Part 1 of this series included arguments by the petitioners challenging the linking of Aadhaar to the PAN card, thereby making it mandatory for all taxpayers to get an Aadhaar number. Making Aadhaar mandatory is in violation of Supreme Court orders, which limited the number of welfare services for which Aadhaar can be made mandatory. The government has since passed the Aadhaar Act as a money bill, thereby bypassing a Rajya Sabha.
The PAN amendment is Section 139AA of the Income Tax Act, passed along with the Finance Bill earlier this year. The first petition was filed by CPI Leader Binoy Viswam, who is represented by Senior Advocate Aravind Datar, and the second one was filed by Sudhir Vombatkere and Bezwada Wilson, who are represented by Senior Advocate Shyam Divan. Attorney General Mukul Rohatgi, Harish Salve, and others are representing for Union of India and UIDAI. In addition to this, in the absence of the attorney general, Arghya Sengupta of the Vidhi Centre for Legal Policy, a think tank which lists former Aadhaar head Nandan Nilekani’s wife Rohini Nilekani as a patron, argued on behalf of the government of India. Zoheb Hossein, advocate, and a “non-resident expert” at Vidhi Centre for Legal Policy, argued on behalf of the UIDAI.
Notes from the discussions in the Supreme Court below, based on press releases (this and this) from the Rethink Aadhaar campaign, and interspersed with a slightly edited/paraphrased versions of tweets from lawyers Prasanna S* and Gautam Bhatia*.
May 2nd 2017
The Attorney General, representing the Government of India, claimed there were only two ways to challenge an enactment of Parliament – first whether parliament has the power to make such a law and second whether the law infringes the Constitution. He said the petitioners had no right to argue privacy.
From Prasanna S: Only issue at hand is validity of 139AA of Income Tax Act. A statutory provision may be challenged only on two grounds. The first ground is legislative competence. No possible challenge there (246 read with Entry 82 of List 1 and Entry 97 clear.) Second ground is violation of provisions of constitution such as Fundamental Rights. Income Tax is by its very nature coercive.
Orderly collection and use of taxes necessary for a well functioning society. PAN card has been in vogue since 1975 for the purpose of giving unique identity. Unique Identification has been a motto since 1975 for orderly collection of taxes. For registration of property we have always required all 10 fingerprints. 32A of the Registration Act 1908. It is necessary for an orderly society. This is just a machine for delivery.
He claimed that the object of introducing Aadhaar was to stop black money and terrorism.
The AG argued that giving fingerprints to the Aadhaar database was acceptable as we in any case give our fingerprints for buying property, visas, give our photos for rations and make driving licenses. He said the petitioners cannot claim they don’t have passports or phones.
From Prasanna S:
The Attorney General: “where is the intrusion? People take all kinds of photos. We are moving to digital. This is akin to saying we want to live in a vacuum.
We live in a world where we are frisked before air travel. We take fingerprints even before exercising fundamental right to travel abroad.
Justice Sikri interrupted to clarify that these were voluntary services.
The Attorney General said: “What is privacy. You don’t have a house, you don’t live the way you project. You cannot say you want live in a vacuum. I have transgressed to show that the concept of bodily integrity is bogus.”
From Prasanna S:
The Attorney General said that “So called privacy is what is being argued. We part with all kinds of data when you carry a mobile phone, making transactions using credit card. Argument of “so called privacy” and bodily integrity is bogus. How is iris scanning more intrusive than photograph? If you don’t want to part with anything in return for State protection and services, must go live in himalayas. Is bodily integrity absolute?”
From Gautam Bhatia: The Attorney General: “The right to your body is restricted by the State. This is Rousseau’s Social Contract.” He cited the Termination of Pregnancy Act, pointing out that Abortion is regulated. There are breath checks for drunk driving.
Justice Sikri: These examples might not be apt, because there the restrictions are reasonable
From Prasanna S: The Attorney General “Lack of competence and violation of Fundamental Rights are the only available grounds. There is no third ground. “Arbitrariness” is not a ground. “Proportionality” never a part of article 14. Only recognised in article 19.”
