Many people have been unable to install VirtueMart 1.1.2 since its release. The common error message they were getting was:
There was an error uploading this file to the server. Unable to find install package
Just from this message it's hard to determine what the real problem could be. The main reason is that the component install file (com_virtuemart_1.1.2.j15.zip) is about 2.1 MB in size. Too large, because a maximum upload file size of only 2MB is common for most PHP configurations. If you attempt to upload a larger file, the upload fails, because larger files are not allowed.
How to get around this problem - change the maximum upload file size? There are easier solutions: don't use the web uploader...