Summary of this article
Delhi HC orders biometric Aadhaar checks for every GST registration.
Fake GST registrations involved Rs 28,194 crore tax evasion.
Misused PAN and Aadhaar details can create tax liabilities.
The Delhi High Court has directed authorities across the country not to approve any Goods and Services Tax (GST) registration without biometric-based Aadhaar authentication.
The order came after two individuals, Neha and Kaushal, approached the court after their PAN and Aadhaar details were allegedly used to obtain GST registrations without their knowledge. Transactions linked to those registrations then created GST tax liabilities in their names.
Delhi HC Orders Biometric Check For All GST Registrations
At present, biometric Aadhaar verification is carried out when the GST system identifies an application as risky based on different parameters. The court has observed that fraudulent registrations using stolen or misused identity details have still been detected.
The interim direction means biometric Aadhaar authentication will be required for GST registrations instead of being limited to applications flagged as risky.
The bench has also asked the authorities to examine other measures suggested before the court. The case is listed for further consideration on September 22, 2026.
Rs 28,194 Crore Tax Evasion Detected In Two Years
Government data placed before the court showed that authorities detected 2,800 fraudulent GST registrations in 2023-24. These cases involved Rs 15,085 crore in tax evasion.
In 2024-25, another 1,654 fraudulent GST registrations were detected, involving Rs 13,109 crore in tax evasion. This takes the two-year total to 4,454 fraudulent registrations involving Rs 28,194 crore in detected tax evasion.
The financial impact goes beyond lost tax revenue. When a GST registration is created using another person’s PAN or Aadhaar, that person can face tax liabilities and may have to approach authorities to prove that they had no connection with the business.
Court Considers More Measures To Prevent Fake Registrations
Senior counsel Tarun Gulati had suggested additional safeguards, including facial verification, short video checks using the applicant’s original PAN and Aadhaar cards, and alerts to PAN holders when their details are used for GST registration.
Other suggestions include recording the device and internet connection used during registration, checking business addresses and creating additional risk checks when a PAN or Aadhaar number is used for GST registration for the first time.
For taxpayers, these measures could provide additional alerts when their identity details are used for GST registration. The court has asked authorities to examine the suggestions while addressing fraudulent registrations, tax losses and the problems faced by people whose details are misused.
