Central Govt seeks President’s approval to probe IIM Rohtak director’s appointment

The Central government has initiated the process for a ‘Visitorial inquiry’ against Indian Institutes of Management (IIM) Rohtak Director Dheeraj Sharma, marking the first such action under the amended IIM Act of 2023, which grants the Education Ministry greater oversight of the country’s top business schools.

The Ministry of Education has sought approval from President Droupadi Murmu — who serves as the Visitor of IIMs — to investigate whether Sharma met the educational qualifications required for his 2017 appointment. According to sources, the Ministry is awaiting a response from Rashtrapati Bhavan.

The move comes nearly three years after the Ministry admitted in the Punjab and Haryana High Court that Sharma had allegedly “misrepresented” his credentials, leading to an improper appointment. The Ministry contends that a first-class Bachelor's degree was a prerequisite for the post, while Sharma only had a second division at the undergraduate level.

Despite this revelation in 2022, Sharma had already completed his five-year term and was reappointed for a second term by the institute’s Board of Governors (BoG) under the provisions of the original 2017 IIM Act. His current tenure is set to run until 2027.

Expanded powers under amended IIM Act

A Visitorial inquiry, authorized by the President as the Visitor of IIMs, holds the highest decision-making authority over most centrally administered institutions.

In August 2023, the government amended the IIM Act to make the President the official Visitor of the institutes, transferring key oversight powers—including appointments, audits, and inquiries—from the BoG to the central government, acting through the President. Under these new provisions, the government can now initiate inquiries and even dismiss an IIM director through the Visitor’s authority.

Multiple allegations and pending actions

The proposed inquiry into Sharma’s qualifications is only one of several actions initiated by the government. However, no substantial action has been taken against him so far, as the original 2017 IIM Act placed governance authority in the hands of each institute’s BoG rather than the government.

Following its admission in court that Sharma’s appointment was improper, the Ministry issued him a show cause notice, questioning why administrative and legal action should not be pursued against him. The notice accused Sharma of abusing his position, concealing his academic credentials, and bringing disrepute to the institute. It further alleged that he committed an act of moral turpitude and acquired financial benefits as IIM director against the public interest.

Sharma has challenged the notice in court, arguing that the government has no jurisdiction since the BoG, not the Ministry, was responsible for his appointment.

Financial scrutiny over ₹3.2 Crore variable pay

The Ministry in recent past raised concerns over a variable pay amounting to ₹3.2 crore, which Sharma received over three years (2018-19, 2019-20, and 2020-21). The Internal Audit Wing (IAW) flagged the payments, questioning their legitimacy and financial prudence.

The IAW found that the variable pay exceeded Sharma’s fixed salary by more than 200%, calling it a violation of standard financial practices. Typically, variable pay is structured as a percentage of total emoluments, but in this case, the audit deemed the structure “void.”

In response, IIM Rohtak has maintained that the payments were made in compliance with the IIM Act and were approved by the BoG with full consensus. The institute also asserted that the Ministry was informed of these payments via email over a year ago.

While the government’s scrutiny over Sharma intensifies, it remains to be seen whether the Visitorial inquiry will be approved and what consequences it may bring for the embattled IIM Rohtak director.