Daily Editorials for UPSC IAS Exam Preparation

Aadhar Legal Debate- Part 2


There is a huge debate going on in the political environment in India on the Aadhar and apparent concerns with its implementation, especially with opposition parties walking out of the Parliamentary discussions because of the adamant stance of the government making Aadhar mandatory for several schemes despite a Supreme Court judgement that Aadhar is purely voluntary and not mandatory.

In the part 1 of this debate, we discussed about the merits and privacy concerns of the Aadhar, in this part let us look at the other debate which is on the process subversion used to pass the Aadhar Bill under the garb of a money bill.

What is a Money Bill?

  • A Bill usually becomes a law once it has been passed by both Houses – Lok Sabha and Rajya Sabha – and the President assents to it. `Money bills’ are an exception.
  • A bill certified as a ‘money bill’ by the speaker of the Lok Sabha can be enacted into a law by the Lok Sabha alone, without any approval from the Rajya Sabha.
  • Rajya Sabha’s approval is not necessary although it can recommend amendments to a money bill.
  • The Aadhar Act, 2016 was enacted using this route. After being passed by the Lok Sabha, the Lok Sabha speaker certified the Aadhar Bill as a ‘money bill’. Accordingly, amendments suggested by Rajya Sabha were not considered and the bill was enacted into law.

Constitutional Provisions of Money Bill

Article 110(1) of the Constitution identifies a bill as a money bill if it contains “only” provisions dealing with the following matters, or that incidental to them:

  1. imposition and regulation of any tax,
  2. financial obligations undertaken by Indian Government,
  3. payment into or withdrawal from the Consolidated Fund of India (CFI) or Contingent Fund of India,
  4. appropriation of money and expenditure charged on the CFI or receipt’;
  5. Custody, issue or audit of money into CFI or public account of India.

Does Aadhar Act contravene with the provisions of Money Bill?

You can read the original Bill here.

  • A careful analysis of Article 110 and of the Bill reveals that the Bill was tightly drafted in order to try to make it a money bill.
  • The draft clarifies that this subsidy, benefit or service will be withdrawn only from the Consolidated Fund of India (CFI). This brings it within the purview of Article 110(1)(c) [withdrawal of money from CFI] or Article 110(1)(d) [appropriation of money out of the CFI]
  • Under Article 110(1)(g), a money bill could comprise of provisions dealing `only’ with matters incidental to clauses mentioned above. Since most of Aadhar Bill provides for a mechanism to transfer subsidy, benefit or service from the CFI, it can be argued that this is `incidental’ to withdrawal or appropriation of money from the CFI, which justifies a money bill.
  • But, an area where the Bill may have ventured beyond the scope of a money bill is disclosure of information in the interest of national security. It could reasonably be argued that disclosure of information for national security is neither covered specifically, nor is it `incidental’ to the objective of targeted delivery of subsidies, benefits or services from CFI.
  • As the Aadhaar Act was introduced in the Lok Sabha as a money bill even though it does not meet the necessary criteria for such a classification, this treatment of the bill may be considered as an instance of procedural irregularity.

 Can the Speaker’s final authority whether a bill is a money bill or not be subjected to Judicial Review?

  • The Supreme Court has to first decide if it can question the speaker’s “final” decision to certify Aadhar Bill as a ‘money bill’.
  • The Supreme Court has in three earlier decisions refrained from questioning the speaker’s decision.
    • Mangalore Ganesh Beedi Works v. State of Mysore (1962),
    • Saeed Siddiqui v. State of UP (2014)
    • Yogendra Kumar Jaiswal v. State of Bihar (2015).
  • In these cases as per these judgments, the speaker can certify each and every bill to be a ‘money bill’ capable of being enacted by Lok Sabha alone, rendering the Rajya Sabha and the bicameral legislative system redundant. And the Supreme Court cannot question the speaker’s decision since it is “final”.
  • If we are to consider this as a procedural irregularity, the Supreme Court’s power of judicial review comes up against Article 122 – which states that the validity of any proceeding in the parliament can (only) be called into question on the grounds of procedural irregularities.
  • Raja Ram Pal vs Hon’ble Speaker, Lok Sabha and Others (2007), the court evaluated the scope of judicial review and observed that although parliament is supreme, unlike Britain, proceedings which are found to suffer from substantive illegality or unconstitutionality, cannot be held protected from judicial scrutiny by article 122.
  • In another case deciding upon the scope for judicial intervention in respect of exercise of final authority by the speaker, in Kihoto Hollohan vs Zachillhu & Ors. (1992), the Supreme Court held that though the speaker of the house holds a pivotal position in a parliamentary democracy, the decision of the speaker (while adjudicating on disputed disqualification) is subject to judicial review that may look into the correctness of the decision.
  • Although the Indian Constitution grants conclusivity to the speaker’s decision, it does not explicitly bar judicial review.
  • Indian Constitution does not mention that the speaker’s decision “shall be conclusive for all purposes” and “shall not be questioned in any court of law”. So Supreme Court may take the cognisance of the petition filed by Mr Jairam Ramesh

