Madras HC Rejects Plea For Filing I-T Return Sans Aadhaar Number, Enrolment ID [Read Order]

The Madras High Court has refused to allow filing of Income Tax return without producing Aadhaar number and enrolment ID.

Justice TS Sivagnanam dismissed the plea filed by Thiagarajan Kumararaja praying for direction to the I-T department that he be allowed to file his income tax return for the assessment year 2017-18 either manually or through the appropriate e-filing facility without insisting on production of his Aadhaar number and/or his enrolment ID as defined under Section 139AA of the Income Tax Act, 1961.

Petitioner's counsel V Prashanthkiran relied upon the Supreme Court's decision in Binoy Viswam vs Union of India, saying the apex court had granted a partial stay of the proviso under Sub-Section (2) of Section 139AA of the Act.

He also contended that assessees like the petitioner, who have not enrolled under the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act 2016, and who do not comply with the provisions of Section 139AA(2) of the Act, cannot have their Permanent Account Number (PAN) treated as invalid until the Supreme Court hears and determines the larger challenge, in which, the validity of the Aadhaar Act has been assailed.

The petitioner also relied upon the interim stay granted by Justice Sivagnanam to another petitioner, advocate Preeti Mohan allowing her to file I-T returns for the year 2017-18 without Aadhaar.

The court had then observed that if the apex court happens to decide against the petitioner, she will have to pay penalty for late filing of return and therefore, should be granted interim relief.

However, after hearing the arguments in the instant petition, the high court held differently and agreed with the contentions of Additional Solicitor General G Rajagopalan.

"The Hon'ble Supreme Court has not stayed the Proviso to Sub-Section (2) of Section 139AA of the Act and the partial stay would be applicable only to facilitate the other transactions, which are mentioned in Rule 114B of the Rules, which pertains to transactions, in relation to which, PAN is to be quoted in all documents for the purpose of Clause (C) of Sub-Section (5) of Section 139A of the Act.

"Therefore, to state that the partial stay granted by the Hon'ble Supreme Court would ensure to the benefit of the petitioner even for filing income tax returns is a plea, which is not sustainable and is liable to be rejected," said Justice Sivagnanam.

The court also relied upon the apex court observation to say that "it has also been held that the purpose behind the Act namely the Income Tax Act, 1961, is entirely different and the purpose being to curb black money, money laundering and tax evasion, etc.

"It has been further held that for achieving such objects, if the Parliament chooses to make the provision mandatory under the Act, the competence of the Parliament cannot be questioned on the ground that it is impermissible only because under the Aadhaar Act, the provision is directory in nature. The Hon'ble Supreme Court also held that it is the prerogative of the Parliament to make a particular provision directory in one Statute and mandatory/ compulsory in the other and that by itself cannot be a ground to question the competence of the Legislature," it noted.