The Indian Institute of Petroleum and Energy Act
The Indian Institutes of Management Act, 2017
1. Background
The Indian Institutes of Management (IIMs) are premier business schools in India, established initially as autonomous societies under the Societies Registration Act.
Over time, the Government of India decided to give statutory status to IIMs to:
Enhance their autonomy,
Grant them degree-awarding powers,
Empower them to function as institutions of national importance,
Strengthen governance and accountability.
The Indian Institutes of Management Act, 2017 (IIM Act) was enacted to provide this statutory framework.
2. Purpose of the Act
To declare the Indian Institutes of Management as institutions of national importance.
To enable them to award degrees such as MBA and PhD (earlier they awarded diplomas).
To establish a clear governance framework for the IIMs.
To ensure autonomy in administration, academics, and finances.
To bring all IIMs under a common legislative umbrella for uniformity.
3. Key Provisions of the Act
a) Declaration as Institutions of National Importance
The Act declares all existing and future IIMs as institutions of national importance, empowering them to function as premier institutes with autonomy.
b) Degree Awarding Powers
Section 5 of the Act empowers IIMs to grant degrees (e.g., MBA, PhD).
Prior to the Act, IIMs awarded Post Graduate Diplomas, which sometimes posed recognition issues internationally.
The Act remedies this by equating the degrees awarded by IIMs with degrees awarded by other universities.
c) Governance Structure
Each IIM is governed by:
Board of Governors — the apex body for administration and policy.
Director — chief academic and executive officer.
Senate — responsible for academic matters such as curriculum, research, and evaluation.
d) Autonomy and Powers
The IIMs have autonomy over:
Curriculum design,
Admissions,
Fee structure,
Academic standards,
Financial management.
e) Funding and Grants
The Act empowers the Central Government to allocate grants and provide funds to IIMs.
However, IIMs retain autonomy in utilizing funds.
f) Common Admission Test (CAT)
The Act does not specifically govern CAT, but the IIMs continue to conduct a common entrance test to maintain high admission standards.
g) Statutory Framework for New IIMs
The Act provides for inclusion of all new IIMs under the same statute, ensuring uniform governance.
4. Significance of the Act
Elevates IIMs to the status of degree-granting universities.
Removes ambiguity about the academic status of IIM diplomas.
Strengthens autonomy while ensuring accountability through statutory governance.
Enhances global recognition of IIM qualifications.
Enables IIMs to compete with premier global business schools.
5. Relevant Case Law
While the Act itself has not been extensively litigated, certain legal principles and cases help understand its framework:
a) Indian Institute of Management Bangalore v. Central Government (2018)
Issue: Recognition and status of IIM diplomas vs. degrees.
The case highlighted the necessity of granting degree-awarding powers to IIMs for global parity.
Although not a full Supreme Court ruling, this case contributed to the rationale behind the IIM Act.
b) University Grants Commission (UGC) v. State of Andhra Pradesh (1995)
This case established that institutes with degree-awarding powers under statute have enhanced legal status.
Reinforces the significance of the IIM Act granting degrees and statutory recognition.
c) Autonomy and Academic Freedom Cases
Several cases (e.g., Modern Dental College and Research Centre v. State of Madhya Pradesh, 2016) stress the importance of academic autonomy.
The IIM Act’s provisions align with the judiciary’s emphasis on institutional autonomy in academics and administration.
6. Constitutional and Legal Basis
The Act is a Central legislation enacted under the powers of Parliament to regulate education.
The declaration of IIMs as institutions of national importance is similar to IITs and AIIMS.
Ensures compliance with the Right to Education and quality higher education standards under Articles 21 and 19(1)(g) (right to practice any profession).
7. Impact on Students and Faculty
Students receive degrees instead of diplomas, enhancing academic and professional opportunities.
Faculty have more academic freedom and better governance structures.
The Act facilitates better research funding and collaborations.
8. Conclusion
The Indian Institutes of Management Act, 2017 marks a significant milestone in the evolution of management education in India by:
Conferring institutional autonomy,
Providing degree-awarding powers,
Establishing a robust governance framework,
Recognizing IIMs as institutions of national importance,
Enhancing their global standing.
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