Delhi High Court Issues Nationwide Directive: Biometric Aadhaar Authentication Mandatory for GST Registration
Background and Genesis of the Case
The Delhi High Court, while adjudicating a batch of connected writ petitions, confronted a deeply troubling pattern of identity fraud wherein fraudulent GST registrations were being obtained by misusing the PAN and Aadhaar credentials of unsuspecting, innocent individuals. The lead matter before the Court was W.P.(C) 12210/2026 filed by Neha vs. Union of India & Ors., with the connected matter being W.P.(C) 6218/2026 (Vikram Kaushal vs. Director General of Income Tax (Investigation) & Ors.).
The Court's order dated 08.09.2026 traces the evolution of judicial concern that began with its earlier order dated 21.08.2026, where it had first taken note of allegations that a third party had obtained fraudulent GST registration by misappropriating the petitioner's PAN and Aadhaar details. The Court recognized the gravity of the situation — that if such allegations were borne out, innocent citizens stood exposed to enormous tax liabilities arising from registrations they had no knowledge of or participation in.
Court's Initial Observations and Request for Assistance
In its order dated 21.08.2026, the Court noted that this was not an isolated incident but appeared to be the second such case being brought before it, suggesting a systemic and widespread problem. Recognizing the complexity and policy dimensions of the issue, the Court requested Mr. Tarun Gulati, learned Senior Counsel, who ordinarily represents assessees before the Court, to assist as amicus and submit a note proposing concrete measures to counter such fraudulent practices.
The Court also directed notice to the Commissioner of Delhi Police and listed the matter for 01.09.2026.
Suggestions Placed Before the Court
In compliance with the Court's directions, Mr. Tarun Gulati placed on record a detailed note containing practical and technology-driven recommendations. These suggestions, as reproduced in the Court's order dated 01.09.2026, included the following:
Suggested Ways and Means
i. Mandatory Facial Recognition
During the GST registration process, facial recognition of the applicant matched against the Aadhaar database should be made compulsory for all registrations — not merely those flagged as high-risk.
ii. Video-Based Identity Verification
A video verification mechanism should be introduced, requiring the applicant to upload a 20–30 second video showing their face alongside the original PAN card and Aadhaar card, holding each document for a minimum of 5 seconds. Additionally, the applicant should be required to read aloud a system-generated prompt containing their name or other relevant details along with a unique code generated by the common portal — similar to the process followed for DSC registration by e-Mudhra.
iii. Preservation of IP Address and Device-Location Data
The IP address and device location used at the time of filing the GST registration application should be recorded and preserved by the GST common portal as well as the jurisdictional authority sanctioning the application, so that such data remains readily available for reference if any dispute subsequently arises as to the identity of the person who filed the application.