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The Delhi High Court has directed authorities across the country to make biometric-based Aadhaar authentication mandatory before granting any new registration under the Goods and Services Tax (GST) regime.
The interim order was passed by a Bench of Justices Anil Kshetarpal and Shail Jain while hearing petitions concerning fraudulent GST registrations allegedly obtained using the PAN and Aadhaar details of unsuspecting citizens, Bar and Bench reported.
Court orders biometric verification for all GST registrations
The court said GST registrations should not be granted without biometric Aadhaar authentication, rather than limiting the additional verification to cases identified as risky by the system.
"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, per a Bar and Bench report.
The government, however, has been allowed to inform the court if it encounters any practical difficulty while implementing the direction.
Fraudulent registrations linked to tax evasion
The case includes a petition filed by a woman named Neha, who alleged that two GST registrations had been fraudulently obtained using her PAN and Aadhaar details without her knowledge.
According to her plea, the registrations were used to swindle more than Rs 4.46 crore from her savings account with Punjab National Bank. She approached GST authorities in March 2026, but moved the High Court after alleging that no effective action was taken.
The court had previously raised concerns over the extent of fraudulent GST registrations and given authorities an opportunity to find a solution.
Court flags delay in implementing biometric checks
During the September 8 hearing, the court referred to figures given by the Union Finance Ministry in the Rajya Sabha. As many as 2,800 fraudulent GST registrations were detected in 2023-24, involving about Rs 15,085 crore in tax evasion.
In 2024-25, 1,654 such registrations were detected, with tax evasion estimated at Rs 13,109 crore.
The government had stated that biometric Aadhaar authentication was being introduced to tackle the problem. However, the court noted that the measure had not been implemented across the board.
"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.
Verification can no longer be limited to ‘risky’ cases
GST authorities and the Centre told the court that biometric verification was currently conducted when data analytics and other parameters identified an application as ‘risky’.
The High Court has now directed that biometric authentication be carried out for every GST registration application.
"The authorities are expected to take up the matter with all seriousness," the court warned.
