Tender – Judicial review of tender conditions – Scope and limits thereof –
It is well settled that the Government must have a free hand in setting the terms of the tender and the Court cannot strike down the terms prescribed by the tendering authority merely because it feels that some other terms would have been fairer, wiser or more logical. The Court would not interfere unless the action of the tendering authority is found to be arbitrary, discriminatory or actuated by mala fides.
Held, discretion of the Government in granting largesse is not unlimited. The Government cannot without adequate reason exclude any person from dealing with it or take away largesse arbitrarily. Government activities have a public element and, therefore, there should be fairness and equality in action.
(Ramana Dayaram Shetty v. International Airport Authority of India, (1979) 3 SCC 489; Directorate of Education v. EDUCOMP Datamatics Ltd., (2004) 4 SCC 19; Global Energy Ltd. v. Adani Exports Ltd., (2005) 4 SCC 435; Icomm Tele Ltd. v. Punjab State Water Supply and Sewerage Board, (2019) 4 SCC 401; Uflex Ltd. v. Govt. of Tamil Nadu, (2022) 1 SCC 165, relied on.)
Tender – Eligibility criteria – Restrictive tender condition – Reasonableness – Doctrine of level playing field –
Condition in tender notice requiring bidders to have supplied sports goods worth at least ₹6 crores (cumulative) to State Government agencies of Chhattisgarh in the preceding three financial years (2021-22, 2022-23, 2023-24, or 2022-23, 2023-24, 2024-25), held, arbitrary, unreasonable, discriminatory and violative of Articles 14 and 19(1)(g) of the Constitution of India.
Such condition had the effect of excluding bidders who, though financially sound and technically competent, had no experience of supply of sports goods to the State Government agencies of Chhattisgarh in the past three years. The State, by linking eligibility to past local supplies, created an artificial barrier against suppliers from outside the State.
Held, the object of public procurement is to secure quality goods and services for the benefit of the public exchequer. Such object can be achieved by requiring bidders to demonstrate financial capacity, technical experience, and past performance in contracts of similar nature regardless of the place of performance. Confining eligibility within one State is irrational and disproportionate to the goal sought to be achieved.
Such restriction cannot be justified as reasonable within the meaning of Article 19(6). While the State enjoys freedom to prescribe tender conditions, it cannot exercise such power in a manner that infringes constitutional guarantees or closes the market to outsiders without just cause. The doctrine of level playing field requires that all equally placed competitors must be given equal opportunity to participate, and that the State should not skew the market in favour of a few by erecting artificial barriers.
(Bharat Forge Ltd. v. Union of India, (2022) 17 SCC 188, followed.)
Constitution of India – Articles 14, 19(1)(g) and 19(6) – Doctrine of level playing field – Scope –
The doctrine of level playing field, which finds expression in Article 19(1)(g), requires that all equally placed competitors must be given an equal opportunity to participate in trade and commerce. It is designed to prevent the State from skewing the market in favour of a few by erecting artificial barriers.
Held, the impugned tender condition linking eligibility to past supply within the State of Chhattisgarh violated the mandate of Article 14 and freedom of trade under Article 19(1)(g). Such a condition curtailed the fundamental rights of otherwise eligible bidders, promoted cartelisation, and restricted wider participation.
Tender – Justification of impugned condition – Plea that State of Chhattisgarh being a Maoist affected area, local suppliers alone could ensure timely delivery – Held, untenable –
The tender in question was for supply of Sports Kits and did not involve security sensitive material. Only some districts of Chhattisgarh are affected by Maoist activities; treating the entire State as uniformly affected is incorrect. A successful bidder, though not conversant with local topography, could always engage a local supply chain for distribution. Hence, justification offered by the State was unsustainable.
Result –
Impugned orders dated 11.08.2025 and 12.08.2025 passed by High Court of Chhattisgarh in Writ Petition (C) Nos. 4263, 4266 and 4274 of 2025, as also impugned tender notices dated 21.07.2025, quashed and set aside. Respondents at liberty to issue fresh tender notices. Appeals allowed.
Held:
The impugned tender condition restricting eligibility to those who had supplied sports goods worth ₹6 crores to State Government agencies of Chhattisgarh in the last three financial years is arbitrary, unreasonable, discriminatory and violative of Articles 14 and 19(1)(g) of the Constitution. The said condition is quashed.
2025 INSC 1182
1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. OF 2025
(@ SLP (C) No. 24075 of 2025)
VINISHMA TECHNOLOGIES PVT. LTD. … APPELLANT
Versus
STATE OF CHHATTISGARH & ANR. … RESPONDENTS
WITH
CIVIL APPEAL NO. OF 2025
(@ SLP (C) No. 26192 of 2025)
AND
CIVIL APPEAL NO. OF 2025
(@ SLP (C) No. 23611 of 2025)
J U D G M E N T
ALOK ARADHE, J.
