Aadhaar Verdict: Govt. Learns The Hard Way

The Supreme Court of India’s September 26 judgment in K. S. Puttaswamy vs. Union of India (Aadhaar case) is a first-hand lesson on good governance and constructive use of state power for the Government. Four of the five judges of the Constitution Bench came down heavily on the government for using Aadhaar as a tool to create a surveillance state in India, that is, by extending it to almost every aspect of human activity and life.

Aadhaar was originally conceived by the Congress-led UPA government as an alternative mechanism for direct delivery of government benefits. However, the Government’s Aadhaar—which was conveniently rushed through in the Lok Sabha as a Money Bill without any discussion or debate in the Rajya Sabha—is significantly different and overarching and what started as a targeted delivery scheme for the marginalized was soon transformed, and insensitively so, into a biometric-based surveillance technology for every Indian.

In recent past, Aadhaar ceased to be known as a unique identification number in the lives of the ordinary people and acquired the status of a document required to access basic services such as birth and death certificates, for crematoriums and burials, for school admissions and writing examinations, for opening and closing of bank accounts, for purchase or exchange of SIM cards, among other things. No concession was given to children or to the differently-abled. More than 14 crore Indians were denied basic public benefits due to authentication failure. Over 20 Indians lost their lives in the process.

In a welcome verdict, the Supreme Court has struck down certain offending provisions in their present form so as to prevent the Government from using Aadhaar as a weapon to create a surveillance state. The court curtailed the requirement of insisting on Aadhaar for several activities and limited the import of the scheme to aspects directly related to welfare benefits, subsidies and monies spent from the Consolidated Fund of India. Further, a person cannot be denied the benefit of schemes if, for some reasons, that person is unable to produce Aadhaar and benefit shall be given by verifying the identity of that person on the basis of other documents.

As we know, the government had amended the Prevention of Money Laundering Rules to mandate the linking of Aadhaar to bank accounts held by billions of Indians (as per data available, more than half of the total number of banks in India were in fact so linked). In many cases, banks went on to the extent of blocking accounts of non-compliant customers. The Supreme Court minced no words in holding that the government was wrong in forcing citizens to link their Aadhaar numbers to bank accounts and financial instruments such as mutual funds and insurance policies. Likewise, the Supreme Court declared as unconstitutional the notification issued by the Department of Telecommunications that mandated linking of Aadhaar to mobile phone numbers. The court said that data collected shall be deleted within six months and citizens have a right to file cases of misuse or theft of data against the government.

Though the majority judgment held that the Aadhaar Act was a Money Bill and must be passed in the Parliament as such, the court did rule that the decision of the Speaker on whether a Bill is a Money Bill or not comes within the purview of judicial review—a landmark observation that will prevent the unlawful and arbitrary exercise of discretion by the Speaker. For instance, as Kapil Sibal has pointed out, the Government will soon need to introduce an Amendment Bill in Parliament to make appropriate changes to the Aadhaar Act in line with the directions issued by the court. When such an Amendment Bill is introduced and, if it classified by the Speaker as a Money Bill as is expected, then the decision of the Speaker can be challenged on ground that it is not a Money Bill (so eventually, a plea could be made to refer the court’s verdict to a larger, seven-Judge bench). Justice Chandrachud’s scathing dissent—that the Government’s implementation of the Aadhaar through a Money Bill is a fraud on the Constitution—will no doubt be of particular significance in such an eventuality.

Of course, there are certain aspects of the majority judgment that raise concern, one of which is the upholding of Section 139AA of the Income Tax Act, which requires linking of Aadhaar to permanent account number (PAN) for income tax purposes. The court has not convincingly answered why linking Aadhaar to PAN is less disproportionate than linking it to, say, bank accounts.  That said, the verdict is fairly balanced and removes most defects purposefully introduced by the Government from time to time. The government has hurriedly owned the verdict to save itself from public embarrassment but the reality is that the Supreme Court has called the government’s bluff on Aadhaar and it is likely that the demonetization scheme—when finally heard in court—will too meet a similar fate.

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