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All Posts | Jan 19,2018

Updates on Aadhaar Final Hearing: Day 2

The hearing on Day 2 began with Senior Advocate Shyam Divan resuming his arguments for the petitioners. He clarified on the deterministic and probabilistic systems of identification. He stated that the devices used for capturing the fingerprints at the time of authentication were of lower quality. On this note, Chandrachud J. pointed out that the fingerprints might even be absolutely unreadable for people involved in manual labour or with age.

Mr. Divan stated that there were 3 aspects which needed consideration: integrity of the process, integrity of the information being collected, and pervasive invasion of fundamental rights. He highlighted the issue relating to privacy, personal autonomy and compelled speech.

He then read out the contents of the initial version of the enrolment form and pointed out the following issues:

  1. There was nothing in the form which suggested that the enrolment was voluntary.

  2. There was no mention of biometrics being collected on the form.

  3. There was no declaration or verification.

  4. No indication on the form as to how the information had been gathered or filled.

  5. No signature of the enroller or enrollee.

  6. No manner of counselling- which raised questions on the nature of informed consent.

He stated that the programme by design is a general purpose scheme, and hence it was now being mandated for everything.

Answering a query of Chandrachud J. on whether there was an ‘opt-out’ on consent to share data, Mr. Divan referred to an affidavit which stated that the the software was so programmed that a person could not opt out.

He argued as to how could the state compel an individual to part with her personal information to a private entity. He reiterated that the whole scheme was by design defective.

At this point, Chandrachud J. asked whether it would make any difference if the enrolling agency is an agency of the state. Mr. Divan responded that there was no question of delegating a core sovereign function to private persons. He pointed out the absurdity of the State compelling citizens to hand over all personal sensitive information to private entities. He stated that everything about the process- from beginning to end was unconstitutional.

Reading out the pre-statute version of the enrolment form, Mr Divan said that no counselling was being done even at that stage. Further, he stated that, UIDAI had no contractual or any other relationship with enrolment entities that collected information.

Chandrachud J. questioned how was it different from people sharing their personal information with private entities for insurance, credit card purposes, etc. Mr. Divan replied that this case would be different as the issue here was that the individual was being asked to part with her information to a private entity she did not know and had no contractual relation with.

Mr. Divan then referred to the ‘KYR+’ (Know Your Resident Plus) form of the State of Kerela. He stated that the form contained additional information like marital status, and that information in silos was being aggregated, which can then be used for tracking and profiling people.

He then listed out several private enrollers. Questioning the integrity of the system, he referred to a Rajya Sabha statement which stated that around 34,000 operators had been cancelled and blacklisted since December 2016. Moreover, he mentioned that as per a media report, around 49,000 enrollers had been blacklisted in 2017.

Mr. Divan then focused on a memorandum of understanding (MoU) dated 28th June, 2010 between the Govt. Of NCT and UIDAI for implementation of Aadhaar programme. He stated that this MoU was the first time that the reference was made to the collection of biometric data for identification.

At this point, Chandrachud J. questioned whether registrars could only be government agencies. Mr. Divan answered that registrars could be government agencies as well as private bodies. He then referred to Article 299 of the Constitution and stated that there was absolutely no legal framework to support UIDAI. He said that MoU did not qualify as contracts as per Article 299.

He pointed towards the palpable lack of integrity in the project which left the people in a vulnerable position.

On being pointed out by Khanwilkar J. that all the above actions had been diluted by the Aadhaar Act 2016, Mr. Divan said that the statute cannot retrospectively validate the violation of fundamental rights.

The arguments then shifted to the Supreme Court judgment on Fundamental Right to Privacy in the case of K S Puttaswamy v. Union of India.

He read out the parts of the judgment of Chandrachud J. explaining the scope of ‘right to personal liberty’. He mentioned how this judgment made the fundamental rights preamble-centric.