1. Leave granted.
2. These appeals take exception to orders dated 11.08.2025
and 12.08.2025 passed in three Writ Petitions preferred by
the appellant. The High Court of Chhattisgarh by the said
orders, has repelled the challenge to the impugned tender
condition contained in three tender notices dated
2
21.07.2025 which were issued for supply of Sports Kits to
the students of Government Primary School, Government
Upper Primary Schools and Government High and Higher
Secondary Schools in the State of Chhattisgarh.
3. The facts giving rise to filing of these appeals which lie in a
narrow compass, are as under:
(I) FACTS
4. The appellant is a Company registered under the
Companies Act, 2013 and claims to have experience of
supplying Sports Kits to various Departments of the States
of Bihar, Karnataka, Gujarat and Government of NCT
Delhi. The respondent No. 1 is State of Chhattisgarh
whereas respondent No. 2 is State Project Director,
Samagra Shiksha Chhattisgarh State Project Office,
Department of School Education, Government of
Chhattisgarh.
5. The Integrated Child Development Service (ICDS) Scheme
is a Scheme for providing for supplementary nutrition,
immunization and pre-school education to the children,
launched in the year 1975, is a popular flagship program
of the Central Government. The said Scheme provides for
3
the integrated package of services, for the holistic
development of the child and is a centrally sponsored
scheme implemented by State Governments and the Union
Territories. The Scheme is largely funded by the
Government of India.
6. The Samagra Shiksha Chhattisgarh State Project Office,
Department of School Education, Chhattisgarh published
three tender notices (hereinafter to be referred to as
“impugned tender notices”) on 21.07.2025 through
Government-e-Market Place Portal for supply of Sports Kits
to the students of Primary School, Upper Primary Schools
and High and Higher Secondary Schools run by the State
Government in the State of Chhattisgarh. The Sports Kits
were to be supplied to 5540 cluster resource centres
situated across all 33 districts in the State. The tender
value of the contract was Rs.15.24 crores, Rs.13.08 crores
and Rs.11.49 crores.
7. Section III(A) of the impugned tender notices prescribe
qualification criteria with additional terms and conditions.
The appellant was aggrieved by additional terms and
conditions namely, condition Nos. 1, 4, 11 and 13, which
4
rendered the appellant ineligible for participation in the
impugned tender process. It, therefore, submitted a
representation on 29.07.2025 to the State Project Director,
Samagra Shiksha, School Education Department,
Chhattisgarh. The aforesaid representation failed to evoke
any response. The appellant thereupon filed three writ
petitions, namely, Writ Petition (C) No. 4266 of 2025, Writ
Petition (C) No. 4263 of 2025 and Writ Petition (C) No. 4274
of 2025, before the High Court in which validity of the
aforesaid impugned tender conditions was challenged.
8. During the pendency of the writ petition by way of
corrigendum dated 07.08.2025 condition Nos. 1, 11, and
13 were deleted. The Division Bench of the High Court by a
common order dated 11.08.2025 passed in Civil Writ
Petition (C) No. 4266 of 2025, Writ Petition (C) No. 4263 of
2025 and by an order dated 12.08.2025 passed in Writ
Petition (C) No. 4274 of 2025, inter alia held that the
impugned eligibility condition namely, condition No. 4 with
regard to past performance is of similar nature and
purpose, as, the condition in Association of Registration
5
Plates v. Union of India and Ors1. It was further held that
respondents have demonstrated that the impugned tender
condition is not unique to the State of Chhattisgarh but is
prevalent in other States such as Gujarat, Assam, Delhi,
Orissa and Jharkhand. It was further found by the High
Court that a contract containing a similar condition, was
awarded to the appellant in the State of Jharkhand. The
High Court repelled the challenge to impugned tender
condition on the ground of discrimination and
unreasonableness.
9. It was further held by the Division Bench that State is
entitled to prescribe the condition in the impugned tender
notices, to ensure that selection of the most capable and
reliable bidder takes place, to execute the public project of
significant scale, sensitivity and public importance. It was
also held that impugned tender condition is neither
violative of Article 14 nor Article 19 (1)(g) of the Constitution
of India and relates to legitimate object of ensuring
technical competence, financial strength, operational
capacity as well as long term reliability of successful bidder.
1
(2005) 1 SCC 679
6
Accordingly, the writ petitions preferred by the appellant
were dismissed. In the aforesaid factual background, these
appeals arise for our consideration.
