The government's policy  was challenged over data security and privacy concerns.
Aadhaar, which means foundation, started out as a voluntary programme to help tackle benefit fraud.
However, it has become increasingly critical for any financial transactions and for access to welfare schemes.
States have been using Aadhaar to transfer government pensions, scholarships, wages for a landmark rural jobs-for-work scheme and benefits for cooking fuel to targeted recipients, and distribute cheap food to the poor.
The government argues that Aadhaar has cut waste, removed fakes, curbed corruption and made substantial savings.
But questions have been raised about the moral authority of the government to force citizens to share biometric data. Activists say it is in breach of the UN's Fundamental Right of Privacy.

Mr Morsi said he was not "calling for war", but that he would not allow Egypt's water supply to be endangered.
Egypt was apparently caught by surprise when Ethiopia started diverting the Blue Nile last month, amid works to construct a hydroelectric dam.
The river is a tributary of the Nile, on which Egypt is heavily dependent.
The Great Ethiopian Renaissance Dam is a $4.7bn (Â£3.1bn) project that Ethiopia says will eventually provide 6,000 megawatts of power.
It says the Blue Nile will be slightly diverted but will then be able to follow its natural course.
"Egypt's water security cannot be violated at all," Mr Morsi said on Monday. "As president of the state, I confirm to you that all options are open."
"If Egypt is the Nile's gift, then the Nile is a gift to Egypt,'' he said, quoting popular sayings about the river in an emotive televised speech.
"The lives of the Egyptians are connected around it... as one great people. If it diminishes by one drop then our blood is the alternative."
Analysts say Mr Morsi could be using the issue to distract attention from severe domestic political and economic challenges.
Egypt is particularly dependant on water supply from the Nile, and its growing population has been placing that supply under increasing strain.
Sudan is also reliant on Nile waters.
Egypt cites a colonial era ruling to claim a right to the majority of the Nile's waters for itself and Sudan, but Ethiopia says the ruling is outdated.
Mr Morsi said Egypt had no objection to development projects on Nile basin states, "but on condition that those projects do not affect or damage Egypt's legal and historical rights".
Last week, Egyptian politicians were inadvertently heard on live TV proposing military action over the dam.

Romelu Lukaku has joined Manchester United for £75m, Arsenal have snapped up France forward Alexandre Lacazette for a club-record £46.5m, while Everton have already topped the £100m mark for money spent.
But how much are those stars on the move really worth? And what fees will others linked with big-money transfers command?
The CIES Football Observatory has calculated the value of the world's top players using variables such as performance, international status, contract, age and position.
Test your transfer acumen with our quiz and find out who is worth what this transfer window according to CIES.
No cheating - you can check out the entire CIES Football Observatory list here.
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India's Supreme Court has rejected an attempt to stop the government making a controversial biometric identity card mandatory for social welfare schemes.
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Egyptian President Mohammed Morsi has said "all options are open" to deal with any threat to his country's water supply posed by an Ethiopian dam.
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We're less than a fortnight into the summer transfer window, but Europe's top clubs are already flexing their financial muscle.