He further read out the paragraphs of the judgment on right to informational self-determination and informational privacy. Moreover, he drew the attention of the Bench towards the observation in the judgment where it has been emphasised that privacy is not a privilege of the elite.

Finally, he pointed out to the paragraphs which stressed on the importance of judicial review in order to protect individual rights.

The hearing will continue on Tuesday, 23rd January, 2018.

All Posts | Jan 18,2018

Updates on Aadhaar Final Hearing: Day 1

The hearing on Day 1 began with the Attorney General requesting the court to allocate time to both sides for arguments. Shyam Divan, Senior Advocate and counsel for petitioners, responded by saying that considering the complexity of the issue, he would be able to provide an estimate only by the next week.

Mr. Divan, then, handed out his opening statement and commenced his arguments. He said that the petitions challenged the Aadhaar scheme and the project, the 2016 statute, notifications, regulations, circulars, etc. He stated that the Aadhaar project, which was under challenge, needed to be understood. He said that project was in existence for a period of seven years from 28th January 2009 to 12th July 2016, followed by an enactment which sought to ratify and give a statutory backing to the entire project. However, the primary issue that arose was whether the project was constitutional at all. The second issue was that the statute itself was under challenge on several grounds including violation of Part III of the Constitution. He said that the Aadhaar project was continuing in nature and covered only some parts of the project.

He mentioned that the present case was unique as it involved challenges to an unprecedented programme, i.e., Aadhaar. He stated that the few foreign cases that come close to Aadhaar programme were all decided in favour of the citizens. He contended that if the Aadhaar Act was allowed to operate unimpeded, it would hollow out the the Constitution, especially the rights and liberties assured by it to the citizens.

Mr. Divan proceeded to enlist some of the key issues arising in matter and the reliefs sought. With respect to the physical autonomy of a person over her own body, he said that the concept of eminent domain does not extend to body. He further asked for an ‘option’ to be provided to the individuals enrolled with Aadhaar to ‘opt out’ of the programme and have their data deleted.

He further listed out the important dates leading to the hearing, including the important orders of the Supreme Court issued in the case so far. He stated that from January 2009 to December 2016 till the enactment of the statute, the Aadhaar programme functioned under an administrative notification which had no mention of biometrics at all.

He referred to the orders of the Apex Court passed on 11th August, 2015 and 15th October, 2015 which specifically stated that Aadhaar could not be used for any purpose other than the six schemes mentioned in the orders and that no one would be denied benefits for want of Aadhaar till the matter is finally decided by the court. He emphasised that these orders have neither been diluted nor varied at any subsequent stage.

He highlighted that since then Aadhaar has been made mandatory for several schemes and services including the re-verification of cellphones, opening and maintaining bank accounts, eKYC, holding investments in mutual funds and insurance policies, effectively making it compulsory. He stated that the scheme was meant to be voluntary. However, by mandating Aadhaar for all purposes, it also becomes a case of false declaration.

He then moved on to highlight how Aadhaar was operating as an instrument of exclusion. He detailed the profiles of the petitioners who have been working in the field. He stated that people have been facing several difficulties due to the problems in enrolment. The people living in remote areas of the country were unable to come to the enrolment centres. Moreover, he said, the people involved in manual labour were unable to get their biometrics registered. He further said that biometrics are unreliable in case of elderly people as it keeps changing. He stated that Aadhaar was a programme to stigmatize and exclude people.

Focusing on the duplication issue, Mr. Divan stated that during the beginning of the programme, only a small number of people, to the tune of 1000 or so, were estimated to be excluded due to duplication rejects at the time of authentication. However, as on 17th January, biometrics rejection amounted to 6.23 crores which was more than the population of several states.

He then proceeded to explain different systems for verification of identity- deterministic system and probabilistic system. Elaborating on the former, he said that, the system was deterministic as it relied upon exact matches, like CVV number or an OTP, to be sure of identity. Aadhaar, however, is not based on this system and makes use of probabilistic system.

