Aadhaar Is Not Mandatory For PAN And Tax Returns Even In July 2017

Many people have asked us whether quoting of Aadhaar is mandatory or not for tax returns or PAN purposes. Recently Supreme Court gave a very complicated judgment in this regard where one thing was dependent upon another.

For instance, the constitutional validity of Section 139AA (1) has been partially approved subject to final decision of the Constitution Bench of Supreme Court. Further, constitutional validity of Section 139AA (1) has also not been tested on the more stringent touchstone of Article 21 and other Fundamental Rights. Even the limited constitutional validity of Section 139AA (1) is subject to the final decision of the Constitution Bench.

Section 139AA (2) has also been severely read down by Supreme Court making the entire Section 139AA toothless. No penal action, including cancellation of PAN card, can take place now till the matter is finally decided by the Constitution Bench of Supreme Court.

So for all practical purposes, Supreme Court of India has made Aadhaar optional for Section 139AA. As a result no return would be rejected or any PAN would be cancelled for not quoting Aadhaar.

Even in July Aadhaar would be optional keeping in mind the settled legal and constitutional position in this regard.

Please see the true interpretation and impact of recent Supreme Court’s judgment on Section 139AA here.

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