Life without Aadhaar
I don’t have an Aadhaar number. Three years ago, I went to buy a car in Bengaluru, where I live. The dealership wanted my Aadhaar number. There’s no government subsidy on buying a petrol car, so what did they need Aadhaar for? After some deliberation, they discovered that they could indeed sell me a car without an Aadhaar. My PAN (permanent account number) sufficed, but the transaction proceeded with the caution of a contraband sale.
This year, a rat made its home in the car’s air conditioning ducts, chewing a hole in it. I made an insurance claim. After the car returned from service, the insurance inspector noticed my Aadhaar number wasn’t on the record, and asked for it, saying he needed it for the KYC (Know Your Customer) formality. My documents were already with him, so what did he need Aadhaar for? The troublemaker was a rat, but the government isn’t identifying rats with Aadhaar numbers yet. Aadhaar is only issued to humans and cows. Sure enough, the insurance claim was processed without Aadhaar.
My spouse Zainab and I bought an apartment during the pandemic. We applied for a home loan. The private bank put us on to an agent who wanted everything — Aadhaar and the passwords to the income tax (IT) portal for us as individuals and the GST portal for the company we are directors in. We knew better. A home loan is secured against the property, not the buyers. It shouldn’t need anything more than the buyers’ credit scores, which a bank has access to.
At another bank, I told the manager I had an ongoing court case. He
looked worried and said it might be difficult to issue a home loan,
so I told him I was suing the government for misbehaviour and it wasn’t the other way.
Data vs diversity
I am a self-taught computer programmer and I have applied my skill in various domains, including journalism, academia, e-governance and my startup. I follow tech policy and campaign for digital rights. My work has resulted in defining telecom regulation on net neutrality and the founding of a digital rights organisation. I am a co-petitioner in two cases in the High Court of Karnataka challenging the linking of PAN and Employees’ Provident Fund (EPF) with Aadhaar.
The stated goal of Aadhaar is noble, of giving every individual an identity, but everything about it — the way it was proposed, budgeted, designed and implemented — has been inverted and used as a means to identify an individual for the convenience of the government.
Enrolment in Aadhaar is optional, as repeatedly stated everywhere, and yet
it has been made mandatory in practice, via both illegal coercion and unconstitutional law, much of which is still being litigated in courts.
Aadhaar was meant to unify a patchwork of identity documents, but these have incompatible definitions of such basic concepts as who a “person” is and what a “family” is. For instance, Aadhaar has no concept of death, so death is redefined as no proof of life. When it is linked to pensions, it has the undignified outcome of demanding that the elderly and infirm demonstrate signs of life to an unreliable machine in the presence of helpless officials.
Our federal structure gives states independent jurisdiction in some domains, but the states and the Centre are always disputing the boundaries of their authority. A technological intervention is also an attempt to gain the upper hand. The forced use of Aadhaar is a manifestation of these two tensions. Citizens are caught in the middle.
Savings locked
Holding one’s ground in this situation is not easy. I am heartened by the number of people who share the belief that the government must be held accountable to the people. Their resistance, expressed via civil disobedience, RTI applications, and court challenges, has been instrumental in the slow reform of governance, but it has imposed a significant cost on each of them.
An army veteran and RTI activist told me that the lack of Aadhaar had amounted to his ‘financial death’ and that he was surviving on past savings and the support of family and friends. He said, “My provident fund (PF), stocks and tax refunds are blocked. My income has TDS (tax deducted at source) at twice the normal rate. My employer sacked me because my PAN was not linked to Aadhaar and it affected their compliance with EPFO (Employees’ Provident Fund Organisation) rules.”
So what problem does linking PAN with Aadhaar actually solve?
KYC conundrum
Last month, the bank that issued my home loan blocked my account for re-KYC and my EMI payments failed. They refused to update my address to the place they had financed, and accepted the outdated address on my passport. Their concern was solely to go by a reputable document issued by someone else.
An early pioneer of mobile cash wallets told me KYC was irrelevant to his business model. The customer loaded money into the wallet upfront, so the business did not face any financial risk. The customers’ identity didn’t matter beyond the phone number, with which they were identified and contacted. KYC was collected in whatever format was acceptable to the government because illegal activity became the lookout of the government’s law enforcement agencies.
I noticed this disparity everywhere. Loans, credit cards and postpaid connections require thorough in-person verification as the service provider assumes risk. Futuristic technology like presence-less and contactless KYC is only acceptable for deposits and prepaid services.
Linking distress
When the linking of PAN with Aadhaar became mandatory in 2019, in keeping with a 2017 law, many gave in and got themselves numbered. A friend went to a nondescript enrolment office where the operator called him an ‘anti-national’ for holding out for so long. He had to swallow his pride just to file his tax returns.
Aadhaar number assignment can take months after enrolment. The filing
deadline was fast approaching and the IT portal insisted on an Aadhaar number, in contravention of the new law, which allowed either an Aadhaar number or an enrolment number.
My circle of lawyers and techies have taken a close look at the law and the tax portal. We noticed the portal was collecting an Aadhaar number but not authenticating it against the individual. It accepted any random number, even if not a valid Aadhaar number. That number could even be reused. If this was somehow meant to identify individuals holding
multiple PANs, it did nothing of the sort. The law specified no consequences for invalid numbers, so a few of us took the risk and filed our returns. CBDT (Central Board of Direct Taxes) processed them and issued refunds.