Describing the probabilistic system, he said that UIDAI captured the fingerprints, photograph and iris and stored them. However, they do not compare fingerprints to fingerprints but make use of a template instead. This template scales the fingerprint and picks up a number of distinctive points or minutae. The authority then sets a value as to how many such of those points should match. Thus, he stated that UIDAI makes a value judgment since if it sets the value too high, there would be no match, and similarly, it cannot set the value too low. He argued that if an individual is entitled to certain rights and benefits, then the process to get them cannot be made dependent on probabilities but should be deterministic.

Mr. Divan delved into the organisational structure of UIDAI and highlighted that the enrolment agencies were all private entities who sent the captured data to the UIDAI. He pointed out that this entire system operated for seven years without any legal framework. He then went into the composition of UIDAI.

At this point, the Bench intervened saying that it did not appear to be a labour intensive organisation to which Mr. Divan replied that there was almost no government oversight over the data gathered.

He further submitted that there should be some statutory parameters and minimum governance when sensitive data such as biometrics are taken. Questioning the validity of the charter under which Aadhaar was operating, Mr. Divan stated that the biometrics were not even covered under the it. He argued that in such a scenario, collection of biometrics was illegal and hence the whole programme is bad.

The focus of the arguments then shifted on to Aadhaar being a tool for surveillance in real time. He explained the process of authentication and how every authentication transaction leave an electronic trail which enables location when built up over time. He stated that there were different silos of information and Aadhaar allowed for convergence of these information which might help in profiling. He questioned whether such an architecture should be permissible.

The Bench asked Mr. Divan if his apprehensions would be met if the State used the data for the purpose it was collected. Mr. Divan answered that Aadhaar by its design was bad and enabled State domination.

The Bench also questioned about the countervailing State interests, of benefits reaching reaching only the deserving and real people. To this Mr. Divan said that the sources clearly point out that have been no such savings as has been claimed. He countered if Aadhaar was a proportionate measure to plug leakages.

Mr. Divan then drew the attention of the Court to the Standing Committee’s report on the old bill and the concerns expressed by the Committee on several issues including privacy, security, data theft, surveillance and profiling. He pointed out the part wherein the Committee had observed that the United Kingdom revoked its national biometric database due to several faults. He further discussed several problems which were in the old bill, and which continue to persist in the current Act.

The Bench also discussed the issue of money bill and the NIDAI Bill, 2010. Senior Advocates P. Chidambaram and Arvind Datar clarified the position in that regard.

Post this exchange, the hearing concluded for the day. Hearing will resume on 18th January, 2018.

All Posts | May 04,2017

Supreme Court hears the Aadhaar-PAN case; updates from Day 6

Arguments in the Supreme Court litigations around linking Aadhaar with PAN, challenging the constitutionality of Section 139AA of the Income Tax Act, were concluded today by Senior advocate Mr. Arvind Datar (also see our updates from day 1day 2day 3day 4, and day 5 of this litigation).

Replying to the State’s arguments, Mr. Datar advanced the following contentions today:

  • Legislative competence: All the previous Supreme court orders including the one passed by a Constitutional bench on 15th October, 2015 pronounce that Aadhaar is voluntary. As long as that order stands, the legislative power of the Parliament under Article 246 remains eclipsed. The question before the court is: if a judgment is given qua executive power, can the Parliament exercise legislative power without removing the basis of the earlier orders? Mr. Datar pointed out that Article 73 of the Constitution says that executive power is coextensive with legislative power and if there is a restraint on executive power, there will be a restraint on the former as well. If the Supreme court has passed an order, it is as binding on the Parliament as it is on any other organ of the State. Therefore, the Parliament had no legislative competence to enact Section 139AA, linking Aadhaar to PAN. The only situations in which Section 139AA can be deemed valid are: 1) Aadhaar is made mandatory under Section 3, and 2) Inserting a non obstante clause under Section 139AA (notwithstanding anything in any other law)
  • Article 14 and Article 19(1)(g): The distinction made under the Aadhaar Act between individuals and companies has no rational nexus with the object sought to be achieved by the Act. Further, proportionality has been a facet of Article 14 since 1959 [Chintaman Rao v. State of Madhya Pradesh; (1950) SCR 759]. Mr. Datar highlighted that proportionality is a part of Article 19(1)(g) as well. A number of small entrepreneurs will be at risk if their PAN is invalidated. This is not a proportional restriction under Article 19(6).

