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Made Aadhaar mandatory to prevent fund diversion to shell companies: Centre

21 April 2017

The apex court asked the Centre as to whether the move would address the problem of generation of fake PAN and ration cards.

Responding to the Supreme Court's concern over centralized biometric-based database of India's 1.2 billion citizens, Attorney General Mukul Rohatgi said that the central government's aim was to end the black money menace by making Aadhaar a mandatory.

The Supreme Court had, on 27 March, specified that the Aadhaar card should not be made mandatory for availing governmental schemes. The government was told that the Aadhaar can only be an optional requirement, as per the court's earlier ruling on the issue. Justice A K Sikri, who was heading the bench, said.

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The top court said it will decide on whether Aadhaar card can be made mandatory, for filing of Income Tax (I-T) returns, next week.

In a separate ruling last month, the Supreme Court had also said the government can not require citizens to have an Aadhaar card to benefit from government welfare schemes.

The AG said that fake PAN cards were being used to divert finds to shell companies to justify the Centre's move to make Aadhaar cards compulsory for PAN cards. "To prevent it, the only option is to make Aadhaar card mandatory", Rohatgi told ANI.

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Section 139AA of the Income Tax Act by the Finance Act, 2017, makes Aadhaar mandatory for filing Income Tax Returns.

However, in an order dated August 11, 2015, had said that Aadhaar can not be made compulsory for government schemes.

But among those things, the SC did not include getting PAN cards or getting welfare benefits.

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Made Aadhaar mandatory to prevent fund diversion to shell companies: Centre