Delhi High Court makes biometric Aadhaar authentication mandatory for GST registrations across India

The Delhi High Court has directed the authorities to make biometric-based Aadhaar authentication mandatory before any person or entity is given a registration under the Goods and Services Tax (GST) regime [Neha v. Union of India & Ors].

A Bench of Justices Anil Kshetarpal and Shail Jain passed the interim order on petitions raising concerns about fraudulent GST registrations that are taken using stolen or frozen PAN card and Aadhaar details of unassuming citizens, to swindle money.

"For the time being, directions are issued to all the authorities across the country not to allow any GST Registration without biometric based AADHAR authentication henceforth," the Court's September 8 order said.

The Court added that the government is at liberty to apprise it of any practical difficulty it may encounter in implementing this measure.

The petitions on which the order was passed included one by a woman named Neha. Her plea stated that two GST registrations were fraudulently obtained using her PAN and Aadhaar, without her knowledge or consent, to swindle over ₹4.46 crore from her savings bank account with Punjab National Bank. Upon inquiry, the Bank disclosed that it had received a purported GST notice for the said amount in favour of a GST authority.

Neha lodged complaints in March 2026 before the concerned GST authorities. After the authorities failed to take any action, she moved the High Court seeking directions for an effective investigation.

During an earlier hearing of the matter, the Court had expressed concerns about the rampant nature of fraudulent GST registrations, adding that GST regime appears to have created more problems than it solved.

It proceeded to grant the authorities a last opportunity to find an effective solution to the problem.

In the ensuing hearing on September 8, the Court recalled that a Minister of State in the Union Finance Ministry, while answering a question in the Rajya Sabha, had disclosed that as many as 2,800 fraudulent GST registrations were detected in 2023-24. These registrations were obtained using stolen or frozen PAN or Aadhaar details and had led to about ₹15,085 crores worth of tax evasion.

In 2024-2025, the number of such fraudulent GST registrations stood at 1,654, leading to tax evasion of ₹13,109 crores. It was also stated that biometric-based Aadhaar authentication was being made mandatory for GST registration to tackle such fraudulent activities.

However, the Court found that this measure is yet to be implemented in full force.

"It appears that despite passage of more than one year, the statement given by the minister on the floor of the house has not been fully implemented, resulting in continuous fake GST Registration obtained using stolen or frozen PAN/ AADHAR details," the Court observed.

This situation has resulted in the loss of revenue to the government and the harassment of innocents, the Court added.

The GST authorities and the Central government, meanwhile, told the Court that biometric-based Aadhaar verification for GST registration is carried out only if the system identifies the case as a ‘risky’ one, based on certain parameters and data analytics.

The Court has now stepped in to order that such enhanced verification measures be carried out in every case when GST registration is sought, not just those flagged as being 'risky' by the system.

"The authorities are expected to take up the matter with all seriousness," the Court further warned.

Advocates Manoj Kumar, Ankit Singh, Vaibhav Bhardwaj, Chanderpal, Nikhil Pramod, Animesh Gaur and Satya Shruti appeared for the petitioner, Neha.

The counsel who represented the respondent-authorities included advocates Sumit K Batra, Priyanka Jindal, Radhika Arora, Disha Choudhary, Ankit Raj, Saurabh Mishra, Digvijay Singh, Radhika Bishwajit Dubey, Gurleen Kaur Waraich, Kritarth Upadhyay, Vivek Sharma, Amulya Dev Mishra, Saksham Sharma, Shubham Tyagi, Navruti Ojha, Gaurav Gupta, Shivendra Singh, Yojit Pareek, Surya Jindal and Pradeep Bhatia.

Senior Advocate Tarun Gulati appeared as an amicus curiae to assist the Court.

[Read Order]