Mr. Datar finished his arguments by appealing to the court to strike down Section 139AA of the Income Tax Act or at least read it down to make the Aadhaar-PAN linkage voluntary.

Senior Counsel Mr. Salman Khurshid also made a brief submission, countering the State’s argument that individuals do not have an absolute right over their body. He explained the meaning of human dignity and the importance of freedom of choice. He said that the measure of a nation is not just its economic growth, but the protection of dignity of every individual.

The State and the petitioners have finished their arguments and the matter is now reserved for judgment.

All Posts | May 03,2017

Supreme Court hears the Aadhaar-PAN case; updates from Day 5

The ongoing challenge in the Supreme Court regarding the linking of Aadhaar for filing of income tax returns, and making it mandatory for PAN, has reached Day 5 when the Union of India continued its arguments. We have been updating details from court proceedings from day 123, and 4 as well.

Day 5 of the hearing began with Dr. Arghya Sengupta laying the following points before the Bench:

  • The doctrine of proportionality is not a facet of Article 14 of the Constitution. It can only be invoked in cases where there is a balancing of rights and restrictions, and Article 14 does not envisage any such balance. Citing the case of K.T. Plantation vs. State of Karnataka, Dr. Sengupta said that the plea of proportionality is subjective by nature and therefore cannot be used to strike down a statute. He further mentioned that proportionality under Article 14 applies only to executive action and not legislative action. A long list of English cases were cited in this regard and to support the argument that in the UK, the doctrine of proportionality is not applied even today. He concluded by saying that the traditional principles of equality followed by Indian judiciary are strong and there is no need to import new principles to this case.

  • There is no absolute right to self determination under Article 21 in India. The state can ask for information from its citizens. Even if we had the right to informational self determination, it cannot be absolute. Further, the conception of privacy prevailing in different parts of the world cannot be incorporated in India. The social and cultural situation has to be assessed before giving meaning to this concept.

  • The safety and security of biometrics as a tool for identification has been studied and analyzed and it has been proven that it is the most fool proof method. He stated that the Aadhaar Act provides privacy protection under Chapter 6 of the Act and under Section 70 of the Information Technology Act, 2000. It was also pointed out that the UIDAI database has never been compromised.

Mr. Zoheb Hossain, Advocate-on-Record, continued the State’s argument. He made the following points:

  • A progressive taxation regime is itself a facet of equality under Article 14. Inclusion of Aadhaar strengthens Article 14 as it eliminates inequality between honest tax payers and individuals avoiding tax and holding multiple bogus PAN cards.

  • Every conduct is not free speech. In the present case, it is speech combined with action and therefore it cannot have protection under Article 19(1)(a). He cited United States vs. David Paul O’Brien to substantiate his argument.

After the state concluded its arguments, Senior Counsel, Mr. Shyam Divan replied from the petitioners’ side. His arguments are as follows:

  • The state has reconciled the voluntary nature of the Aadhaar Act and the mandatory nature of Section 139AA of Income Tax Act to infer that Aadhaar is mandatory. Section 3(1) of the Aadhaar Act uses the word “entitled” and not “obliged”. Section 3(2) says that the enrolling agency shall “inform” enrolling individuals, the manner in which their information shall be used, the nature of recipients with whom the information might be shared, the existence of a right to access information. Section 7 says alternate means of identification is to be provided if Aadhaar is not assigned. Section 8(2)(a) requires consent of an individual before collection of information. Aadhaar enrolment form also states that its free and voluntary. The Aadhaar Authentication Regulation number 6 states that consent of Aadhaar holder is required for authentication. The proviso to Section 57 states that the section is subject to the procedure and obligation under Section 8. The aforementioned sections establish the voluntary nature of Aadhaar as provided in the Act itself. Further, the absence of any sanctions in the Act for non compliance reinforces this fact. Mr. Divan pointed out that the UIDAI website itself claims that Aadhaar is voluntary.

