Delhi High Court Makes Biometric Aadhaar Authentication Mandatory For GST Registrations Nationwide

The Delhi High Court has directed authorities across the country not to allow any GST registration without biometric-based Aadhaar authentication, taking note of the continuing misuse of PAN and Aadhaar details of innocent persons for obtaining fraudulent GST registrations.

The division bench of Justices Anil Kshetarpal and Shail Jain passed the direction on September 8 after taking note of data placed before it showing thousands of fraudulent GST registrations and tax evasion running into thousands of crores.

The Court noted that according to the Union Minister of State for Finance's response in the Rajya Sabha, 2,800 fraudulent GST registrations involving stolen or frozen PAN/Aadhaar details were detected in 2023-24, involving ₹15,085 crore in tax evasion. In 2024-25, another 1,654 fraudulent registrations were detected, involving ₹13,109 crore in tax evasion.

The bench observed that biometric Aadhaar-based authentication had been stated to have been made mandatory for GST registration, but despite the passage of more than a year, the measure appeared not to have been fully implemented.

"It appears that despite the passage of more than one year, the statement given by the minister on the floor of the house has not been fully implemented," the Court observed.

It further noted that the respondents had failed to point out any difficulty in mandating biometric-based Aadhaar authentication for GST registration. Consequently, the Court directed:

"all the authorities across the country not to allow any GST Registration without biometric based AADHAR authentication henceforth."

The authorities are at liberty to place objections before the Court regarding any practical difficulty in implementing the direction.

The Court also directed them to examine suggestions submitted by Senior Advocate Tarun Gulati for preventing fraudulent registrations.

The direction came in two petitions filed alleging GST registrations had been fraudulently obtained by third parties using their PAN and Aadhaar particulars.

The Court had earlier observed that nearly nine years had elapsed, yet the authorities had failed to curb the malpractice, which affected innocent citizens and caused substantial loss to the Government.

It had then requested Senior Advocate Tarun Gulati to assist it by suggesting ways and means to curb the practice.

Gulati placed before the Court various suggestions, including making facial recognition of applicants with the Aadhaar database mandatory during GST registration.

The Court has now listed the matter for further consideration on September 22.

For Petitioner: Advocates Manoj Kumar, Ankit Singh, Vaibhav Bhardwaj and Satya Shruti

For Respondents: Advocates Radhika Arora, CGSC along with Ms. Disha Choudhary, GP for R-1&5. Mr. Ankit Raj, Standing Counsel for PNB and Mr. Digvijay Singh, Advs. for R-6. Mr. Shubham Tyagi, SSC, CBIC with, Ms. Navruti Ojha and Mr. Raman Goyal, Advs.