He argued that just/ unjust or harshness not available as grounds of challenge to a taxation provision. Rajbala case being cited. Upheld minimum criteria for contesting panchayat elections. Proportionality never a ground to challenge a statutory provision.
From Gautam Bhatia: AG cites Hanif Qureshi judgment for the presumption of constitutionality. AG cites Hamdard Dawakhana for the proposition that all background circumstances must be taken into account in judging constitutionality. AG cites McDowell and Kohli. AG cites Rajbala vs State of Haryana – restrictions on contesting Panchayat elections. The Court upheld it. Pleas of arbitrariness and proportionality are subjective. Court can’t strike down law on that basis.
AG argued that PAN was a doubtful document made on the basis of localised documents which could be duplicated. (In fact, PAN is a valid document of identity proof to obtain an Aadhaar card.) The PAN card, he said, was suspect because of fraud, tax evasion and black money used for drugs and terror. He said Aadhaar could not be faked and it was the most secure ID.
From Prasanna S:
The Attorney General said that “PAN came about for identification. Increased emphasis on computerised record for high value transactions. There are 29 crore PANs. About 5 cr of these are assessees. So there are 24 crore non assessees who want it just for ID. In that 5 crore, not all (pay) tax. PAN already has details like name fathers name photo etc. PAN needed secondary verification through driving license, ration card etc, which were all never fool proof. Easy to get a replica. PAN verification is just random.”
“Only 0.2% of all cards verified. Such verification threw up multiple duplicate PANs.
People had multiple PANs. Multiple shell companies. Mischief that one could do with layers of companies could be (in the) thousands of crores. We cancelled 10 lakh cards. Programme of PAN slowly became suspect.
The Attorney General: “It’s not only about tax collection. What is in question is black money, laundering of money for terror, drugs etc. So we need a robust identification system. Digitised fingerprints and iris the only currently available method for robust identification.
From Gautam Bhatia:
The Attorney General: In the world, the only way is to digitize iris and fingerprint kept for posterity. There is no other way. There is no duplication in the world of fingerprints and iris. If in the future, people find a way to duplicate, we will have to find another way, but today it’s the only way.
From Prasanna S: Fingerprints and iris are unique. But they are all encrypted and stored in central database of Government of India. Cannot be given to anyone except to court for criminal investigation. Aadhaar is the only robust identification. Today it has revolutionised social benefit schemes. It also helps in eliminating black money, preventing swindling etc, so the state can use the gains to serve honest taxpayers. 13.7 crore aadhaar numbers issued. Aadhaar conceived to prevent leakages in PDS, LPG etc. Such leakages were rampant. It started as executive scheme in 2009.”
He then explained MNREGA, PDS etc., and how it eliminated middle men. He highlighted the doorstep delivery of benefits by banking correspondents, and pointed out that even secondary document for Aadhaar may be suspect, but because of biometric deduplication, no-one can use it again.
From Prasanna S: The Attorney General added that “Aadhaar now has made it extremely easy to open bank accounts. Most pensioners are required to prove they are alive from time to time”
Justice Sikri: there is an old joke about that. If a pensioner does not take pensions for 4 months and goes to collect for the May month. Audit objection raised something like “pensioner alive for May. What about January to April?
From Gautam Bhatia:
Attorney General: Without this, we are all dodging. we have saved 50,000 crores on benefits, pensions, Jan Dhan accounts. This is Rousseau’s social contract. The State is like a corporation. Individuals are members of corporation. Nothing absolute in them. we don’t live in vacuum. We are part of the overall collective. This is important philosophically. I expect the State to give me bridges, roads, security. But I don’t want to pay my tax by the rules? Everyone must have an identity.
The UIDAI CEO also brought in a small biometric reader connected to a mobile phone, to demonstrate, and it appears there were technical glitches with the machine, before it worked, and showed a tab with ekyc details.
From Gautam Bhatia:
Attorney General: instance of a duplicate Aadhaar is almost non-existent. There are no multiple Aadhaars. 113 crores, no duplicates. In Ludhiana, multiple PANs were acquired by one person. Nagpur too. That thing about Hanuman Ji and a dog having Aadhaar – that’s a different issue. The gap in the tax base may be because of duplication of PAN cards and death of PAN card holders.
