Justice K.S. Puttaswamy (Retd . ) v .UOI (2018) 97 taxmann.com 585 (SC) Editorial : Affirmed in Rehhar Foundation v. Justice K.S. Puttaswamy ( 2021 ) 278 Taxman 1/ 123 taxmann.com 344 (SC)

S. 139AA : Return of income – Quoting of Aadhar number – Inclusion of Aadhaar in Income-tax Act valid – Section 139AA of the Income-tax Act, 1961, pass the test of proportionality (right to privacy v. legitimate State interest) – Not unconstitutional [ Art , 14 , 16 ]

The Aadhaar Act serves legitimate State interest and good governance to ensure fruits of welfare schemes (that involve 3% of GDP and, thus, huge of public money) reach to unprivileged and marginalized section of the society by preventing leakages, pilferages and corruption in the implementation of welfare schemes; it does not violate right to privacy, nor is it unconstitutional.

 The Aadhaar Act meets the concept of Limited Government, Good Governance and Constitutional Trust.

 The Aadhaar Act is validly passed as a ‘Money Bill’ (within the meaning of Article 110 of the Constitution).

 

 For admission of children in schools, requirement of Aadhaar would not be compulsory. Benefits to children under different student welfare schemes shall not require Aadhaar; identity may be proved on the basis of any other documents.

 Rule 9 of the Prevention of Money Laundering (Maintenance of Records) Rules, 2005 and the notifications issued thereunder which mandates linking of Aadhaar with bank accounts is fail test of proportionality; hence, unconstitutional.

Circular dated March 23, 2017 mandating linking of mobile number with Aadhaar is not backed by any law, hence, unconstitutional.

 

Certain provisions of the Aadhaar Act and Regulations suffer from the vice of unconstitutionality and, hence, amendments were suggested.