Step 1: Concept
Potassium permanganate ($KMnO_{4}$) is a powerful oxidizing agent used in medicine.
Step 2: Meaning
Antimicrobial agents work through various mechanisms such as oxidation, halogenation, or protein precipitation.
Step 3: Analysis
$KMnO_{4}$ releases nascent oxygen when it comes into contact with organic matter. This oxygen oxidizes the cellular components of microorganisms, leading to their destruction.
Step 4: Conclusion
Therefore, the primary mechanism by which $KMnO_{4}$ exerts its antimicrobial effect is through oxidation.
Final Answer: (B)