The recommendation of the lokayukta in the case made in May has been rejected by the President, government sources said.
The decision comes a fortnight after a Delhi court ordered registration of FIR against Dikshit and others in the same case. However, the high court had stayed the order till September 19 after the Delhi government challenged it.
Lokayukta Justice Manmohan Sarin had recommended to the President to administer "caution" to Dikshit for alleged misuse of public funds for a series of advertisements carried out in print and outdoor media in 2007-08 with punchline "Delhi is changing".
The anti-graft ombudsman had also recommended to the President to "advise" Dikshit to reimburse either herself or through her party a sum of Rs 11 crore as half the cost of the advertisements in 2008 or any amount the President finds adequate.
The rejection of the lokayukta order is seen as huge relief to Dikshit ahead of the assembly polls slated for November when she will try to seek an unprecedented fourth consecutive victory.
Dikshit had rejected the allegations. The chief minister was holding charge of the department of information and publicity when the advertisement campaign was carried out.
The court order had come following a complaint filed by Delhi BJP leader Vijender Gupta who had alleged that Dikshit had misused government funds to the tune of Rs 22. 56 crore in the advertisement campaign.
The lokayukta had initiated the inquiry into the matter following a complaint filed in 2009 also by Gupta.
In his complaint, Gupta had charged Dikshit with abusing her position as chief minister by carrying out an advertisement campaign with a view to gain political mileage in the assembly election in 2008.
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