TIMESOFINDIA.COM | Updated: Apr 5, 2018, 14:26 IST
HIGHLIGHTS
- SC said Aadhaar is not a solution to effectively discourage bank scams, as there is no doubt about the identity of fraudsters
- "It is the bank officials who are hand in glove with the fraudster. Aadhaar can do little to stop it," said the bench headed by CJI Dipak Misra
NEW DELHI: The Supreme Court today disagreed with the Centre's claim that Aadhaar is the panacea for all ills in the system, including bank frauds.
A five-judge constitution bench headed by Chief Justice Dipak Misra, which is examining the validity of Aadhaar scheme, said the biometric database is not a solution to effectively discourage bank scams, as there is no doubt about the identity of the fraudsters.
"The bank knows whom it is giving loan to and it is the bank officials who are hand in glove with the fraudster. Aadhaar can do little to stop it," said the bench.
The SC's observations are significant as it raps the government, which is already taking heat for the recent spate of multi-crore financial frauds plaguing the banking sector.
To name a few: diamond magnate Nirav Modi and Mehul Chowksi swindled Punjab National Bank to the tune of Rs 11,300 crore before fleeing the country; Rotomac owner Vikram Kothari "wilfully" defaulted on loans amounting to Rs 3,695 crore; jewellery exporter Dwarka Das Seth International defrauded Oriental Bank of Commerce of Rs 389.85 crore.
Previously, the Centre told the SC that in a digital era, Aadhaar is the best way to prevent "money laundering and deliver subsidies and benefits".