Others didn’t take this risk. IT professional Viswanath L said, “I haven’t been able to file my income tax returns for 2019 and 2020 as the portal won’t let me do it without Aadhaar. My demat, brokerage and mutual fund accounts have been blocked.” The requirement was removed sometime after 2020.
A few of us petitioned the High Court of Karnataka against CBDT in 2019. The judge asked CBDT to respond with an interim stay. We learnt of another order from the Gujarat High Court that stayed linking until the conclusion of a case in the Supreme Court contesting the validity of money bills as acts. The deadline was repeatedly postponed for years. CBDT finally showed up in court in 2023, requesting the judge to close the case as the deadline was likely to be postponed again. It was not, so we petitioned again. A year later, the new judge noted the CBDT had given no response to the facts presented by our lawyer and ordered another stay.
This sort of bad faith coercion has serious ramifications. The market regulator SEBI (Securities and Exchange Board of India) issued blocking orders last year, citing an obsolete CBDT notice on inactive PANs. The market was forced to comply. My monthly SIPs (systematic investment plans) failed. I could no longer invest or redeem them. Fund managers could not do anything to help. I was now locked out of my own savings in the middle of turmoil in the IT industry. SEBI recanted this June after pushback from industry representatives, but at this point I have a new appreciation for the Indian obsession for savings in gold, an asset that the authorities cannot manipulate.
A 40-year-old consultant told me Aadhaar had limited her financial investment choices. Being locked out is a recurring concern, so she has chosen not to open a demat account or invest in the National Pension System (NPS).
Perhaps the most egregious illegal coercion is by the EPFO. Labour law compels employers and employees to set aside a portion of the salaries as a safety net. Large employers manage their own funds, but almost everyone else has to open accounts with EPFO. When EPFO blocks deposits and withdrawals with a demand for Aadhaar, it is a violation of the contract under which the accounts were opened. Acquaintances who visited EPFO’s offices in Bengaluru to seek an explanation have reported the same experience: they meet an official who listens with a sympathetic ear before expressing helplessness. The software doesn’t allow them to proceed. And their superiors had set targets linked to their appraisals.
Another petition was filed in 2021. I was in the company of four people who were close to losing their jobs as their employers got queasy about the EPFO non-compliance. Months passed waiting for a hearing. The lead petitioner caved in to the pressure of unemployment and got numbered. Our lawyer, uncomfortable challenging the government, has since ghosted us. We no longer know the status of the case.
Coercion everywhere
When the government demonstrates such behaviour, it should be no surprise others do the same, with no regard for what the law says. Six homeowners in Indiranagar refused to rent a place to Latha (name changed) because she didn’t have Aadhaar. She visited the UIDAI (Unique Identification Authority of India) office a few times. “They finally issued a weak letter stating Aadhaar is only one of the IDs required,” she recalled.
Abhay Rana, my co-petitioner against CBDT, found himself in a similar situation. Homeowners cited the Model Tenancy Act 2021, which has a sample form that asks for Aadhaar, even though the law is not in force in Karnataka. He had to rent a house in his partner’s name.
In 2016, my daughter’s school threatened to revoke her nursery admission if we didn’t submit her Aadhaar. I was travelling and my wife had to act quickly. She took our daughter to an enrolment centre but was turned away as her own Aadhaar card had an address in Mumbai. Apparently, this made our daughter ineligible to enrol in Bengaluru. A contact at UIDAI was surprised to hear about this and got us an appointment at their office. The officials were helpful, but asked if we were NRIs.
Why does a private school need the Aadhaar number of a child? It is issued to children without biometrics and cannot be authenticated. The government’s logic is that they are compelled by the Right to Education to track students dropping out of school. This was previously achieved with the help of transfer certificates.
Last month, Balasubramanya Bhat, a startup founder, had his daughter tested for dengue at a private hospital. The hospital refused to share the report without her Aadhaar. The child, 11 years old, is a US citizen with a passport and other documents to prove her identity. The hospital relented only after five days, but the child had resumed school assuming she had no dengue. The report turned out positive.
When people get used to the idea that Aadhaar must be submitted on demand all the time, they also become easy targets for fraud. Identity theft is so rife that the perpetrators have been immortalised in OTT shows and movies. We get regular calls from ‘police’ and ‘customs’ about suspicious parcels in our name. Frauds have benefited from the government’s behaviour, because few can reliably distinguish legal from illegal anymore.
People vs Aadhaar
After the Supreme Court constrained the use of Aadhaar in 2018, UIDAI introduced a QR code with a digital signature to confirm that the data had not been tampered with, replacing online verification. The Reserve Bank of India has also updated KYC guidelines to allow use of this QR code. The card was originally just a receipt, invalid without online verification, but now is an officially valid document.
Public interest technologist Anivar Aravind alerted me to new behaviour following these developments. An individual who wants address proof at two different locations gets an Aadhaar card for one address — paying Rs 50 for a plastic card with a hologram — and then updates the details to get another card. The QR codes on both cards remain valid indefinitely, not needing online verification. Since nobody seems to pay close attention to the documents submitted for Aadhaar updates, this can be used to obtain cards for different spellings of one’s name, and different dates of birth. The people of India, after years of being coerced at every turn, have joined the party to reclaim their dignity.
Like this story? Email: dhonsat@deccanherald.co.in
(The author is a digital rights activist whose work has resulted in defining
telecom regulation on net neutrality.)