IIM Rohtak fees ‘exorbitant’; institute violates not-for-profit motive: CAG report

NEW DELHI: The Indian Institute of Management (IIM) Rohtak has been charging “exorbitant fees” from students, the Comptroller and Auditor General of India (CAG) observed in its audit report of the institute.

IIM Rohtak’s records between 2019 and 2021 were audited by the CAG, where it found that the fee structure of the institute is three-four times higher than the expenditure and continues to increase on a year-on-year basis.

“The fee structure is so designed that the receipts are 2-3 times the expenditure of the institute and too is on an increasing trend year to year. Instead of being invested in growth of institute and utilised on conducting research work, the funds amounting to ₹ 2,51,96,45,000 were deposited in fixed accounts (term deposits) in banks, on which interest amounting to ₹ 17,68,22,281 was earned,” the CAG report stated.

The increasing trend of revenue over expenditure year to year forfeits the “not-for-profit” intent of the institute, the CAG report further stated. In the last three years, IIM Rohtak has earned a surplus of more than 200 percent. In 2020-21, IIM Rohtak spent only Rs 2,691 lakh but earned Rs 7,826 lakh.

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IIM Rohtak: CAG report on fees

The report, accessed by Careers360 says that “according to Section 10 (23C) (iiiab) of the Income Tax Act, 1961, any income received by a person on behalf of any university or any educational institution existing solely for educational purposes and not for purposes of profit, and which is wholly or substantially financed by the government, is entitled to exemption.”

IIM Rohtak receipt, expenditure audit

Careers360 sent a detailed questionnaire to IIM Rohtak to which the institute has not yet responded. The official spokesperson said that the institute has recently submitted responses to the “draft CAG report” and the final report is yet to come.

In response to the audit, as per the CAG report, the institute replied that IIM Rohtak’s fee structure has been decided with the approval of the apex body of the institute and in line with the fee charged by similar institutes of national importance. “The annual fee is dependent on several factors including annual student intake, yearly institute expenditure, future expansion plans, fee of peer institutes etc. and many others,” IIM Rohtak told the CAG.

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However, the CAG rejected this response and said the institute violated the “not-for-profit motive” of the institute as stated in the IIM Act 2017.

“The exorbitant charging of fee results into deprivation of the low income group students from reach of education who, at the time of applying for admission, are apprehensive of affording the payment of the fee on too much higher side, thereby resulting into constricting, circumventing and denial of the equality of opportunity for education and employment,” the report said.

According to the audit report, grants from the government to IIM Rohtak have been below the 50 percent threshold every year from the 2015-16 to the 2018-19 academic session.