(II) SUBMISSIONS OF APPELLANT
10. Learned Senior Counsel for the appellant submitted that
High Court has failed to appreciate that decision of this
Court in Association of Registration Plates (supra) has
no application to the obtaining factual matrix of the case
and therefore, erred in placing reliance on the said decision
while deciding the writ petitions. It is further submitted
that the impugned tender condition which prescribes that
bidders must have supplied Sports Kits worth at least
Rs.6.00 crores (cumulative) to State Government agencies
of Chhattisgarh in last 3 financial years is violative of
Articles 14 and 19(1) (g) of the Constitution of India, as it
excludes competent suppliers from outside the State and
discourages wider participation and fosters cartelisation. It
is urged that the impugned tender condition excludes the
appellant from participating in the impugned tender. It is
therefore urged that the impugned common orders are
7
liable to be quashed and set aside and the impugned tender
condition is liable to be struck down.
(III) SUBMISSIONS OF RESPONDENT
11. On the other hand, learned Senior Counsel for
respondent No. 2 submitted that the tendering authority is
well within its power to frame the impugned tender
condition. It is further submitted that in view of
geographic/social conditions of State of Chhattisgarh, the
impugned tender condition is incorporated to safeguard
timely delivery, ensure quality compliance and prevent
supply chain disruptions. It is also submitted that
impugned condition is prevalent in other States as well. It
is pointed out that on 21.08.2025, financial bids have
already been opened and the successful bidders have been
identified. It is urged that in case this Court interferes with
the impugned tender process, the consequent re-tendering
would consume a considerable time and substantial
portion of academic year would stand forfeited.
12. Learned Senior counsel for respondent No. 1 has adopted
the submissions made on behalf of respondent No. 2 and
has submitted that the impugned tender condition has
8
been incorporated with an object to ensure that successful
bidder has the knowledge of the topography of the State of
Chhattisgarh which is a Naxal affected State, so that Sports
Kits could be timely delivered to the children of Government
Schools in the State.
(IV) ANALYSIS
13. We have considered the rival submissions and have
perused the record. For the facility of reference the
impugned tender condition is extracted below :
“(4) Past Performance Restriction :
Bidders must have supplied sports
goods worth at least
Rs.6.00 crores (cumulative) to State
Government agencies of Chhattisgarh
in the last three financial years
(2021-22, 2022-23, 2023-24 or 2022-
23, 2023-24, 2024-25).”
14. The solitary question which arises for consideration in
the instant appeals is whether the aforesaid impugned
tender condition meets the test of reasonableness and
fairness and or whether the same constitutes an arbitrary
criteria which excludes the other eligible bidders from
participation thereby violating, the mandate contained in
Articles 14 and 19(1)(g) of the Constitution of India.
9
15. Before proceeding further, it is apposite to briefly advert
to contours of judicial review with regard to tender
conditions which are well delineated. A three Judge Bench
of this Court in Ramana Dayaram Shetty v. International
Airport Authority of India & Ors.2
, held that discretion of
the Government in granting the largesse, is not unlimited
and the Government cannot give or withhold largesse in its
arbitrary discretion or at its sweet will. It has further been
held that Government cannot without adequate reason
exclude any person from dealing with it or take away
largesse arbitrarily. It also held that activities of the
Government have a public element and therefore there
should be fairness and equality. It is well settled in law that
Government must have free hand in setting the terms of the
tender and the Court cannot strike down the terms of the
tender prescribed by the Authority merely because it feels
some other terms in the tender would have been fairer,
wiser or more logical3. It is equally well settled legal
proposition that in the matter of formulating conditions of
2
(1979) 3 SCC 489; AIR 1979 SC 1628
3 Directorate of Education & Ors. v. EDUCOMP Datamatics Ltd. & Ors. (2004) 4 SCC 19
10
tender document unless the action of tendering authority
is found to be arbitrary and malicious the Court would not
interfere4. It is also well settled in law that a Court cannot
sit over judgment on what should be the eligibility criteria
in the tender notice unless the same is arbitrary,
discriminatory or actuated by mala fides.
5
16. The principle of non-discrimination is embodied in Article
14 of the Constitution of India. Article 14 has to be read in
conjunction with Rights conferred by other Articles like
Article 21 of the Constitution of India. Article 21 of the
Constitution of India refers to Right to Life which includes
‘opportunity’ as well. The doctrine of level playing field is an
important concept while construing Article 19 (1) (g) of the
Constitution of India. Article 19(1) (g) confers Fundamental
Right to carry out business to a company, it is entitled to
invoke the doctrine of level playing field which is however,
subject to public interest. The doctrine of level playing field
4 Global Energy Ltd. & Anr. v. Adani Exports Ltd. & Ors. (2005) 4 SCC 435 - Shimni Utsch India Pvt. Ltd.
& Anr. v. West Bengal Transport Infrastructure Development Corporation Ltd. & Ors (2010) 6 SCC 303.
