Summary
| Category | Data |
|---|---|
| Court | Supreme Court of India |
| Case Number | C.A. No.-012487-012487 – 2025 |
| Diary Number | 45613/2025 |
| Judge Name | HON’BLE MR. JUSTICE SANJAY KUMAR |
| Bench |
|
| Precedent Value | Binding Authority |
| Overrules / Affirms |
|
| Type of Law | Constitutional & Administrative (Public Procurement) |
| Questions of Law | Whether a tender condition requiring cumulative past supply experience solely with State-government agencies violates Articles 14 and 19(1)(g) by creating an unreasonable barrier to equally placed bidders. |
| Ratio Decidendi | The State may fix technical and financial pre-qualification criteria, but they must have a rational nexus to the procurement objective and not arbitrarily exclude competent bidders. A condition limiting eligibility to those with past contracts only within the same State is an artificial barrier that contradicts the doctrine of a “level playing field” under Article 19(1)(g) and violates the equality guarantee of Article 14. Procurement conditions must secure broader competition and best value without geographic fetters where no special security or performance exigency exists. |
| Judgments Relied Upon |
|
| Logic / Jurisprudence / Authorities Relied Upon | Fairness and equality in State largesse; doctrine of “level playing field” under Article 19(1)(g); rational nexus test for tender conditions; anti-cartelisation; non-interference principle unless criteria are arbitrary, discriminatory or mala fide. |
| Facts as Summarised by the Court | The State of Chhattisgarh issued three tenders for supplying sports kits to government schools. A past-performance condition demanded Rs 6 crore cumulative supply experience with Chhattisgarh agencies over three years. The High Court deleted some conditions but upheld this clause. The appellant challenged its reasonableness. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts and procurement authorities |
| Persuasive For | Other High Courts; State Governments; Central Procurement Agencies |
| Overrules | Chhattisgarh High Court’s orders of 11.08.2025 and 12.08.2025 upholding the impugned tender condition |
| Distinguishes | Association of Registration Plates v. Union of India & Ors. |
| Follows | Ramana Dayaram Shetty v. IAAI; UOI v. Bharat Forge; Educomp Datamatics; Global Energy |
What’s New / What Lawyers Should Note
- The Court held that past-performance criteria cannot be confined to contracts within the same State when procuring non-security goods.
- Geographic or security rationales do not justify exclusion of outside suppliers for items like sports kits.
- Procurement authorities must ensure eligibility criteria have a rational nexus to performance, not merely to favour local players.
- Lawyers can cite this judgment to challenge State-specific barriers in tender qualifications.
- Reinforces that Articles 14 and 19(1)(g) guarantee a level playing field in public procurement.
Summary of Legal Reasoning
- The Court restated the settled position from Ramana Shetty that State largesse must be administered fairly, without arbitrariness or discrimination.
- It affirmed that Article 19(1)(g) and the doctrine of “level playing field” preclude artificial barriers skewing competition.
- The impugned clause had no rational nexus to ensuring quality or timely delivery of sports kits; it merely favoured those with past State contracts.
- Geographic or Naxal-affected area justifications were inapposite for non-sensitive goods and insufficient to sustain a State-only performance condition.
- The State could require financial and technical credentials, but they must relate broadly to capacity rather than past local dealings.
- The condition was held arbitrary, unreasonable, violative of Articles 14 and 19(1)(g), and therefore struck down.
Arguments by the Parties
Petitioner (Vinishma Technologies Pvt. Ltd.)
- The High Court misapplied Association of Registration Plates to uphold an inapplicable local-performance test.
- The Rs 6 crore local-supply requirement violates Articles 14 and 19(1)(g) by excluding competent out-of-State suppliers.
- The condition fosters cartelisation and narrows participation without justification.
Respondent No. 2 (State Project Director, Samagra Shiksha)
- The authority may frame criteria ensuring timely delivery, quality compliance, and supply-chain stability in a challenging terrain.
- Similar criteria prevail in other States; successful bids have been finalized and re-tendering would disrupt the academic calendar.
Respondent No. 1 (State of Chhattisgarh)
- Past in-State supply ensures familiarity with Chhattisgarh’s Naxal-affected topography for on-time delivery.
- Adoption of local-performance criteria is within the tendering authority’s discretion.
Factual Background
Vinishma Technologies, experienced in supplying sports kits to several States, challenged three tender notices of 21.07.2025 issued by Chhattisgarh’s School Education Department. The tenders, worth over Rs 40 crore combined, required bidders to have cumulatively supplied Rs 6 crore of sports goods to Chhattisgarh agencies in the past three financial years. After the appellant’s writ petitions, the High Court deleted other clauses but upheld this past-performance restriction. The Supreme Court granted leave and heard these appeals.
Statutory Analysis
- Article 14: Equality before law prohibits arbitrary classification in public procurement.
- Article 19(1)(g): Fundamental right to carry on trade/business includes the doctrine of a “level playing field.”
- Article 19(6): State may impose reasonable restrictions in the interest of the general public, but these must be proportionate and have a rational nexus to the procurement objective.
Alert Indicators
- 🚨 Breaking Precedent – Overrules the High Court’s validation of a State-restricted past-performance test.
- ✔ Precedent Followed – Upholds the principles from Ramana Shetty and Bharat Forge on fairness and non-discrimination in tenders.
- 🔄 Conflicting Decisions – Resolves conflict with Chhattisgarh High Court rulings that had upheld similar clauses.