Aadhaar Linking: Online ITR and Privacy

Aadhaar linking with Online ITRs

The number of financial dealings that you can manage without linking AADHAAR to such media as your PAN for online ITR filings, is steadily decreasing day by day. And while the highest court of the land is yet to take a call on biometric association with every government service provider, it is becoming clear that the Aadhaar linking may be beyond the purview of legal objection.

Aadhaar Linking: Online ITR and Privacy

Here are some explanations for why AADHAAR seeding has been made mandatory for various other types of identity cards issued by the government or similar authority.

  1. PAN: With effect from the 1st of April, 2017, the Income Tax Act, 1961 inserted a new section, 139AA to Chapter XIV – the procedure for assessment of taxpayers, which makes it enforceable by law to permanently associate your AADHAAR number with your PAN number before you can file your ITR online. In fact it is necessary to quote your Aadhaar linking while enrolling for allotment of a PAN card.
    Recently, the CBDT extended the last date to make this linkage to December 31 of the current year. One of the benefits of linking AADHAAR is that ITR acknowledgements will not need to be delivered separately each time you e file your returns online. So the process is likely to be less tedious and less complex.
  2. Bank Accounts: There is no specific directive from the RBI asking banks to mandatorily link your bank account with your AADHAAR. The Reserve Bank’s official norms specify six documents that can be used interchangeably to fulfil identification norms. These include a valid Passport, Driving License, Voter I Card, NREGA Job Card and the AADHAAR. There is, however, a government notification asking banks to seed bank accounts with the customer’s Aadhaar linking. The last date reported for this task is December 31, 2017.You might be receiving messages and phone calls asking you to link your AADHAAR with your bank account. RBI’s KYC norms state that the bank has the option of closing your account if at least one of the KYC documents is not submitted. According to experts, after the August 24 Supreme Court ruling on the right to privacy, the earlier refusal by the same court to put a stay on AADHAAR seeding of account numbers will be visited again when the AADHAAR committee puts forth its observations in November. It is recommended that account holders wait till then before giving out biometric details to purely commercial organizations such as banks and mobile service providers.
  3. Mobile numbers: As stated above, the government hopes to check tax fraud by permanently tagging IDs of all kinds. There are many chilling effects of such blanket mass surveillance measures. An Oxford study attributed to John Penney showed that the feeling of watched all the time breeds an environment of fear and forced conformity and hinders free expression, so essential to innovation and social progress. In the August 24 ruling, Justice Chelameshwar describes privacy as freedom from unsolicited stimuli, the freedom to not be observed intrusively and having and fostering respect for personal choices. The counter-arguments included the interests of national security – a suspiciously encompassing term that might be prone to prejudiced interpretation. However, the court upheld the argument that behavioural profiling cannot be allowed to continue without regulation.
  4. Investments such as Mutual Funds and Provident Funds have also been authorized to maintain Aadhaar linking. The EPFO has noted that its provision for salaried employees amounts to social security and must therefore be provisioned for AADHAAR seeding to protect beneficiaries.
  5. Driving Licenses, Death Certificates, and Other Social Security Schemes: To prevent the misuse of stolen vehicles, faked deaths and unintended beneficiaries eating into shares of the genuinely needy you need to quote your AADHAAR before obtaining such documents from government authorities.

Online ITR and Privacy

Whatever the decision of the Supreme Court appointed Aadhaar linking bench, closer scrutiny over your tax payments, online refund claims and financial transactions is an attitude that’s here to stay. One needs to not only stay clear of misadventures but also of miscalculations. Should you feel that your tax estimations need the guiding hand of an expert, you can always take the help of online tax planning counsellors that help you get the most mileage out of your money.

ITR filings

This article is the intellectual property of AllIndiaITR, one of the leading tax return app developers in the country. AllIndiaITR is a product of Corwhite Solutions Private Limited



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