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Aadhaar gets more teeth

The Aadhaar debate is into its final stages. While the Supreme Court is yet to make it mandatory, the government is flexing its muscles by linking various services to it and forcing citizens to fall in line.
The government’s latest salvo comes in the recently-passed Finance Bill -- Unique Identification Authority of India (UIDAI)-backed Aadhaar cards will now be mandatory for filing income tax returns.
And if a person does not link his Permanent Account Number or PAN card with Aadhaar, his PAN will be rendered invalid after July 1, 2017. Following this, the Department of Telecom has also made it mandatory to link mobile numbers to Aadhaar. It issued a note saying that all telecom operators will have to ensure that their subscribers link mobile numbers to Aadhaar within a year.
If you do not have an Aadhaar number, you will have to submit the enrolment number of your application for Aadhaar. “In case of failure to intimate the Aadhaar number, the PAN allotted to the person shall be deemed invalid and the other provisions of the Income Tax Act shall apply, as if the person has not applied for allotment of PAN," says Amarpal Chadha, tax partner, people advisory services, EY India.
Interim problems: This measure is expected to create a slew of problems for people. Many individuals may still not have an Aadhaar card. They should apply for one. Everyone needs to check if their Aadhaar and PAN details match. If there are discrepancies between the two, get either your Aadhaar or PAN details updated so that you do not face problems at the time of filing returns. Details on how to update the Aadhaar and PAN are available on the web sites of UIDAI and the IT department respectively (see box).
Service providers are insisting on it: Until now the need for an Aadhaar card arose if someone wanted to avail of the LPG subsidy, or if senior citizens wanted to enjoy a concession on train tickets. This 12-digit number, which is a proof of identity, is largely used by the government to distribute cash benefits and other subsidies under its welfare schemes. Since submitting the Aadhaar card at the time of opening a bank account, investing in a mutual fund, etc was optional (you can submit another proof of identity), many people have still don’t have one. That ambivalent attitude will now have to change. 
There are already instances where the authorities are insisting on it. Those applying for domicile proof and those who want to get their property registered are being asked to provide this number. 

Some telecom providers also insist on it before giving a connection. Schools are asking for it from students. You need it to appear for competitive exams like IIT JEE. Online providers of financial products insist on Aadhaar since it makes KYC easier. With the government moving strongly towards making Aadhaar compulsory, one can't escape complying with this regulation.  

Whether you invest in stocks, shares, or do any other high-value transaction, over a period of time the tax department will be able to see all this information at the click of a button. Experts also agree that this step will create an audit trail for various transactions. “Linking of Aadhaar and PAN will throw up any discrepancies in reported transactions and provide a ready database to the revenue authorities for necessary action," says Vikas Vasal, partner, Grant Thornton India. 

But it is still risky: There are several risks associated with Aadhaar, whose basic purpose is authentication and authorisation. The first problem arises from the fact that it is easily accessible to miscreants. Aadhaar numbers of thousands of people have been uploaded on the Internet. “Since the Aadhaar number has to be given at so many places, it can be misused to pull information about people from the centralised database. In the case of credit and debit cards, we are told not to share these numbers publicly. That is not the case with Aadhaar. UIDAI’s position is that you should treat your Aadhaar number carefully. But the fact is that the Aadhaar number is not used carefully either by consumers or businesses. It is a fairly public number. Too much power is being vested in a number that is quite public,’’ says Udbhav Tiwari, policy officer, Centre for Internet and Society, Bengaluru.
Second, Aadhaar has a centralised database, and all centralised databases are vulnerable to hacking. Third, biometrics are not a very secure form of authentication. “Fingerprints are easy to forge. 

The UIDAI says that the device (used to check the fingerprint) should not remember the biometrics but should only transfer it to 

UIDAI which will verify the information. But miscreants could use a device that captures your biometrics," says Tiwari.

Other documents used for identification like PAN and passport are not easy to duplicate because of their security features. PAN, for instance, has a hologram. The power of the passport lies not in the passport number but in the document. Without the passport one cannot travel internationally. But in case of Aadhaar one can go on the Internet and print a new Aadhaar card. “If somebody has 

managed to capture my fingerprint and has my Aadhaar number, he can use it wherever Aadhaar is required,’’ says Tiwari.
Business Standard New Delhi,27th March 2017


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