SC Upholds Law Linking Aadhaar To PAN, Exempts Those Without It

Those who don’t have an Aadhaar card are also exempted from mandatory linkage and their PANs won’t be invalidated.

The Supreme Court ruled on Friday that Aadhaar will not be mandatory to file income tax returns for those who do not possess an Aadhaar identification number currently. (Photo: iStock)

The Supreme Court on Friday upheld the validity of the law making Aadhaar mandatory for allotment of PAN and filing of Income Tax(IT) returns but exempted those without it for now until the larger privacy issue is decided.

In effect, those who possess an Aadhaar card must link it to their Permanent Account Number(PAN) card and those who have enrolled and not yet got their Aadhaar card are also exempted from mandatory linkage and the penalising invalidation of their PANs if they don't link it.

The apex court while upholding the validity of a fresh provision in the Income Tax (IT) law making Aadhaar compulsory for allotment of PAN and filing of IT returns imposed a partial stay on it till its constitution bench decides the right to privacy issue connected with it.

Section 139AA of the Income Tax Act provides for mandatory quoting of Aadhaar or enrolment ID of Aadhaar application form for filing of income tax returns and making application for allotment of PAN with effect from July 1 this year.

The two petitions challenging Section 139AA were heard by a Bench of Justices AK Sikri and Ashok Bhushan. The lead petition was filed by CPI leader Binoy Viswam. Senior Advocates Arvind Datar and Salman Khurshid appeared for Viswam.

(With inputs from PTI)

Video editor: Purnendu Pritam