From Prasanna S:
The Attorney General: One person one pan is necessary. Seeding of aadhaar will provide that. Instance of duplicate aadhaar is almost non existent. Only 1.2 Lakh people show income more than 50 lakhs. Impossible.
Justice Sikri: That may only be the count for lawyers. May be because of tax planning. Not evasion.
Attorney General: one of our cities is now famous for ” entry companies” it has become a business now. There are several judgments if this Court that mandates laudatory use of Aadhaar. Sections 139A and 139AA of the Income Tax Act now go hand in hand.
The AG argued that PAN-Aadhaar linking was being made mandatory to fulfil international obligations under FACTA which obliged the government to share information on foreign citizens in India with their own governments. “If we do not have a robust system how can we give details. We have obligations to the world.”
He also said that aadhaar was necessary and that it had been introduced for the purpose of delivering benefits including the food rations in Public Distribution System and MNREGA, and that the government could nevertheless use Aadhaar for anything it wished to. Further, he claimed that the government had saved Rs. 50,000 crore. (This savings figure has been disputed by the Comptroller and Auditor General’s office as well as several researchers and economists, who claim that the bulk of the savings came from a reduction in international prices.)
From Prasanna S: The Attorney General read the PUCL case where Wadhwa committee recommends leverage of aadhaar as one of the reforms. He also read Lokniti order for SIM card verification (involving SIM cards used for terrorist attacks).
He said that the Social Security Number started as social security but became defacto identification for tax, driving license etc.
From Gautam Bhatia:
Attorney General: no biometric in (US) social security no because their other systems are strong
From Prasanna S:
Attorney General: “Privacy may or may not be part of article 21. But there are enough safeguards in Aadhaar Act.
From Gautam Bhatia:
Attorney General: The UIDAI precludes itself from aggregating info. It is blind to what Aadhaar is used for. The idea is not to share or track information. If you use Aadhaar for SIM and bank, the Telco will not know the latter.
From Prasanna S:
Attorney General: Supreme Court also uses biometric attendance for its employees to do minimal attendance tracking. Aadhaar an enabler of dignity not to derogate dignity. Aadhaar Act needs to be looked at holistically. We are not dealing with a demon. In a social contract, have no right to be invisible.”
Justice Sikri: Social contract theory itself is disputed. Lets not get into it.
One cannot say “I don’t want to do it”. The whole concept is baseless.
Attorney General: “Forcible taking of fingerprints is not self incrimination. This Court said it fifty years ago. We will also go to DNA next. Selvi is different. Narco analysis is invasive. Not fingerprints. We have moved far ahead. We can forcibly take blood DNA etc. We do not know it Justice Karnan will subject himself to medical exam. God knows whether he will take it or not. He has ordered the 7 SC judges to take it.”
From Gautam Bhatia:
Attorney General: in the social contract, I cannot be invisible. the right to be forgotten doesn’t mean a person can be without identity, card, number. You want to be forgotten. But the State doesn’t want to forget you. Individualistic arguments cannot be made. The whole concept is wrong. It is baseless. Fingerprints can be taken forcibly in the context of criminal investigations. Now we have DNA. Because we have to live in a system.
From Prasanna S:
Attorney General: “Aadhaar Act can be used for purposes other than what is contemplated under the Act. See section 57. There is anyway no ban on parliament to expand aadhaar uses anyway. It has plenary power. See Section 7. Section 7 contemplates mandatoriness. Reads security and confidentiality provisions of Aadhaar Act. See Section 29. An absolute bar to share core biometric information in any case.”
In response to the Jharkhand leaks the AG said the central government and the UIDAI were not responsible rather the state government was.
From Gautam Bhatia:
Attorney General: “Section 29 says that no core biometric will ever be shared. There was a newspaper report about some leaks. But they were not leaks from us. That was the Jharkhand office. In any case, their biometrics were not compromised. Only account numbers. But that’s all a red herring. Idea is that biometrics should not be leaked.