5
Icomm Tele Ltd vs. Punjab State Water Supply and Sewerage Board & Anr. (2019) 4 SCC 401; Uflex
Ltd. V. Government of Tamil Nadu & Ors. (2022) 1 SCC 165
11
provides the space within which equally placed competitors
are allowed to bid so as to subserve larger public interest. 6
17. In the backdrop of well settled legal principles, we advert
to the fact of the case in hand. The present tender is for
supply of Sports Kits to the students of Primary School,
Upper Primary School and High and Higher Secondary
School run by the State Government in the State of
Chhattisgarh. The eligibility criteria mentioned in the
impugned tender notices must have rational nexus with the
object sought to be achieved i.e., supply of good quality
Sports Kits to students of the school, at the best price. The
eligibility criteria in impugned notices therefore, should be
framed in a manner which encourages wider participation
and secures the best prize for the State, which in turn
safeguards the public exchequer.
18. This Court in BHARAT FORGE supra has enunciated the
doctrine level playing field and has stated that the same
finds expression in Article 19(1)(g) of the Constitution. The
doctrine of level playing field requires that all equally
placed competitors must be given an equal opportunity to
6 UOI & Ors. Bharat Forge Ltd. & ANR. (2022) 17 SCC 188.
12
participate in trade and commerce. It is designed to prevent
the State from skewing the market in favour of few by
erecting artificial barriers. In the instant case, the
impugned tender condition has the effect of excluding
bidders who though otherwise financially sound and
technically competent, have no experience of supply of
sports goods to the State Government agencies of
Chhattisgarh in past three years. The State by linking the
eligibility criteria with past local supplies has created an
artificial barrier, against the suppliers who had no past
dealing with the State of Chhattisgarh. The impugned
condition curtails the fundamental rights of the bidders,
who have been ineligible to participate in the tenders.
19. The object of public procurement is to secure quality
goods and services for the benefit of public exchequer. The
said object can be achieved by requiring the bidders to
demonstrate financial capacity, technical experience, and
past performance in contracts of similar nature, regardless
of place of performance of the contract. To confine the
eligibility to participate in the tender, within one State is
13
not only irrational but is also disproportionate to the goal
of ensuring effective delivery of Sports Kits.
20. Such a restriction, therefore, cannot be justified as
reasonable within the meaning of 19(6) of the
Constitution of India. The State while it enjoys the freedom
to prescribe the conditions in the tender, cannot exercise
that power in a manner that infringes upon constitutional
guarantees, by closing the market to outsiders without just
cause. The doctrine of level playing field requires that gates
of competition be opened to all who are equally placed. The
impugned tender condition excludes the competent and
experienced suppliers, who may have executed contracts of
far greater magnitude in other States or for the Central
Government departments, from participating in the tender
and has the impact of promoting cartelisation. The
impugned condition operates as a closed door to outsiders
and restricts the wider participation of bidders and restricts
competition. The impugned tender condition, therefore, is
violative of Article 14 and also offends Article 19(1)(g) of the
Constitution of India.
14
21. The justification advanced by the State that Chhattisgarh
being a Maoist affected area and only those with past
experience of supply in the State to State Government
agencies of Chhattisgarh can be relied upon, is untenable
for several reasons. Firstly, the tender in question is not for
security sensitive equipment but is for supply of Sports Kits
which does not involve, any special risk or security
repercussions. Secondly, only some districts of
Chhattisgarh are affected by Maoist activities, and it is
incorrect to treat the entire State, as uniformly affected by
Naxalites, for exclusion of other eligible bidders. Thirdly,
a successful bidder, who may not be conversant with the
topography can engage a local supply chain to supply the
Sports Kits.
22. In the light of aforesaid discussion this Court finds that
impugned tender condition is arbitrary, unreasonable and
is discriminatory. The same does not have any rational
nexus to the object of ensuring effective supply of Sports
Kits to the children in State. It offends the mandate of
Article 14 and freedom of trade guaranteed by Article
19(1)(g) of the Constitution of India.
15
(V) CONCLUSION
23. In the result, the impugned orders dated 11.08.2025 and
12.08.2025 passed in Writ Petition (C) No. 4266 of 2025,
Writ Petition (C) No. 4263 of 2025 and Writ Petition (C) No.
4274 of 2025 respectively by the High Court as well as
impugned tender notices dated 21.07.2025 issued by
Department of School Education, Government of
Chhattisgarh for supply of Sports Kits to students of
Government Primary, Upper Primary, High and Higher
Secondary Schools are quashed and set aside. Needless to
state that respondents are at liberty to issue fresh notices
inviting tenders. Accordingly, the appeals are allowed.
……………….……………J.
[SANJAY KUMAR]
..….……………………….J.
[ALOK ARADHE]
NEW DELHI,
OCTOBER 6, 2025.
