Introduction

• The Ministry of Electronics and Information Technology recently proposed allowing private entities and state governments to carry out Aadhaar authentication for a number of services, expanding the ambit of the use of the digital identity beyond its ministries and departments.

What is the Background of this Issue?

• In the case, Justice K.S. Puttaswamy (Retd.) and Anr. Vs. Union of India (2017), the constitution bench of the Supreme Court (SC) comprising of the then CJI Dipak Misra and Justices AK Sikri, AM Khanwilkar, DY Chandrachud and Ashok Bhushan by 4:1 verdict, upheld the constitutionality of the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016.
• The dissenting opinion was given by Justice DY Chandrachud.
• The Supreme Court struck down certain sections which allowed the use of Aadhaar authentication and E-KYC (Know Your Customer) by private companies to establish an identity for delivering services.
• In 2020, the Parliament came up with The Aadhaar Authentication for Good Governance (Social Welfare, Innovation, Knowledge) Rules, 2020 in which rule 3 talked about purposes for Aadhar Authentication on a voluntary basis for:
  • Usage of digital platforms to ensure good governance.
  • Prevention of dissipation of social welfare benefits.
  • Enablement of innovation and the spread of knowledge.

What is Aadhaar?

What are the Proposed Amendments for the Expansion of Aadhar?

• The Amendments are proposed under the Aadhaar Authentication for Good Governance (Social Welfare, Innovation, Knowledge) Rules, 2020.
• The Amendment will enable Aadhar identification by private entities and state governments for ease of living of residents of the country and for easy access of services by them.

What are the Concerns in Relation to Expansion of Aadhar?

• The decision to expand identification using Aadhaar may threaten privacy.
• It may have a negative impact on individual liberties, constitutional morality.
• It involves higher chances of fraud by carrying out unauthorized authentication.
• It may increase the rate of cybercrimes in India.

What are the Legal Provisions in Relation to Aadhar?

• The Aadhaar (Targeted Delivery of Financial and other Subsidies, benefits and services) Act was passed by the legislature in 2016.
  • This Act provides for, as a good governance, efficient, transparent, and targeted delivery of subsidies, benefits and services, the expenditure for which is incurred from the Consolidated Fund of India to individuals residing in India through assigning of unique identity numbers to such individuals.
  • The SC in 2018 upheld the validity of this act but struck down Sections 32(2), 47 and 57.
  • Section 32(2) of the Aadhaar Act referred to disclosure of information, including identity information or authentication records, made pursuant to an order of a court not inferior to that of a District Judge.
  • Section 47 of the Aadhaar Act referred to cognizance of offences.
  • Section 57 of the Aadhaar Act referred to the use of Aadhaar data by anybody corporate or person to establish the identity of an individual.
• The government amended the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016 to allow only banking and telecom companies to carry out authentications to fulfil the KYC requirements in the year 2019.
• In the case of K.S. Puttaswamy (Retd.) & Anr. v. Union of India & Ors. (2017), the SC upheld the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016 as constitutional, however, Sections 32(2) and 47 and 57 were struck down as unconstitutional.
  • These sections allowed the use of Aadhaar authentication and E-KYC by private companies to establish an identity for delivering services.
  • The SC further held that privacy is a fundamental right under Article 21 of the Constitution of India, 1950 (COI).
  • The principles declared in the above-said judgement were:
    • Whenever parliament tries to abridge the fundamental rights, it must declare the objective to do so.
    • The State must show that there is no alternate method to achieve that objective.
    • The state must prove that it made the least possible intervention into the rights of individuals.

Conclusion

• If a law is passed without giving due consideration to the principles laid down in the privacy case as described earlier, such law may run a risk of violating the Supreme Court’s judgement. It is therefore imperative upon the legislators to not take hasty decisions so as to put the privacy of individuals at risk.