Concluding Remarks

  • As the provisions of the Aadhaar Act have far reaching implications for the fundamental and constitutional rights of Indian citizens, the Supreme Court should look into the matter of its identification and treatment as a money bill and whether such decisions lead to the thwarting of legislative and procedural justice.
  • Aadhaar Act reveals a structural concern regarding this classification process, which may have substantial implications in terms of undermining public and parliamentary deliberative processes.
  • Apart from deciding upon the legality of the nature of the bill, it is vital that the apex court ask the government to categorically respond to the concerns red-flagged by the Standing Committee on Finance,
    • access and misuse of personal information, surveillance,
    • profiling, prohibiting other data bases from storing Aadhar numbers;
    • and securing confidentiality of information which is in the registrars
  • Further, the repeated violation of the Supreme Court’s interim orders – in contexts ranging from midday meal schemes to the IT returns should also be addressed.

[su_box title=”Practice Questions” style=”bubbles” box_color=”#99bb41″ title_color=”#000000″ radius=”20″]


  1. What are the substantial fallouts of the Aadhaar Act?
  2. Can Speaker’s authority on the classification of bills in Lok Sabha be challenged in courts?


OFFER: Only for ForumIAS Portal Users! : Join ForumIAS Simulator Test Series – Starting April 2, Get Rs. 500 OFF when you enroll via this special link: Click here
Daily Editorials for UPSC IAS Exam Preparation

Aadhar- Legal Debate – Part 1




NDA government has been recently made moves make an Aadhaar number mandatory for filing tax returns, midday meals, MNREGA jobs and several other schemes despite Supreme Court judgement that Aadhar can’t be made mandatory.

Let us have a look at different aspects of the debate.

Advantages of the Aadhar Card

  • Govt. can save Rs 50,000 crore per year by using Aadhaar Card for distributing social welfare schemes to the poor by better targeting as most of schemes are marred by leakages. In the form of DBT scheme for LPG, government has saved Rs 10,000 crore in two years.
  • As per Nandan Nilekani, Government of India can now claim to be paper-less, presence-less and cash-less by using Aadhaar Card extensively which can further save about 2000 crore of papers approximately.
  • 600 million hours would be saved by 300 million+ people who seek Govt. services daily
  • Jan Dhan, Aadhaar, Mobile trinity can be the greatest beneficiary for the poor who didn’t have any identity till date, helps in financial inclusion and reduce exclusion errors.
  • Aadhar Card shall also help in ensuring Net Neutrality, as digital identity of all Aadhar Card users would be stored within India.

Disadvantages or Concerns with using Aadhar

  • Advocators of privacy and information protection are arguing that Aadhar Card can be grossly misused by both Govt. agencies and via unauthorized access.
  • Intimate and highly sensitive data like that of Iris Scans and finger prints of a billion Indians are being saved at two locations: Bangalore and Manesar (Haryana), and even if one location is compromised, it can prove to be disastrous for the common man.
  • The biometric data of Indians would give Indian Govt. more intrusive and surveillance power than America’s National Security Agency.
  • Now that all other schemes, PAN and Bank related data are also being integrated with Aadhar, it makes it much more risky than in its original form by putting on every Indian a threat of mass surveillance which is preferred by dictatorial government and not democratically elected ones.

Are there any inbuilt security mechanisms?

Nandan Nilekani, the chief architect of the UIDAI and Aadhar wrote on his blog that there are several inbuilt security mechanism in the whole system of UIDAI platform, which will make such deep rooted surveillance a tough nut to crack.

  • Use Limitation: Any person or entity can only extract that information for which the user has given consent. A provision of fine and imprisonment exists in case any information is extracted without consent.
  • Collection Limitation: Only that information can be extracted, which is fed into the system. Unlike NSA’s artificial intelligent computers, UIDAI cannot extract other vital details about the user or persons associated with the user.
  • As per the said rules, no information provided under UIDAI can be displayed publicly by any entity (Government or 3rd party)

Supreme Court’s Judgement on Aadhar

  • SC in a 2015 judgement said that the Aadhaar card Scheme is purely voluntary and it cannot be made mandatory till the matter is finally decided by the Court one way or the other but this directive has been flouted by the Government time and again.
  • Supreme Court has repeated the same thing even today that it cannot make the Aadhaar card mandatory to extend the benefits of its welfare schemes in an urgent hearing of the plea citing privacy concern.
  • Supreme Court also said today that Govt, however, cannot be stopped from using Aadhar in other schemes like opening of bank accounts and for filing tax returns.

