Building a legal ecosystem for Aadhaar

There is an untenable tension between the approaches of the executive and the judiciary to Aadhaar


NDA’s recent move to make an individual’s Aadhaar number mandatory for filing tax returns or obtaining and retaining a PAN card shows that ambiguities remain. Illustration: N. Jayachandran
NDA’s recent move to make an individual’s Aadhaar number mandatory for filing tax returns or obtaining and retaining a PAN card shows that ambiguities remain. Illustration: N. Jayachandran

For all the scandals and misgovernance that marked the United Progressive Alliance’s second term, it took one crucial step: It started the Aadhaar programme. The National Democratic Alliance (NDA) government continued the good work. Its Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Bill, passed last year, gave statutory backing to a programme that has the potential to be transformative for governance. But the NDA’s recent move to make an individual’s Aadhaar number mandatory for filing tax returns or obtaining and retaining a PAN card shows that ambiguities remain.

The tax returns move comes soon after the Union government notified the expansion of Aadhaar to cover over 30 schemes. An Aadhaar number will now be mandatory for ex-gratia payments to Bhopal gas leak victims, the Sarva Shiksha Abhiyan, Bonded Labour Rehabilitation Scheme, National Action Plan for Skill Training of Persons with Disabilities and National Health Mission, for instance. The diverse nature of the schemes makes it clear that the government sees it as an essential tool that can be used at nearly any point of contact between state and citizen.

We have noted the many benefits of the Aadhaar programme in these pages. That has not changed. It presents a unique opportunity to improve governance processes and outcomes. Bridging the many gaps in existing benefits systems helps citizens on multiple levels. It ensures delivery of benefits to those who need them. By preventing leakages and siphoning of funds, it saves taxpayer money. And by underwriting the shift to direct benefits transfers, it reduces the points of contact between state and citizens, thus reducing retail corruption, the most persistent and intrusive form of corruption.

But it is incumbent upon the government to ensure that Aadhaar is statutorily foolproof. It has not managed to do so. There are two main issues here. The first is that the government’s approach is at odds with the Supreme Court’s. In August 2015, a three-judge Supreme Court bench allowed the government to use Aadhaar for the public distribution system and for distributing liquefied petroleum gas cylinders. In October that same year, the Supreme Court also allowed the government to use Aadhaar for the Mahatma Gandhi National Rural Employment Guarantee Scheme and the Prime Minister’s Jan Dhan Yojana, among a handful of schemes. In both instances, however, it stipulated that the Aadhaar scheme must remain voluntary and could not be made mandatory until such time as the matter was finally decided.

The government’s ignoring of this stipulation sets up an untenable tension between the approaches of the executive and the judiciary to Aadhaar. The increasingly expansive nature of the scheme and its growing pervasiveness in citizens’ lives mean that its legal status and limits cannot be ambiguous. The responsibility for finding a modus vivendi admittedly does not rest entirely with the executive; the judiciary has been tardy in hearing Aadhaar cases and taking a final call. With chief justice of India J.S. Khehar saying that a five-judge bench will hear Aadhaar cases from May, there is movement on this front. Until such time as there is legal clarity, the government cannot simply ignore court directives. Doing so leaves the scheme open to potentially disruptive litigation; it sets an undesirable precedent; and it entrenches the idea that citizens’ rights are an acceptable price to pay for efficient governance.

The second issue pertains to Aadhaar’s growth beyond subsidies and benefits in a legal environment that lacks an essential component for such an expansion. As far as making Aadhaar mandatory for tax returns goes, this is not without logic; it is a more certain method of tackling tax evasion than the PAN card. But there are also questions. What will be the threshold of suspicion of tax evasion beyond which investigations will be launched? Given the particularly sensitive context, what will be the regulations on database sharing? Meanwhile, expansion in other areas—such as mandatorily linking Aadhaar to mobile phone numbers, as the Supreme Court has ordered in contravention of its own prior judgments—is both puzzling and unnecessary.

Legal checks and balances are essential here. A right to privacy is the most important—and best—answer. At a hearing in July 2015 pertaining to various petitions challenging the validity of the Aadhaar project, attorney general Mukul Rohatgi asserted that the Indian Constitution does not guarantee a right to privacy. He is correct. In 1954 and then in 1964, benches of eight and seven judges, respectively, ruled that there was no fundamental right to privacy. The government has said that it is drafting a privacy Bill to address the issue—but its failure to provide a timeline or show any urgency points to its disinterest.

The current issues with Aadhaar do not prove malicious intent on the part of the government. Portraying it as a tool for the establishment of a quasi-police state, as some of the scheme’s detractors have done, is absurd. But where the government has faltered is in adopting a predominantly instrumentalist approach. In a matter of such scope and importance—for governance and individuals alike—that is insufficient. A legal ecosystem for Aadhaar that is grounded in constitutionality is essential. The Aadhaar Bill was a good first step—but neither the government nor the Supreme Court have followed up adequately.

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