  • Replying to the Attorney General’s argument that Aadhaar act cannot be struck down for lack of legislative competence, Mr. Divan pointed out that there are implied limitations to legislative competence. One of the implied limitations is that the state cannot coerce people to part with their biometric data. We are long past slavery and servitude. He further mentioned that the trajectory of the state’s arguments will create a chilling effect. He emphasized the enormous threat to civil liberties in the present case and prayed to the court to pass interim orders, in case the matter is referred to a larger bench.

Senior Counsel, Mr. Arvind P. Datar continued arguing for the petitioners’ made the following point before the court rose for the day:

  • The Aadhaar Act fails on the aspect of legislative competence. The Supreme Court has passed various orders saying Aadhaar is voluntary and nobody can be forced to enrol under it. The state has repeatedly defied these orders. On the assumption that there’s no Supreme Court order, even then Aadhaar Act and Income Tax Act have to be harmoniously construed, which means that Section 139AA of the IT Act has to be read down.

The hearing in the present matter will be concluded tomorrow with Mr. Datar finishing his final arguments.

All Posts | Apr 27,2017

Supreme Court hears the Aadhaar-PAN case; updates from Day 1

The cases for linking Aadhaar to PAN and making it mandatory for Income Tax returns were heard before a bench of Justices A.K. Sikri and Alok Bhushan in the Supreme Court on 26th April, 2017. Senior Counsels Arvind Datar, and Shyam Divan were representing the petitioners in these cases, Binoy Viswam v. Union of India (W.P.(C)247/2017), S.G. Vombatkere & Anr. v. Union of India (W.P.(C) 277/2017) respectively, whilst the Union of India was represented by the Attorney General, Mukul Rohatgi.

At the outset it was clarified that in this hearing, the challenges to privacy, or the constitutionality of the Aadhaar Act would not be raised, and the arguments by the petitioners would be limited to the parliamentary action of introducing Section 139AA to the Income Tax Act, 1961.

Senior Counsel, Arvind Datar set the stage by pointing out that insertion of Section 139AA was not part of original finance bill, and was introduced on the last day when 30-40 statutes were amended. Section 139AA makes Aadhaar mandatory for filing income tax returns from 1st July, 2017, is required to be quoted when applying for PAN, and in case of failure in linking Aadhaar, the PAN will be deemed invalid.

Mr. Datar argued that Section 139AA should be struck down on the following grounds:

  1. It is ultra vires Article 14 of the Constitution:

  • Aadhaar is only eligible for residents, but under IT Act, there are 12 different types of categories, like HUFs, companies, and others that are eligible for PAN, and is not therefore limited to individuals. Under the classic Article 14 test of reasonable classification, the categories created should have an intelligible differentia, and the classification done, should have a rational nexus to the objective sought to be achieved. Mr. Datar argued that the classification between natural, and non natural persons has no intelligible differentia as proviso for Section 139AA makes the PAN invalid for individuals who do not have Aadhaar, but the income tax act, and Section 139A does not make any such distinction for either filing of income tax returns or for issuance of PAN. Also, the rational nexus between the objective for linking Aadhaar, curbing black money, or avoiding fake PAN cards would not be achieved by solely making individuals as a part of this process, and not other assessees.