Leaks from the central government (e.g., Swachch Bharat Mission) were not mentioned. In another first the Government admitted that Aadhaar is mandatory as provided for by section 7 of the Aadhaar Act, though it has claimed several times in court and parliament over past six years that enrolment is and will be voluntary.
The AG said that the right not to have bodily intrusion is not absolute. In the case of criminal matters, criminals have to surrender their fingerprints. The AG said “I am not saying everyone is accused but we need identification.” In response Justice Sikri said “you cannot raise the spectre of crime to say that we will treat everyone as an accused. The liberty of individuals is to be maintained. We live in a society and we have to live with dignity.” You cannot stretch this theory to that extreme. Isn’t there a balance between dignity and state interests?” Justice Sikri told the AG. These were among several interjections from Justice Sikri.
From Gautam Bhatia:
Attorney General: Why can’t the State put in place preventive measures.
Justice Sikri: But you can’t treat everyone as a suspect.
Attorney General: I’m saying the right not to have bodily intrusion is not absolute. It can be taken away in some cases.
Justice Sikri: What cases, is the question.
Attorney General: Your life can be taken away. It can be extinguished.
Justice Sikri: only with due process.
Attorney General: Yes.
Justice Sikri: there must be a balance with dignity.
Attorney General: At the end of the day, if you can give your fingerprints for registering property, why can’t you give for this?
Attorney General: In this world, nothing is absolute. The prior interim orders of this Court cannot injunct Parliament from passing a law. In any case, these orders were passed only when this was an executive scheme. And only for benefits.
Justice Bhushan: The executive cannot bind the Parliament.
Attorney General: Yes. A validating law can remove the basis of a judgment. suppose the interim order is vacated tomorrow. Then what? They should have “the guts” to say that this Court injuncted Parliament.
The Attorney General read out judgments on when Parliament can pass a law to take away the basis of a judgment. AG cites Roe vs Wade for the proposition that one does not have an absolute right to your body. You can’t sell your organs.
Attorney General: You can’t commit suicide. Can you say that I have a right to abuse my body and die at 50, so I will pick up weed from the road and smoke it? You cannot.
Attorney General cites an American SC case about urine testing in schools for athletes. AG cites an American case of DNA testing a rape accused. AG cites a World Bank report on effectiveness of biometrics.
Attorney General: “This is happening across the world. A large no of people in this country don’t have identity. People need identification. Can you shut your eyes to that? These people say: we want to be identified. The same ID as the richest man in the country. People want identification. You go to a railway station. How will you travel? This is the luxury of the rich – to be forgotten.
May 3rd 2017
At the latest hearing on Aadhaar in the Supreme Court today, Arghya Sengupta of Vidhi Centre for Legal Policy who was arguing on behalf of the Government started with two broad arguments for the Union of India and UIDAI: (1) That proportionality could not be read into Article 14, and (2) The idea of informational self-determination was equivalent to privacy and privacy was referred to a larger bench.
He countered the proportionality arguments by citing judgments from the UK.
From Gautam Bhatia and Prasanna S:
Argya Sengupta, Vidhi Centre for Legal Policy (representing government): “Proportionality is not part of Article 14. Proportionality is akin to substituting Court’s wisdom in place of a legislature (citing the KT Plantation CB case). Law in UK is clear. Traditional judicial review claims don’t include proportionality. But Human Rights claims before ECHR are different. Proportionality has caused greater confusion in UK public law.”
He cited Lord Hoffman on equality before law. “The reasons for not treating people equally often involve considerations of social policy.”
To this, Justice Sekri responded saying: “equality under common law may be different from equality under Article 14.”
Argya Sengupta: The question is: what counts as a reason to treat people differently. This is different from proportionality, which is about balancing. There’s no balancing involved under Article 14. Consequently, proportionality is inapplicable to Article 14. Public law is about wrongs, not about rights.Public law is about wrongs rather than rights. Article 14 is also about wrongs. My written submissions have two further cases on how the UK doesn’t follow proportionality. Also, an article by Prof Rebecca Williams from Oxford arguing that proportionality is now the same as the traditional test. We should stick to our test. On merits, Mr Datar argued disproportionality and no rational nexus. Penalty imposed by legislature cannot be struck down on proportionality. In the last couple of days we have all lost sight of 139AA which is the impugned provision. No new penalty in this provision. Only appliws existing penalty to new conditions. Datar’s argument that a statute may be struck down for disproportionate punishment is incorrect (cites McDowell case). No enactment can be struck down only on the ground that it is arbitrary or unreasonable.
