In Islam, things are crystal clear: Prophet Mohammad is the last Prophet of Islam and Koran is the Final Testament. But Islamic texts do predict the arrival of Imam Mahdi; the prophesied redeemer of Islam and there are plenty of signs and premonitions to ascertain his arrival. Imam Mahdi's full name will be that of Prophet Mohammad, he will have a birthmark over his forehead, he will be born to the North of Mecca, he will establish global Islamic caliphate after subjugating Christians, will compel Jesus to follow prayers led by him and will lead the Ummah on the final day of judgment, among others.
In Hinduism, Krishna promises constant incarnations to uplift the dharma and to end evil time and again. But Hinduism lacks any central authority like Vatican and Mecca. There are no absolute measures and standards mentioned in sacred texts, at least known to common Hindus, to judge, accept and reject claims over incarnations. Most of the times the decision of accepting someone as incarnation is dictated from above, though many times it is personal opinion too. But then Krishna says the following:
"Sattva, Rajas, Tamas – light, fire, and darkness – are the three constituents of nature. They appear to limit in finite bodies the liberty of their infinite spirit." (The Bhagavad Gita, Chapter 14, Verse 5).
If one reads the Gita completely it becomes apparently clear that the light belongs to Brahmins, fire belongs to Kshatriyas and darkness belongs to Vish and lower castes. Many of the Brahmins are proud of this. Many of us do not know this fact that Brahmins as per sacred laws, are kin to gods and therefore, they are indeed preferred people in Hinduism. As per general Hindu beliefs, all incarnations of Vishnu would favour Brahmins over others and as long as this is not stated by the preacher, he just cannot be considered the incarnation of Vishnu, so to say.
So how can one judge a person to be an incarnation of Ishvara as per Hindu beliefs? The answer is when high Brahmins of all regions accept somebody to be incarnation then he and she can be considered a manifestation or minimally a form of Ishvara.
The fact is that not too many high Brahmins would accept Sai Baba to be incarnation of Vishnu, though some do accept him to be one. The fact that Sai Baba was born of Muslim parents as many believe though officially his birth and childhood is unknown and the fact that he belonged to poor class does help the cause of orthodox high priest community.
Anyway, Sai Baba is no form of Ishvara but a guru. But non-Brahmins can be incarnations of Vishnu provided they accept the superiority of Brahmins over religious matters, uphold the founding principles of Sanatana Dharma, including the caste system, segregation of communities, and they believe in birth-based traditions etc.
Vishnu can mostly be a preserving deity and can be reformer only if urgently required but within a limit pleasantly accepted and even dictated by high priest community of his time and later. I do not think that Sai Baba's preaching fall into any of these categories. A socio-religious reformer can hardly be considered an incarnation of Vishnu.
There is another factor determining and deciding who could be considered an incarnation of Ishvara and that is the belief of followers. Hinduism is not invented by a single preacher and not exclusively even by Rama and Krishna together. In addition, there is not much place for decrees and proclamations for followers of Hinduism. Therefore, if some sections of Hindu society accept someone to be incarnations of Ishvara then he and she is indeed but for them and not for all.
The fact is that there are millions of Hindus who consider Sai Baba to be incarnation of Vishnu and this should be respected. But equally true is the fact that there are millions more who do not consider him above guru and this should not be forgotten as well.
However, from the puritan principles of Sanatana Dharma Sai Baba is no incarnation of Vishnu. Those who might have read the Death of Vishnu by Manil Suri may recall that Vishnu; the odd-job man, was declared an incarnation of Vishnu but after his death by the second most intriguing character of the novel, Jalal Khan, a Muslim. That's a great fantasy and politically correct too in this diffusiveness dominated era.
But, this is not how incarnation of Vishnu can be declared and accepted. The dominance of Brahmins is the eternal law of Hinduism and this is not going to change in any little time. Neither that should be challenged by any activist group. Such an attempt can be overall harmful to Hinduism in both short and long terms.
There is no point in denouncing the Shankaracharya for saying what is true from many perspectives though it may appear politically incorrect from the dominant view at present. In the end I quote Apastamba:
"Dharma and Adharma do not go about saying, 'Here we are'; nor do gods, centaurs or ancestors say, 'This is right, that is wrong'."
I can only say that excessive usage of relativism in Hinduism and Hindu sacred texts emphasizing many world interpretations do not mean that Hinduism is universal in nature though barring some, most of the quotes appear very nice to refer.
I would say
relativism does not imply nihilism and Hinduism has sufficient
inertias to be labelled as having authentic religious doctrine. It
surely does not mean that all probable things are possible. Let the
controversy over the status of Sai Baba be over and all accept and
understand opposing views.