The faculty of the Indian Institute of Management, Bangalore, has in a resolution said the Centre owes Rs 62.74 crore (Rs 627.4 million) to the institute, of which Rs 3.15 crore (Rs 31.5 million) relates to the period prior to 1997-98.

The faculty members submitted a resolution to the board of governors of the institute that said some of the financial decisions taken by the government had been 'worrisome.'

"In 2003, we were informed that the Bharat Shiksha Kosh had been set up to route grants and donations that we, as IIM, Bangalore, may attract based on our reputation. The second was the retrospective revocation of the Block Grant funding scheme that was in effect from 1994," the resolution said.

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"In May 2003, the secretary in the human resources development (HRD) ministry informed the institute that the scheme had been withdrawn from 1997-98. The reason given was that this scheme had the HRD ministry's approval but not that of the finance ministry. As of March 31, 2003, the government of India owed IIM, Bangalore, Rs 62.74 crore, of which only Rs 3.15 crore relates to the period prior to 1997-98. Given these unanticipated changes in government funding, IIM, Bangalore, would need to take charge of its finances and insulate itself from policy changes in the future," the resolution added.

In 1994, IIM, Bangalore, earned 40 per cent of its operating expenditure. Today, after including the interest income, it generates a surplus.

"Following global accounting standards, we provided for terminal benefits amounting to Rs 22.5 crore (Rs 225 million), while computing the financial surplus. Further, we are confident of meeting all our operating expenditure from 2004-2005," it said.

According to the resolution, IIM, Bangalore, has a corpus of Rs 53.96 crore (Rs 539.6 million) and a general reserve of Rs 9.40 crore (Rs 94 million), besides a terminal benefits reserve of Rs 22.5 crore.

"Our reserves will increase by over Rs 60 crore (Rs 600 million) if we receive all the funds promised to us by the Government of India under its earlier matching grant scheme," the resolution added.

The resolution also points out that "no government of India representative has attended the last three board meetings."

Elaborating on the attitude of the government, the resolution says, "The government has been insisting on having two representatives on the board sub-committee (the finance committee) who are neither members of the board nor employees of the institute. The board recently agreed to the government's nominations to the finance committee. Neither of them has attended the meeting since their appointment," it said.