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SC: Local experience clause in State tender struck down—restriction violates equality and fair competition in procurement

SC: Local experience clause in State tender struck down—restriction violates equality and fair competition in procurement

Case Name: Vinishma Technologies Pvt. Ltd. v. State of Chhattisgarh & Anr.

Citation: Civil Appeal arising out of SLP (C) No. 24075 of 2025 (with connected appeals)

Date of Judgment: 6 October 2025

Bench: Justice Sanjay Kumar and Justice Alok Aradhe

Held: The Supreme Court quashed a tender condition issued by the State of Chhattisgarh that restricted eligibility to bidders having supplied sports kits worth at least ₹6 crore to State Government agencies within Chhattisgarh in the preceding three years. It held that such a requirement was arbitrary and violative of Articles 14 and 19(1)(g) of the Constitution, as it excluded equally competent bidders from other States and defeated the principle of a “level playing field.” The State may frame eligibility norms to ensure reliability and capability but cannot impose discriminatory conditions lacking a rational nexus with the tender’s objective.

Summary: The tender in question was issued under the Samagra Shiksha programme for the supply of sports kits worth over ₹40 crore to government schools across Chhattisgarh. The High Court had upheld the tender clause, citing regional familiarity and security concerns due to Naxal-affected areas. Overturning this, the Supreme Court held that the supply of sports kits was not a security-sensitive project and that local topography could not justify exclusion of experienced national suppliers. It emphasized that public procurement must secure quality and price efficiency through open and competitive participation. Restricting eligibility to local past suppliers curtailed competition, encouraged cartelisation, and lacked any rational relation to the public interest.

Decision: Appeals allowed. The Supreme Court set aside the High Court’s judgment and quashed the impugned tender notices. The State was directed to issue fresh tenders with fair, non-discriminatory eligibility criteria consistent with constitutional principles of equality and free trade.

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