In the year 1780 the company’s privileges ran out, but this was during the crisis of the American Revolution, so a decision by the British government was delayed until 1784. Charles James Fox proposed a radical measure to transfer the control of British India to seven commissioners which was defeated by the influence of King George III in the House of Lords. However the following year the matter was settled by Prime Minister William Pitt the Younger’s India Act of 1784.
Pitt’s India Act (1784), established a dual system of control by the British government and the East India Company, by which the company retained control of commerce and day-today administration but control over important political matters was assumed by the British government; this system lasted until 1858. It provided for a joint government of the Company (represented by the Directors), and the Crown (represented by the Board of Control).
This act provided for the appointment of a Board of Control of six members which was constituted with two members of the British Cabinet and four from the Privy Council, one of whom was the President of the Board and who effectively became the minister for the affairs of the East India Company. The board had all the powers and control over all the acts and operations, relating to the civil, military and revenue aspects of the Company.
The Council was reduced to three members and the Governor General was empowered to overrule the majority. The Governors of Bombay and Madras were also deprived of their independent powers. Calcutta was given greater powers in matters of war, revenue, and diplomacy, thus becoming in effect the capital of Company possessions in India.
Its essence was the institution of dual control
The directors were left in charge of commerce and as executants, but they were politically superintended by a new Board of Control, the president of which, Henry Dundas, soon emerged effectively as the minister for India. The directors dealt with the board through a secret committee of three, but their dispatches to India could be altered, vetoed, and dictated by the board.
The Governor-General could be recalled by the Crown. In India the Governor’s council was reduced to three, including the Commander in Chief, and by an amending act he acquired the veto, which Warren Hastings had missed so much.
A provision was made that there would be a Parliamentary inquiry before each 20-year renewal of the Company’s charter.
Some of the other Important Provisions of the Act Were
The Court of Directors was to establish a secret committee to work as a link between the Board and the Court.
The Governor General’s council would consist of three members one of whom was the commander-in-chief of the King’s army in India. In case the members present in a meeting of the council were at any time were equally divided in opinion, the Governor General would have two votes (one his own and another casting vote).
The government would stop further experiments in the revenue administration and proceed to make a permanent settlement with zamindars with a moderate rate of revenue demand.
The government would establish permanent judicial and administrative systems for the governance of the new kingdom.
All civilians and military officers were to provide the Court of Directors a full inventory of their property in India and in Britain within two months of their joining their posts.
Severe punishment including confiscation of property, dismissal and jail, was provided for any civilian or military officer found guilty of corruption.
Receiving gifts, rewards, and presents in kind or cash from the rajas, zamindars, etc. were strictly prohibited and people found guilty of these offences were to be charged with corruption.
By a supplementary Bill passed in 1786, Lord Cornwallis was appointed as the first Governor General, and he then became the effective ruler of British India under the authority of the Board of Control and the Court of Directors.
Assessment of the Pitt’s India Act
Pitt’s India Act proved to be a landmark because it gave the British government control of policy in India. The complicated dual system developed into a seesaw arrangement of give and take, becoming ever-stronger on the government side as greater ability, influence, and power had their effect. The inquiry provision produced a national examination of affairs in India every 20 years, with each successive stage marking a further diminution in the Company’s political power.
On the first such inquiry, in the year 1793, the Company repelled an attempt to compel it to support Christian missionary work; this incident led to the foundation of the Church Missionary Society in 1799.
In 1813 the Company was obliged by Parliament to admit missionaries and was deprived of its monopoly on trade.
By the Act of 1833 it lost its trade altogether and was thenceforth a governing corporation under increasing state surveillance.
In 1853, with the introduction of competitive examinations, the Company lost most of its patronage and also had to admit nominated directors.
Policies were increasingly dictated to a sullen and apathetic Board of Directors.
The last case of the recall of a Governor General by the Company was that of Lord Ellenborough in 1844 and this effectively marked the end of the Company’s role in making major decisions with regard to Indian affairs.
The company was thus reduced to being a managing agency of the British government.
The system set up by the Pitt’s India Act did not undergo any major changes during the existence of the Company’s rule in India.