Justice Sikri: There may be circumstances where that ground may be available. ( Citing Mardia Chemicals)
Sengupta cited Rajbala (case) again, saying arbitrariness no ground to strike down a law.
Arghya Sengupta: Datar argument that there is no rational nexus of classification and the object is incorrect. No enactment can solve a social problem 100%. In this case the first target is individuals. Companies etc may be tackled later on.
Sengupta handed over a sealed envelope to the Court, with apparently confidential information on ongoing investigations. Court refused to look at it.
Justice Sikri: We understand no discrimination between individuals and companies now if anyway Aadhaar is not applicable for companies.
Justice Bhushan said that it may happen tomorrow with an amendment to Companies Act.
Justice Sikri: why discriminate between two people who are willing to pay tax. One who wants to enrol for Aadhaar and one who does not.
Arghya Sengupta: Object of the Act is not discrimination but deduplication of PAN. So the test of discriminatory object for article 14 does not apply in this case. Cites US precedent where TIN was replaced by Social Security Number. Similarly we may also replace PAN with UID in future. Mr. Divan argument that conscientious objectors are discriminated against. He is basically wanting sanction to offend against law. You may not want to stand up for national anthem. Does not mean you sit down.
Justice Sikri: clarifies saying that is not their argument. They have after all come to court to invalidate the law.
Arghya Sengupta: There could be all sorts of conscientious objections to different kind of laws. Cannot declare a law to be discriminatory merely on that.
He then read literature on civil disobedience and conscientious objection, saying “This is an ordinary violation of law. There is no absolute right to informatiomal self-determination. The State may ask for info in a number of circumstances. Births, deaths, marriages. As I myself found out for personal reasons, the husband must compulsorily register. The information that the State asks for is extensive. Nobody challenges it. With fundamental rights, there are no absolutes. My second point – to the extent that such a right exists, it must be on the basis of cultural factors in India. Cannot import conceptions of privacy into India.”
Sengupta cited an article by Mark Tushnet, “professor at Harvard”, on the dangers of comparative law.
Shyam Divan: My submission is not on privacy. It’s about my body.
Justice Sikri: There may be overlaps.
Shyam Divan: Yes, but it’s not subsumed.
Arghya Sengupta submitted that the Supreme Court cannot go into the question of distinguishing informational self-determination from privacy, because that question is with the Constitution Bench.
He then cited Mark Tushnet on difficulties of comparative law, and (US Judge) Scalia’s caution (in a death penalty case) on comparative law in trying to say sentencing practice of other countries not relevant in US, purportedly to justify death penalty.
Arghya Sengupta: We are not a society of angels. We have a real problem. People not paying taxes. Making fake PANs. No information self determination. Therefore India and Germany etc culturally different.This is a country where if you get on a train, within five minutes people tell their life histories. But more specifically, we have duplicate PANs.
He said that a statute could not be struck down for disproportionate penalty because penalty could be decided by the wisdom of Parliament.
Sengupta said that the object of this amendment is to fight corruption but no legislative order can completely solve the problem 100%. Sengupta said the object of the amendment is not to discriminate between those who have Aadhaar and those who don’t but rather to weed out fake PAN cards.
He then argued that informational self-determination is not absolute even in Germany, where there is informational self determination (mentioned by petitioners ;lawyers Divan in earlier hearings) and it could not be read into Indian law and that it could only be understood to be a party of privacy.
From Gautam Bhatia:
Arghya Sengupta from Vidhi Centre for Legal Policy (representing the government): The right to informational self-determination is not unrestricted. Negotitation of individual and community interests necessary as per even the German case. Informational Self Determination is anyway a facet of privacy rights. Control over personal information is common to both Informational Self Determination and privacy.
