Indian government and its social media handles have been celebrating the so called wins in Supreme Court claiming allowing of mandatory use of Aadhaar for mobile re-verification and Aadhaar-PAN linking. But these celebrations are not only premature but also based on wrong assumptions and interpretations of Supreme Court judgments, especially the interim order (pdf) of Constitution Bench of Supreme Court.
Let us first discuss the mobile re-verification case. According to the government, Supreme Court ordered it to re-verify mobile connection using Aadhaar based EKYC. Obviously this claim is far from truth as Supreme Court has nowhere asked Indian government to use Aadhaar for mobile re-verification or similar purposes. People are free to use any traditional government document to complete KYC formalities of various telecom companies. Aadhaar is not mandatory for mobile connection verification or re-verification purposes. No mobile connection can be disconnected or otherwise limited for not doing Aadhaar based EKYC/KYC.
Now let us analyse the Section 139AA case recently heard by Supreme Court. Government is claiming a big win here as well. In reality, Supreme Court has made Aadhaar optional for all practical purposes. Section 139AA (1) has only been declared partially constitutional without a rigorous test of Article 21. Further, even this limited constitutionality of Section 139AA (1) is subject to final decision of the Constitution Bench of Supreme Court that would analyse violation of various Fundamental Rights by Aadhaar. Above all, eligibility for Aadhaar cannot be interpreted as a mandate or compulsion to obtain an Aadhaar. So if an individual is not interested in getting an Aadhaar, Section 139AA (1) cannot force him/her to get an Aadhaar.
Let us further analyse what Supreme Court said about Section 139AA (2). Section 139AA (2) is only supported by limited constitutional validity and subject to the final decision of Constitution Bench. Further, Section 139AA (2) has been severely read down by Supreme Court. So PAN of an individual would not be cancelled if he/she fails to link it with Aadhaar as Article 21 analysis was not done. Not only this, even cancelling of a PAN cannot be retrospective in nature and can only be prospective. So till the PAN is cancelled, if at all, all transactions would be legal and valid.
A combined reading would prove that Section 139AA as it stands now is impotent and toothless. Its violations would not bring any punitive action from either government or IT department. All individuals, whether having Aadhaar or not, can file their returns without quoting the Aadhaar number and their tax returns would not be rejected.
Anticipating this defeat, Indian government notified the Prevention of Money Laundering (Maintenance of Records) Second Amendment Rules 2017. The purpose was to ensure forced clubbing of Aadhaar with PAN through the banking channel. However, Aadhaar is not mandatory for this so called money laundering aspect as well due to the recent judgment of Supreme Court on Section 139AA and the interim order of Constitution Bench of Supreme Court.
Nevertheless, Indian government would keep on insisting that Aadhaar has been made mandatory under the mobile re-verification and Section 139AA cases. To clear all doubts, Perry4Law Organisation (P4LO) has consolidated the constitutional position regarding Aadhaar at a single place.
Now here is the beauty of this exercise and constitutional analysis. If the government says that the division benches of Supreme Court have made Aadhaar mandatory for mobile re-verification and Section 139AA cases, their judgments would automatically become Per Incuriam. A division bench can never overrule a Constitution Bench order that is still pending for final adjudication. Even a three judge bench has clearly made Aadhaar optional. So we have prohibitive orders from both three judge bench and a Constitution Bench against which government cannot make Aadhaar mandatory.
The Constitution Bench has only allowed certain limited purposes for which Aadhaar can be used and beyond those purposes Aadhaar cannot be used. Even for those limited purposes, Aadhaar is absolutely optional.
The net effect of this position is that Indian government cannot make Aadhaar mandatory for even a single purpose or service, whether welfare or non welfare or government or private.
So we can safely conclude that the judgment of Supreme Court on mobile re-verification and Section 139AA have made Aadhaar optional. Otherwise, they are Per Incuriam and not binding upon any individual or organisation. People can simply ignore them as non binding and without any legal effect.
In any case, Aadhaar remains optional for mobile re-verification, Section 139AA, money laundering notification and all other purposes, whether present or future till Constitution Bench decides the matter ultimately and conclusively.