As a move to bypass the earlier Supreme Court order, government brought about a Bill to give Aadhar a legal backing.

The Aadhar Act, 2016

You can read the original Bill here.

  • The Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Bill, 2016 was introduced and passed as a money bill, on the grounds that subsidies and other benefits will be drawn from the Consolidated Fund of India to resolve the contention of the lack of a legislation backing Aadhaar with a provision for more schemes to be attached to Aadhaar in future.
  • It established the Unique Identification Authority of India (UIDAI) as the authority for the functionality of the Aadhaar process, to provide for an Aadhaar number, to every resident who submits his/her identity information (Biometric + Demographic).
  • Biometric information includes photograph, finger print, Iris scan, or such other biological attribute of an individual as may be specified by regulations.
  • The demographic information includes information relating to name, date of birth, address and other relevant information of an individual specified by regulations but significantly excludes information about race, religion, caste, tribe, ethnicity, language, records of entitlement, income or medical history.
  • Aadhaar number shall not confer or be a proof of, citizenship or domicile
  • It also carries a provision which may require Aadhaar holders to update their biometric and geographic information the objective of the provision is to have the continued accuracy of the information in the repository
  • UIDAI has been established as a corporate body, consisting of a Chairperson, a CEO and two part-time members. The CEO of the Authority will not be below the rank of Additional Secretary to the Government and will be appointed by the Central Government.
  • Central Identities Data Repository has been created which will be the centralized database containing all Aadhaar numbers and details. It will also be responsible for authentication and verification of the information provided by Aadhaar holders, at the time of enrolment.

Privacy Provisions in the Act:

  • It imposes a restriction on sharing information and bars the use of core biometric information for any purpose other than for the generation of Aadhaar numbers and authentication.
  • It makes it mandatory for the entity requesting authentication to obtain consent from the person whose information is to be collected for such authentication
  • It provides that disclosure of information, including identity information or authentication records is permissible if made in pursuance of an order of a Court (at least District judge), or in the interest of National Security by an officer of the level of Joint Secretary or above.

Criticism of Aadhar Act

Principles endorsed by 15 global organisations, including the United Nations Development Programme, World Bank group and Asian Development Bank for the ‘maximization of benefits’ for identification systems like Aadhaar, have emphasised the need for establishing strong legal and regulatory frameworks, upholding user rights and establishing mechanisms for independent oversight to ensure their proper use.

A deeper glance shows that several regulations are yet to be prescribed and have been left open-ended.

  • It does not define national security and the term in itself is vague and overbroad.
  • The penalty for unauthorized access to the repository for tampering with data on the repository is too minimal.
  • It does not envisage the creation of an independent regulatory body armed with appropriate powers to ensure that citizens’ rights are protected.
  • There was a recent incident of ‘misuse of biometrics reported in the media, the government neglected it as an ‘isolated case’ of an errant employee of ‘a bank’s Business Correspondent’s company’ misusing the system. There is no way public can seek Redressal in such cases, because by the Act, the cognizance of offence can be taken only when UIDAI files the case in the Court.
  • Aadhaar Bill does not also incorporate a categorical clause on opt-in and opt-out.
  • It lacks provisions on giving notice to a person in case of breach of information, in case of third party use of data, or change in purpose of use of data – which were among provisions recommended by the Justice AP Shah Committee on Privacy in 2012.
  • Authentication factors [biometrics in the case of Aadhaar], commonly known as passwords, should always be revocable. If the password is compromised, you should be able to change the password or at least say that this password is no longer valid.” In its current form, the Aadhaar Act gives users no such rights.

Disputes regarding identification and the use of personal data that are not satisfactorily resolved by the providers should be subject to rapid and low-cost review by independent administrative and judicial authorities with authority to provide suitable redress.

Apart from all these, there is another debate whether the government and speaker have acted in malafide to pass the Aadhar Bill as a Money bill which we shall look at tomorrow. Stay tuned.

[su_box title=”Practice Questions” style=”bubbles” box_color=”#99bb41″ title_color=”#000000″ radius=”20″] Questions

  1. How big a threat Aadhar can be for the concerns of privacy of a citizen? Critically Analyse.
  2. What are the lacunae in the way Aadhar has been implemented?


OFFER: Only for ForumIAS Portal Users! : Join ForumIAS Simulator Test Series – Starting April 2, Get Rs. 500 OFF when you enroll via this special link: Click here