Aadhaar: A Quick Summary Of The Supreme Court Majority Order

Why the Supreme Court upheld Aadhaar.

(Picture: Supreme Court of India website)
(Picture: Supreme Court of India website)

In a landmark decision today the Supreme Court of India upheld the Aadhaar Act, the use of the money bill route for its legislative passage and the use of mandatory Aadhaar-based identification for government welfare schemes, the expenditure for which is drawn from the Consolidated Fund of India. Most mandatory private use of Aadhaar has been struck down.

We may record here that (Aadhaar) enrolment is of voluntary nature. However, it becomes compulsory for those who seeks to receive any subsidy, benefit or service under the welfare scheme of the government expenditure whereof is to be met from the Consolidated Fund of India.

In a 567 page majority judgment, authored by Justice Sikri and concurred upon by two other judges—Chief Justice Dipak Misra and Justice AM Khanwilkar—the Supreme Court answered five questions...

Question 1: Whether the Aadhaar project creates or has tendency to create surveillance state and is, thus, unconstitutional on this ground?

Judgment: The architecture of Aadhaar as well as the provisions of the Aadhaar Act do not tend to create a surveillance state, said the majority order.

According to the order, this is ensured by the manner in which the Aadhaar project operates. Drawing from representations made by the Unique Identification Authority of India and the government, the order stated:

  • During the enrolment process, minimal biometric data in the form of iris and fingerprints is collected.
  • UIDAI does not collect purpose, location or details of transaction. Thus, it is purpose blind.
  • The information collected, as aforesaid, remains in silos. Merging of silos is prohibited.
  • The requesting agency is provided answer only in ‘Yes’ or ‘No’ about the authentication of the person concerned.
  • The authentication process is not exposed to the internet world.
  • There are sufficient authentication security measures taken.
  • There is an oversight by Technology and Architecture Review Board and Security Review Committee.
  • During authentication no information about the nature of transaction etc. is obtained.
  • The authority has mandated use of Registered Devices for all authentication requests.

Hence the three judges have held that “it is very difficult to create profile of a person simply on the basis of biometric and demographic information stored in CIDR”.

But the order does dilute some provisions pertaining to data protection. For instance, it has directed that authentication records are not to be kept beyond a period of six months, whereas the Aadhaar Act permitted five years.

Other dilutions are discussed later in the story.

Question 2: Whether the Aadhaar Act violates the right to privacy and is unconstitutional on this ground?

Judgment: Referring to the earlier Supreme Court decision that determined privacy to be a fundamental right, the order states that any restraint on privacy must meet three tests.

  • backed by law
  • legitimate state aim
  • proportionality

The existence of the Aadhaar Act and delivery of welfare benefits fulfil the the first two requirements.

The order noted that the third test of proportionality has also been met because:

  • the purpose of the act is to ensure deserving beneficiaries of welfare schemes are correctly identified;
  • it also achieves the balancing of two competing fundamental rights: right to privacy on the one hand and right to food, shelter and employment on the other.

But the majority order directs that Section 7 of the Act, which says proof of Aadhaar number is necessary for receipt of certain subsidies, benefits and services, etc., would cover only those benefits for which expenditure is drawn from the Consolidated Fund of India.

On that basis, CBSE, NEET, JEE, UGC, etc. cannot make the requirement of Aadhaar mandatory as they are outside the purview of Section 7 and are not backed by any law. 
Supreme Court Majority Order

Question 3: Whether children can be brought within the sweep of Sections 7 and 8 of the Aadhaar Act?

Judgment: The majority order has permitted the enrollment of children under the Aadhaar Act with the consent of their parents/guardian.

On turning 18, if a child wants to opt out of the Aadhaar, she will be given the option to exit. Currently that provision is absent in the act.

Determining that school admission of children is neither a service nor a subsidy, the order directed that requirement of Aadhaar would not be compulsory for admission.