Arghya Sengupta then Rajagopal, Govind to say right to be let alone is a facet of privacy.
Justice Sikri then observed that the right to be left alone is a question of a person’s own life. The question lay in whether in a tax regime you could exercise your right and say that you would pay taxes in the manner you chose to. Sengupta responded by quoting Oliver Wendell Holmes, “Taxes are the price we pay for civilised society”, he said. Sengupta admitted that there were technical difficulties and errors in the UID system, but maintained that biometrics is the best technology in existence at present.
From Prasanna S and Gautam Bhatia:
Justice Sikri: pointing to Petitioners, you need to address how you can have a right that you say you want to pay tax in a manner you desire
Arghya Sengupta, from the Vidhi Centre for Legal Policy (representing the government): Compelling state interest to uniquely identify tax assessees anyway outweigh interests like right to be let alone. UID is the most popular ID possessed by most. Now most sophisticated biometric system. Even the german hacker that (Shyam) Divan pointed out, says biometric is the most secure authentication technology.
Arghya Sengupta: Interim orders cannot injunct parliament. All the arguments about Parliament being against SC etc make no sense. There may be some errors here and there with dog hanuman etc…no tech is 100% fool proof. Can’t be basis of constitutional challenge. Aadhaar UIDAI notified as critical information infrastructure under IT Act therefore most secure. PAN is technology of 1975. Aadhaar is technology of 2016.
Arghya Sengupta: Leaks etc happening are not of UIDAI’s.
Justice Sikri: today also we have news item.
Arghya Sengupta: All leaks from other govt departments as they have trouble balancing transparency and data protection concerns.
Zoheb Hossein appearing for the UIDAI said there is a distinction between protected and unprotected speech and that distinction will always be maintained. Every action is not speech. Enrolment for Aadhaar does not amount to exercising the right to free speech. He argued that the object of the amendment was to fight black money, increase tax collection and therefore reduce inequality. The object could not be said to be discriminatory because it was in furtherance of equality.
From Gautam Bhatia:
Zoheb Hossein: We are in a progressive tax regime. In our constitution, progressive taxation itself is a facet of equality under Article 14. Object of Act is deduplication. Inclusion of aadhaar eliminates inequality between tax payers and tax evaders. Therefore this Act bolsters article 14. Does not militate against it. There is no inherent discrimination against individuals. There are some taxes like dividend distribution tax applicable only to companies. For instance some exemptions like 80C available only to individuals.
Zoheb Hossein then read from PMLA rules to say that companies don’t go scot free, their natural benefical owners will be under scrutiny.
Zoheb Hossein: 0.44% of duplicates is among the 0.2% PAN cards taken up for verification randomly.
He then said that not every conduct is speech, and quoted the Supreme Court of the US judgment to say destruction of a regis certificate is not speech. “Every conduct is therefore not speech. Need not be protected by 19(1)(a). No injunction unless manifestly unconstitutional.
Zoheb Hossein then argued against the court injuncting legislative action, citing Bhavesh G Parish judgment to say the standard is “manifestly unjust” or ” glaringly unconstitutional”. Therefore no interim relief maintainable.
Sources: 120, 121, 122, 123, 124, 125, 126, 127, 128, 129, 130, 131, 132, 133, 134, 135, 136, 137, 138, 139, 140, 141, 142, 143, 144, 145, 146, 147, 148, 149, 150, 151, 152, 153, 154, 155, 156, 157, 158, 159, 160, 161, 162, 163, 164, 165, 166, 167, 168, 169, 170, 171, 172, 173, 174, 175, 176, 177, 178, 179, 180, 181, 182, 183, 184, 185, 186, 187, 188, 189, 190, 191, 192, 193, 194, 195, 196, 197, 198, 199, 200, 201, 202, 203.
Note from the editor: we’ll cover the counters from the petitioners, which took place on the same day and the next, separately.
Disclosures: Prasanna S is with Rethink Aadhaar, and Gautam Bhatia was involved in assisting Arvind Data for this matter. Disclosure here.