The 1984 batch officer succeeded P K Thakur, who retired yesterday.
The Bihar government defended its decision to opt for Dwivedi, saying he was appointed on the basis of his "clean" service record.
"Dwivedi has been appointed to the post of the DGP on the basis of his clean service record and his seniority. There were four officers in the state of DG rank of whom Dwivedi was the senior-most," Principal Secretary (Home) Amir Subhani told reporters here.
"After the Bhagalpur riots, a three-member judicial commission was set up to inquire into the causes behind the communal flare-up and the role played by district administration.
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"Justice Ramnandan Prasad, who headed the commission, had in his report praised Dwivedi's handling of the situation, and said there was nothing to suggest that he was guilty of dereliction of duty at any stage," he said.
Two other members of the panel had struck a discordant note and jointly submitted a separate report of inquiry where "adverse remarks were made against Dwivedi", Subhani said.
The clarification came in the wake of allegations by main opposition RJD that Chief Minister Nitish Kumar had made the appointment under pressure from his ally the BJP.
Dwivedi was the superintendent of police of Bhagalpur in 1989 when the city was ravaged by horrific communal riots and his handling of the situation had come in for a lot of criticism, RJD national spokesman Manoj Jha had said after Dwivedi's appointment was announced.
Former chief minister and Hindustani Awam Morcha leader Jitan Ram Manjhi, who yesterday quit the NDA and joined the RJD-Congress combine, had also expressed concern over Dwivedi's appointment to the top post.