Since under the Constitution education is a fundamental right for children of the ages 6 to 14 years, enrollment under a scheme such as Sarv Shiksha Abhiyan does not require Aadhaar as it is not a benefit.

But for availing benefits of other welfare schemes Aadhaar can be made mandatory for children, subject to the consent of the parents.

And though the order allows for the limited use Aadhaar, it includes an overwhelming exception.

We also clarify that no child shall be denied benefit of any of these schemes if, for some reasons, she is not able to produce the Aadhaar number and the benefit shall be given by verifying the identity on the basis of any other documents.   
Supreme Court Majority Order

Question 4: Whether several sections of the Act are unconstitutional?

Judgment: The majority order has in many cases read down and in some, even struck down sections that the petitioners argued to be unconstitutional. The most important of which is Section 57 which permits the use of Aadhaar by private companies.

Section 57 permits the use of Aadhaar number for establishing identity for any purpose, by the state or any corporate or person, pursuant to any law or contract.

Judgment: The order stated that “any purpose” is susceptible to misuse and can only be a purpose backed by law. It also found that allowing any corporate or person to use Aadhaar for authentication, especially on the basis of a contract between the corporate and an individual, would enable commercial exploitation of private data and hence is unconstitutional.

But the order is not crystal clear whether all private use of Aadhaar for authentication is unconstitutional or whether this applies only if such private use is based on a contract between a corporate and a person.

This part of the provision which enables body corporate and individuals also to seek authentication, that too on the basis of a contract between the individual and such body corporate or person, would impinge upon the right to privacy of such individuals. This part of the section, thus, is declared unconstitutional. 
Supreme Court Majority Order (emphasis added)

The other sections that have been read or struck down include...

Section 33(1): disclosure of Aadhaar information in certain cases, such as pursuant to a court order.

Judgment: The order said an individual, whose information is sought to be released, must be given the opportunity of a hearing and the right to challenge any such court order.

Section 33(2): restricts confidentiality of Aadhaar data in cases of national security if so determined by senior government officer (joint secretary).

Judgment: Any breach of confidentiality can be done only on the orders of a very senior government officer (higher than joint secretary) along with a sitting high court judge.

Section 47: provides that only UIDAI can file a court complaint in case of violation of the act.

Judgment: The section must be amended to also allow filing of such complaint by an individual/victim whose right is violated.

Section 2(d): pertains to authentication record ie: the record of the time of authentication, identity of the requesting entity and the response provided by UIDAI.

Judgment: The provision in the present form has been struck down but can be reframed keeping parameters laid down in order.

Regulation 27: which provides archiving of data for a period of five years.

Judgment: Struck down. Retention of data beyond the period of six months is impermissible.

Question 5: Whether the Aadhaar Act could be passed as ‘Money Bill’ within the meaning of Article 110 of the Constitution?

Judgment: Since the purpose of the Aadhaar Act is to create unique identification so that citizens can avail government subsidy, benefit or service, the expenditure for which would be from the Consolidated Fund of India, it can be passed as a money bill.

Other Important Points

Aadhaar-PAN Tax Linkage Maintained
The order upholds Section 139AA of the Income Tax Act, 1961 that makes it mandatory to quote Aadhaar when filing tax returns or for allotment of Permanent Account Number.

No Mandatory Use Of Aadhaar To Open A Bank Account
The order found that such mandatory provision of Aadhaar to open a bank account or maintain an existing one does not stand the test of proportionality and “violates the right to privacy of a person which extends to banking details”.

No Mandatory Linking Of Aadhaar With Mobile Number
The order found that since the circular issued by the Department of Telecommunications making such linkage mandatory was not backed by a law, it was illegal and unconstitutional.

It’s important to note that Justices Chandrachud and Bhushan delivered separate opinions in this case. While Justice Bhushan concurred with the majority view, Justice Chandrachud found the Aadhaar act “to be declared as unconstitutional”. He also stated that the Aadhaar Act was not a money bill. “Superseding the authority of Rajya Sabha constitutes as a fraud on the Constitution,” he said.