Legal Review and Analysis of Vinishma Technologies Pvt Ltd vs State of Chhattisgarh & Anr 2025 INSC 1182

1. Heading of the Judgment

Case Title: Vinishma Technologies Pvt. Ltd. vs State of Chhattisgarh & Anr.
Citation: 2025 INSC 1182
Court: Supreme Court of India
Jurisdiction: Civil Appellate Jurisdiction
Judges: Justice Sanjay Kumar and Justice Alok Aradhe
Date of Judgment: October 06, 2025

2. Related Laws and Legal Provisions

The judgment primarily interprets and applies the following constitutional and legal principles:

• Constitution of India:
  Article 14: Right to Equality and the guarantee against arbitrary state action.
  Article 19(1)(g): Right to practice any profession, or to carry on any occupation, trade or business.
  Article 19(6): Specifies that reasonable restrictions can be imposed on the rights under Article 19(1)(g) in the interest of the general public.

• Key Legal Doctrines:
  Doctrine of Level Playing Field: A principle derived from Articles 14 and 19(1)(g) requiring the state to provide equal opportunity to all similarly situated bidders in public procurement.
  Judicial Review of Tender Conditions: The well-settled principles governing when a court can interfere with the terms of a tender.

• Significant Precedents Cited:
  Ramana Dayaram Shetty v. International Airport Authority of India (1979) 3 SCC 489: Established that the government's power to grant largesse is not arbitrary and must be exercised fairly.
  UOI & Ors. v. Bharat Forge Ltd. & Anr. (2022) 17 SCC 188: Elaborated on the "doctrine of level playing field."

3. Basic Judgment Details

This civil appeal was filed by Vinishma Technologies Pvt. Ltd., a company, challenging the orders of the Chhattisgarh High Court.

• Origin of Case: The State of Chhattisgarh issued tender notices for the supply of Sports Kits to government schools. The appellant company was rendered ineligible by a specific condition in the tender.

• High Court Outcome: The High Court dismissed the appellant's writ petitions, upholding the validity of the impugned tender condition.

• Supreme Court Outcome: The Supreme Court allowed the appeals, set aside the High Court's orders and the tender notices, and permitted the state to issue fresh tenders.

4. Core Legal Analysis and Reasoning

The core issue before the Supreme Court was the constitutional validity of a specific tender condition that restricted participation to only those bidders who had prior supply experience within the state of Chhattisgarh.

A. The Central Issue: Arbitrariness in Public Procurement

The dispute centered on Condition No. 4 (Past Performance Restriction) of the tender, which stated:

"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..."

The appellant, an experienced supplier to other states, was excluded by this condition. The Supreme Court analyzed whether this condition was arbitrary, discriminatory, and violative of the fundamental rights under Articles 14 and 19(1)(g) of the Constitution.

B. The Legal Framework: Level Playing Field and State Largesse

The Court began by reiterating the settled principles of judicial review in tender matters. While the government has a free hand in setting tender terms, this power is not absolute. Citing Ramana Dayaram Shetty v. International Airport Authority of India, the Court emphasized that the government's actions in granting contracts (state largesse) must be fair, non-arbitrary, and based on a public element.

The Court heavily relied on the "doctrine of level playing field," as expounded in UOI & Ors. v. Bharat Forge Ltd. This doctrine, which finds expression in Articles 14 and 19(1)(g), requires that all equally placed competitors must be given an equal opportunity to participate. It is designed to prevent the State from skewing the market in favour of a few by erecting artificial barriers.

C. Application to the Case: Creating an Artificial Barrier

Applying these principles, the Supreme Court found the impugned condition constitutionally infirm for the following reasons:

1. No Rational Nexus to Object: The Court held that the condition had no rational connection to the tender's objective, which was to secure good quality Sports Kits at the best price. A bidder's financial strength and technical competence can be demonstrated through past performance in any state or with the central government. Confining eligibility to prior dealings only with Chhattisgarh was irrational and disproportionate.

2. Violation of Article 19(1)(g): The condition created an "artificial barrier" that curtailed the fundamental right of otherwise competent and experienced bidders from outside Chhattisgarh to carry on their trade. The Court held that such a restriction could not be justified as a "reasonable restriction" under Article 19(6).

3. Anti-Competitive and Promotes Cartelisation: By effectively closing the market to outsiders, the condition restricted wider participation, stifled competition, and had the potential to foster cartelisation among a few local suppliers. This was detrimental to public interest as it could lead to higher prices and lower quality for the state exchequer.

4. Rejection of State's Justification: The Court rejected the state's argument that the condition was necessary due to Chhattisgarh being a Naxal-affected area. It reasoned that (i) supplying Sports Kits is not a security-sensitive operation, (ii) the entire state is not uniformly affected, and (iii) any logistical challenges could be overcome by engaging local logistics partners.

D. The Supreme Court's Finding

The Supreme Court concluded that the impugned tender condition was arbitrary, unreasonable, and discriminatory. It violated the mandate of Article 14 and the freedom of trade and commerce guaranteed under Article 19(1)(g) of the Constitution. The condition was struck down.

5. Final Outcome and Directions

The Supreme Court passed the following orders:

1. The appeals were allowed.

2. The impugned orders dated 11.08.2025 and 12.08.2025 passed by the Chhattisgarh High Court were quashed and set aside.

3. The impugned tender notices dated 21.07.2025 issued by the Department of School Education, Government of Chhattisgarh, were also quashed and set aside.

4. The respondents (State of Chhattisgarh) were placed at liberty to issue fresh notices inviting tenders in accordance with the law.

Multiple Choice Questions Based on the Judgment

1. In Vinishma Technologies Pvt. Ltd. vs State of Chhattisgarh (2025 INSC 1182), the Supreme Court struck down the tender condition primarily because it?
a) Was too financially demanding for small businesses.
b) Had already resulted in the selection of a cartel.
c) Created an artificial barrier and violated the doctrine of a level playing field.
d) Was not published on a widely recognized e-portal.

c) Created an artificial barrier and violated the doctrine of a level playing field.

2. The 'Doctrine of Level Playing Field', as applied in this judgment, is primarily derived from which articles of the Indian Constitution?
a) Articles 21 and 32
b) Articles 14 and 19(1)(g)
c) Articles 301 and 302
d) Articles 265 and 266.

b) Articles 14 and 19(1)(g)