Section 139AA of the Income Tax Act by the Finance Act, 2017, makes Aadhaar mandatory for filing Income Tax Returns. By the impugned provision, Aadhaar has been made mandatory for obtaining PAN, continued validity of PAN and for filing of return under the Income Tax Act.
Two different petitions, challenging Section 139AA, were heard by the Supreme Court Bench of Justices AK Sikri and Ashok Bhushan. One of the petitions had been filed by SG Vombatkere, a retired Indian Army Officer and Bezwada Wilson, founder and convenor of Safai Karmachari Andolan. Another petition had been filed by CPI leader Binoy Viswam.
The petitioners have contended that the object of Income Tax Act is to levy tax on the income earned by a person and to provide a mechanism for payment and collection of the same. According to them, parting with biometrics has no rational nexus to the said object and creates a wrongful classification amongst a homogeneous group of tax payers.
The apex court admitting the petitions debated the legality of a centralized biometric-based database of India’s 1.2 billion citizens.
To this, Mukul Rohatgi responded that the central government’s only option was to make Aadhaar mandatory to end the black money menace. “We found a number of pan cards being used to divert funds to shell companies, to prevent it the only option is to make Aadhaar card mandatory,” said Rohatgi.
The Supreme Court of Friday then furiously asked Attorney General (AG) Mukul Rohatgi to justify making Aadhaar mandatory for filing Income Tax returns as it is a complete violation of the court’s previous order. "Is making Aadhaar by force the only way to tackle fraud?"
Earlier Supreme Court had on March 27 made it clear that Aadhaar cannot be made mandatory by the government for extending benefits of social welfare schemes.
The top court said that the government cannot be barred from seeking these cards, which are issued by UIDAI, for "non-benefit" purposes like filing of IT returns and opening of accounts.
"The answer is this that for giving benefits of welfare schemes, it (Aadhaar) cannot be pressed. They (government and its agencies) cannot be stopped from seeking Aadhaar for non-benefit schemes like opening of bank accounts," a bench headed by Chief Justice J S Khehar had said.
In 2015, the Supreme Court had said that Aadhaar card should not be made mandatory for government schemes.
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