'RBI hasn't yet issued instructions to link aadhaar with bank account, order violates law'

By Jag Jivan
While the Government of India (GoI) made linking of aadhaar with bank accounts compulsory this June, ironically, the Reserve Bank of India (RBI), which is supposed to control all financial operations of banks, has not issued any order to this effect. This has come to light even as all banks are on an overdrive to push customers to link aadhaar numbers to bank accounts, lest their accounts would be blocked.
In response to a Right to Information (RTI) application by Yogesh Sapkale of moneylife.in, RBI states, "The Government has issued a Gazette Notification GSR 538(E) dated 1 June 2017 regarding Prevention of Money laundering (Maintenance of Records) Second Amendment Rules, 2017, inter-alia, making furnishing of Aadhaar (for those individuals who are eligible to be enrolled for Aadhaar) and permanent number (PAN) mandatory for opening a bank account."
The reply, however, makes it clear: "It may be noted that Reserve Bank has not yet issued instruction in this regard".
Responding to the specific query in the plea on providing copy of the file along with file notings regarding mandatory linking of aadhaar with bank accounts, the RBI insists, it "has not issued any instruction so far regarding mandatory liking of aadhaar number with bank accounts."
When explicitly asked if RBI had taken permission from the Supreme Court for mandatory linking of bank accounts with aadhaar, especially when the apex court had restricted its usage for six schemes, the RBI says, it is has "not filed any petition before the SC."

Says Sapkale, the RBI’s "emphatic RTI response makes it clear that the decision is entirely that of the GoI", adding, "Experts have questioned the legal validity of this action and even moved the Supreme Court alleging contempt of its orders."
He adds, "Replies from RBI clearly show that it is the Narendra Modi-led National Democratic Alliance (NDA) government, which is frightening and coercing people into linking bank accounts with aadhaar, under the pretext of preventing money laundering. This reasoning is quite bizarre because it seems to treat every bank customer as money launderer and criminal involved in money laundering, unless they link their aadhaar number with bank account."
Sapkale further says, "The Gazette Notification issued by Department of Revenue under the Ministry of Finance, for mandatory linking of bank accounts and Aadhaar number is in contravention of the Aadhaar Act, 2016. Especially, Section 7 of the Aadhaar Act states furnishing of Aadhaar to establish identity for receipt of subsidy, benefit or service for which expenditure is incurred from Consolidated Fund of India."
He adds, "An individual bank customer, in most cases, uses own money to open or operate the account and not from the Consolidated Fund of India. Also there are a large number of taxpayers, who are not even eligible to receive any subsidy or benefits from any Central Ministry or State Government. Yet, they too are forced to link their self-financed bank account with aadhaar number."
Pointing out that "linking a bank account with an Aadhaar number has no advantage either to the bank or the customer", Sapkale notes, "This is because the customer’s PAN number, which has been issued by the Income Tax Department, is already linked to majority bank accounts. The PAN number actually provides much more information than the Aadhaar number and is linked with all financial instruments of the banks’ customers."

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