Constitutional Validity of Aadhaar – Background, Major Issues and Recent SC verdict

Recently, the Supreme Court upheld the constitutionality of the Aadhaar in its majority verdict (4 out of 5 judges). It is in this light, there is a need to look up the background of the Aadhaar issue and analyse various verdicts.

Evolution of Aadhaar

  • Concerns about national security is the reason for the origin of Aadhaar. After the report of the Kargil Review Panel, a Group of Ministers suggested a multipurpose National Identity Card. In May 2007, the government released the first set of such cards.
  • Under the National Common Minimum Programme, the need for efficient targeting of government subsidies was felt. Therefore, in 2006, the government released a plan for a “unique ID” (UID) for Below Poverty Line (BPL) families. This was to be executed by the Ministry of Information Technology.
  • But the UID project clashed with that of the National ID.
  • Hence in 2008, it was decided to set up the Unique Identification Authority of India (UIDAI) under the aegis of Planning Commission. The UIDAI was notified in 2009.
  • The 1st 12-digit Aadhaar number was released on September 29, 2010.
  • Now, Aadhaar is the world’s largest biometric and identity database.
  • Around 122 crore numbers were given to Indian citizens or persons living in India for more than 180 days.

Why the Aadhaar was challenged?

Legitimacy: The UIDAI was established by an executive order and thus did not have a legislative base for 7 years. In 2012, the 1st legal challenge to its legitimacy came with the petition of ex- judge K S Puttaswamy challenging Aadhaar. Thus in 2016, the government enacted the Aadhaar (Targeted Delivery of Financial and other Subsidies, Benefits and Services) Act, 2016.

Money bill issue: The Act provided the much required legislative sanction to Aadhaar. But, the government called it a Money Bill during the 2016 Budget Session and passed it in Lok Sabha. Money Bills do not require ratification by Rajya Sabha. (Notably, the current government is in minority in the Rajya Sabha). Ex-Union Minister Jairam Ramesh challenged the Money Bill route utilized for Aaadhar. His case was grouped with a series of other petitions against Aadhaar.

Privacy concerns: The government argues that Aadhaar would help remove ghost beneficiaries of welfare schemes. But the unique identity number could become an instrument for mass surveillance by the state. The electronic records and central data base are created in such a way to track transactions across the life of the citizen. This will facilitate the government to profile citizens, track their movements, evaluate their habits and consequently influence their behaviour.

Over time, the profiling facilitate the state to suppress any dissent and guide the political decision making. It would result in a situation where every basic facility is connected to Aadhaar and one cannot live without an Aadhaar number. Due to these concerns that Aadhaar could be an attack on a person’s privacy, it was challenged in court. In 2016, the Supreme Court declared that privacy is a fundamental right guaranteed and protected by the Constitution.

What were the questions before the SC?

After the privacy judgment, more petitions were submitted along with the pending cases against Aadhaar. Therefore, the 5-judge Constitution Bench had to decide on the following issues:

  1. Government’s right to demand every person to authorise his/her identity with just single proof (a unique identification number) to ensure that government benefits reach their intended targets.
  2. The right of Indian citizens to identify themselves through other documents provided to them by the government, rather than through unique identification number.
  3. The individual privacy issues with the Aadhaar project.
  4. The validity of the Aadhaar Act as it was enacted as a Money Bill.

What are the features of the majority verdict?

