The petitioners, Gautham and others, have moved the High Court against the IIPSM calling for admissions for MBA and other diploma both full-time and part-time for the year 2010-11. The petitioners have alleged that the institute, established in 2006-07, is not equipped to conduct MBA courses.

Citing several irregularities in appointment and functioning, the petitioners have said that the institute has flouted norms of VTU and All India Council for Technical Education (AICTE) to set up institutions.

Alleging that Deepaknath, the Deputy Director of IIPSM, does not even have a BE degree, the petitioner has submitted documents obtained under Right to Information Act (RTI) stating that the respondent has concocted the degrees.
While maintaining that the institute with lack of transparency and poor infrastructure does not befit to be an extension centre of the University, the petitioner has sought directions to stop the admission process and has requested for criminal action against the persons responsible.

The division bench comprising Justice Manjula Chellur and Justice Venugopala Gowda has directed VTU Vice-Chancellor  H B Khincha, Professor K V A Balaji, PG Co-ordinator Nandini Sidhnal and Principal Secretary, Higher Education to file statement of objections.