Lets attack the second blank first:

the university president mistook (ii) ______ for procrastination—

The university president mistook something for procrastination. So whatever he mistook for procrastination ought to have characteristics similar to procrastination. Only deliberation, which is a long and careful consideration or discussion or slow and careful movement or thought, comes close to procrastination.Hence it is the correct choice. Vacillation is indecision, and prevarication, which is lying by being vague cannot be mistaken for procrastination.

Now lets look at the first blank:

In censuring the academic committee for apparently being (i) ______ in appointing a chancellor

Now the university president censured the academic committee for apparently being something in appointing a chancellor. So academic committee appeared to be being something, which lead to the censure. What can it be? This is connected to mistaking their behaviour for procrastination which lead to the censure. So we can say that the academic committee was apparently being very slow or delay-oriented. The only word which can give that meaning is dilatory. Overzealous is the exact opposite and biased is irrelevant.

OR

The academic committee appeared to be something which was mistaken for procrastination. So this appearance ought to have given the impression of being very slow or delay-oriented. Hence dilatory is the correct answer.