  • Moreover, under Section 114B of the Income Tax Rules, having a PAN is mandatory for continuing various activities, like buying property, applying for a credit card, among other things. It was argued by Mr. Datar that by treating ‘individuals’ differently than other categories, they are put at a disadvantageous position; hence, violating their fundamental right under Article 14.

  • Furthermore, Mr. Datar argued that under the test of arbitrariness of Article 14, there have been previous judgments of the Supreme Court where a legislative action has been struck down on grounds of arbitrariness. He cited the case of Malpe Vishwananth Acharya v. State of Maharashtra ((1998) 2 SCC 1) in this regard.

  • Towards the end, Mr. Datar asked for the introduction of a facet of proportionality in Article 14, and put forth a doctrine of ‘rational connection’ devised by Chief Justice of Israel. This doctrine attempted to ensure that along with having a rational nexus to the object sought to be achieved, the element of proportionality of the measure, in the classification process should also be taken into account.

  1. It was over-ruling the orders previously issued by the Supreme Court:

  • On multiple occasions and in various cases, the Apex Court has maintained that Aadhaar cannot be made mandatory, and will be voluntary. Section 139AA, that makes it mandatory to have Aadhaar for applying for PAN as well as filing IT returns over-rules these SC orders. The legislature would have to remove the basis of such orders by amending Section 3 of Aadhaar Act and make it mandatory for every resident to have an Aadhaar. Without making such a change in the parent act, it cannot make it mandatory under the Income Tax Act.

  • Mr. Datar corroborated this with a judgement from the Supreme Court that held that direction of the court become the basis of a mandamus, and cannot be taken away in an indirect fashion (Madan Mohan Pathak v. Union of India (1978 AIR 803). He stated, “my right to not get an Aadhaar cannot be taken away in this indirect fashion.” He also pointed to a judgment, that held that cannot over-rule Supreme Court judgement, but remove basis ((1970) 1 SCC 509).

Post lunch, Mr. Shyam Divan, representing the second petition, S.G.Vombatkere v. Union of India commenced his arguments. He initially laid the context of his petition by giving an introduction of the petitioners as being ‘conscientious objectors’ of the program and in their opinion, it is illegitimate. Explaining their position, he pointed that ‘their bodies are theirs, and the State under this Constitution, has no dominion over the body.’ He elaborated further by stating that under Articles 14, 19, and 21, however far one may read legislative competence, the autonomy of an individual’s body cannot be taken away.

He emphasized on how an individual’s fingerprints and iris scans are their own, and due to the vast variety of rights granted under the Constitution to Indian citizens, the State cannot insist that for efficiency or expediency, the rights and bodies of individuals can be taken away. If an individual is willing to pay taxes, and be identified, they cannot be forced to part with their fingerprints. When asked about the photograph as a biometric feature, Mr. Divan responded that in a complex society such as ours, a photograph has become a legitimate source of identity.

He further dissected the Aadhaar project by pointing out that every database is susceptible to hacks, and biometrics cannot be changed, but can be easily duplicated, even from hi resolution photographs as has been proved by an incident where the German Defence Minister’s fingerprints were taken by a hacker from just a photograph. Mr. Divan, while explaining how the process of authentication can be tracked by the State, called the Aadhaar project an “electronic leash”, and laid down three major issues of surveillance, profiling, and seeding.

He continued his argument by further stating that the collection of such biometrics is undertaken by private parties, and no government official is present when such enrollment takes place. Also, per the UIDAI website, 34,000 enrollment centres have been suspended and 3.84 lakh Aahdaar cards have been canceled. While reading out the enrollment form for Aadhaar, he pointed to the first line that states that the scheme is ‘free and voluntary’ and argued that voluntary usually involves no element of coercion or mandatory nature.

Mr. Divan categorically stated that this was for mere background information on the project, and he is not raising any of these points in the petition at hand, as the matter of privacy and validity of the Aadhaar Act are pending before a larger Bench.

He continued his arguments on 27th April, 2017.