by Justice AK Sikri said. The bench hoped the government will address security issues related to Aadhaar data soon.
Elaborating on the order, Salman Khurshid, counsel for one of the petitioners said, “Partial relief for the citizen is, if you don't have an Aadhaar card, you are not going to get every transaction of yours based on a PAN card invalidated. If you want to get an Aadhaar card, you are free to do so. If you don't get an Aadhaar card, your transactions and returns on the basis of your PAN card will still remain valid.”
Finally this will be decided by the Constitutional bench. They’ve only decided this issue temporarily, saying the rest of the issues, the larger issue of citizens and so on will be decided by the Constitutional bench.Salman Khurshid, Petitioner’s Counsel
The apex court’s verdict on Friday came on a batch of petitions challenging Section 139AA of the Income Tax Act, which was added through the Finance Act 2017 to make Aadhaar-PAN linkage mandatory for tax filing purposes.
The petitioners had objected to the provision citing that Aadhaar was voluntary and that it violated right to bodily integrity.
What The Petitioners Said
The petitioners, represented by Senior Advocates Shyam Divan and Arvind Datar, had argued that Section 139AA was against the apex court’s order that had said Aadhaar is voluntary.
Divan had argued that there is complete collision between the Aadhaar Act and Section 139AA of the Income Tax Act, 1961 in as much as it is a “colourable exercise of legislative power” which converts a right into a duty.
During the hearing, emphasising that the judgment will have far-reaching consequences, Datar had said if Section 139AA is upheld, what stops the government from making Aadhaar mandatory for the Goods and Services Tax (GST).
Now their purpose is to promote Aadhaar so they say it will solve everything from black money to terror funding. They talk about economy of the country and also about international relations. Is this some kind of a herbal medicine?Arvind Datar, Senior Advocate (During The Course Of The Hearing)
Divan had argued “as far as my biometrics are concerned, the State cannot take it without consent except for limited purposes. The object of the statute is discriminatory because it creates an artificial class of assessees who are otherwise willing to pay taxes but refused to give their biometrics as conscientious objectors”.
What The Government Said
Attorney General Mukul Rohatgi, representing the government, had called the arguments against Aadhaar “much ado about nothing”.
Collecting biometrics does not mean “Uncle Sam is snooping on you”, AG had said, arguing that bodily integrity is not an absolute right and can be curtailed by procedures laid down by the law.
Bodily integrity is not absolute. There are so many certifications we give our biometrics for such as driving licence, buying property, etc... Photo identity and fingerprints have been there for different services. Only change here is that now fingerprint is taken on an electronic device.Mukul Rohatgi, Attorney General for India
Rohatgi had argued that while there are multiple PAN cards for a single individual, such duplication is almost non-existent with Aadhaar. “People had multiple PAN cards; there were shell companies,” he said. He cited a case under investigation where “PAN mischief by one person was Rs 5,000 crore”. During the course of the argument, the AG had also submitted the details in a sealed cover to the apex court.
The “purpose is checking of black money, terror financing, money laundering, ensuring proper tax collection, bringing transactions to book.” This entire issue is not of dealing with a demon but with someone who will give you more orderly life, he said.