  • The majority ruling mentioned Aadhaar “a document of empowerment”. The ruling has highlighted two main features of the unique identification project – Aadhaar as digital identity infrastructure and Aadhaar’s application as public infrastructure for different purpose.
  • Right to privacy – Not every matters related to an individual were a part of the right to privacy. Only those matters in which there was a rational expectation of privacy were protected under Article 21 of the Constitution. In this context, the Aadhaar scheme passed the triple test laid down in the Puttaswamy (Privacy) judgment to check if it invades privacy viz. existence of a law – backed by the statute i.e. the Aadhaar Act, a legitimate state interest – to make sure that social benefit schemes reach the deserving beneficiaries and test of proportionality. Thus it balances the expected benefits of Aadhaar and the possible threat it carries to the fundamental right to privacy.
  • Money Bill – Section 7 of the Aadhaar Act mandates that individuals should show Aadhaar to get access to social services, subsidy, benefits, etc. Furthermore, it is clearly indicated that expenditure incurred in this respect would be from the Consolidated Fund of India (CFOI). Since Section 7 is the primary provision of the Act, the validity of the Aadhaar Act being enacted as a Money Bill is upheld.
  • Surveillance state – During the enrolment process, “less biometric data in the form of iris and fingerprints is collected”. Further, UIDAI “does not collect purpose, location or details of the transaction”. Thus the manner of operation of Aadhaar, “do not lead to creation of a surveillance state”.
  • Security of biometric data – Only registered devices are mandated by UIDAI to conduct biometric-based authentication transactions. With these registered devices, the biometric data is encoded within the device using a key. This establishes a unidirectional relationship between the UIDAI and the host application. This also excludes any possibility of the utilization of stored biometric, or the replay of biometrics collected from another source. Moreover, under the regulations, authorisation agencies are not allowed to store the biometrics collected for Aadhaar authentication.
  • Telecoms – SC held that the re-verification of mobile numbers based on Aadhaar is illegal and unconstitutional as it was not supported by any law. Due to this-telecom cannot mandate customers to provide Aadhaar details, the provision that enabled private entities to do authentications has been held illegal and the corporate bodies including banks, mobile wallets, etc also cannot ask for people’s Aadhaar number.
  • PAN – Section 139AA of IT Act makes Aadhaar compulsory for filing IT returns and applying for PAN. Since it faced the triple test under Puttasamy judgement and did not violate the right to privacy, connecting of PAN with Aadhaar will be compulsory. But there was no deadline mentioned by the court. However, it is also mentioned that if in the regulations, a provision was made that violated the right to privacy, it could be challenged.
  • Linking of bank accounts – Linking of bank accounts and other financial instruments with Aadhaar were made compulsory through 2017 amendment to Prevention of Money Laundering Act Rules, 2005. It does not stand the proportionality test since just for combating money laundering, there cannot be any provision targeting every citizen as a suspicious person, which is seen as inconsistent. Hence it violates the right to privacy of a person which expands to banking details and thus the amendment is declared unconstitutional.
  • Details already given – The judgment does not clearly mentioned if banks/mobile companies that have already collected Aadhar data will have to remove the collected information. However the court has upheld the validity of Section 59, which legalises all Aadhaar enrolment done prior to the enactment of the Aadhaar Act, 2016. The court has declared that since enrolment was not mandatory, those who refuse to provide consent would be allowed to exit.
  • Aadhaar for education – Statutory bodies such as CBSE and UGC cannot ask students to give their Aadhaar cards for examinations like NEET and JEE. Aadhaar would also not be mandatory for school admissions because it is not a service or subsidy, instead a fundamental right for children between 6 and 14.
  • Aadhaar for children ­- The permission of parents/guardians will be required for the enrolment of children under the Aadhaar Act. On reaching the age of majority, such children shall have the choice to exit.
  • Section 33(1), Aadhaar Act – It prevents disclosure of information (identity and authentication), except when it is by an order of a district judge or higher court. The judgment facilitated individuals to have a right to challenge such an order passed by approaching the higher court.
  • Section 33(2), Aadhaar Act – It enables disclosure of information in the interest of national security when an officer of Joint Secretary or higher rank issues a direction. The court removed this provision in the current form. It declared that an officer higher than this rank should be provided such a power and a Judicial Officer (particularly an HC judge) should also be linked with it.
  • Section 47, Aadhaar Act – It provides for cognisance of offence only through complaint by UIDAI (or any person approved by it). The court held that this required suitable amendment to enable filing of complaints also by an individual whose right was violated.
  • Section 57, Aadhaar Act – It provides for use of Aadhaar number for setting up of the identity of an individual for any use, by the state or any corporate or person. The court held that the section would violate the right to privacy of the individual and facilitate commercial exploitation of biometric and demographic information. The court thus struck down this provision as susceptible to misuse.
  • Regulation 26(c), Aadhaar Regulations – It enabled UIDAI to store metadata with respect to transactions. The court struck down this regulation in its current form.
  • Regulation 27 – It enabled archiving transaction data for five years. The court struck down this and authorised only up to six months.

What is the rationale behind the majority judgement? (pros of the majority verdict)?

  • The failure to create the identity of an individual is a major obstacle to the successful implementation of welfare programmes.
  • Absence of an efficient system to authenticate identity made it harder for subsidies/benefits/services to reach the targeted beneficiaries.
  • The Aadhaar project thus assures dignity for marginalised communities along with services, benefits and subsidies by utilizing the power of technology.
  • The use of Aadhaar had also raised over time. The enrolment reached 1.2 billion people, and the programme had got a scale and momentum that is unalterable.
  • Required measures were also taken to assure security of information given by individuals while enrolling.
  • Hence the Court upheld the constitutional validity of Aadhaar and explained areas in which it cannot be made compulsory.
  • The judgement has thus plugged the loopholes instead of striking down the project altogether.

What are the key features of the minority judgment? (Cons of the majority verdict)

  • Justice D Y Chandrachud gave the dissenting minority judgment in which he highlighted the following.
  • Surveillance – The architecture of Aadhaar poses a threat of possible surveillance activities via the Aadhaar database. From the verification log, it is possible to identify the places of transactions carried out by a person over the last five years (now made six months). It was also probable to track any person’s location through the database of Aadhaar, even without the verification log.
  • Money Bill – Enacting a Bill as a Money Bill, when it does not eligible for it, violates the delicate balance of bicameralism. It has to be noted that, bicameralism is part of the basic structure of the Constitution. The ruling party in power may not have a majority in the Rajya Sabha. However the legislative role of that legislative body cannot be rejected and enacting it as money bill was “a fraud on the Constitution,”
  • Shortfalls – Rejection of benefits coming from any social security rights is violation of human dignity and not permitted under the constitutional scheme. The biometric authentication failures under Aadhaar that have resulted in denial of rights and legal entitlements were mentioned in this regard.

What is the way forward?

There will be issues with implementation as several businesses are likely to be adversely affected with the decision. Further, regarding access to welfare schemes, it is probable that questions of exclusion and discrimination may be raised again. Now, it is for the government to concentrate on the implementation of this judgement. It must assure that all such extreme demands are halted, or it will be in contempt of court. The government has earlier, with impunity, extended the use of Aadhaar in violation of earlier Supreme Court stays on such actions. Hence the Supreme Court should also follow up on its verdict.

Practice Question:

The Supreme Court took a pragmatic middle path between the Aadhaar scheme excesses and its benefits to the marginalised sections. Critically analyse.

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