The Permanent Settlement of Land

Revenue and the Emerging British System

Cornwallis’s permanent settlement of land revenue, in the year 1793 , was the most far reaching measure since three-quarters of the revenue came from the land. The permanent zamindari settlements were made in Bengal, Bihar, Orissa, and Banaras division of U.P. This settlement was further extended in 1800 to northern Carnatic (north-eastern part of Madras) and the north-western provinces (eastern U.P.). It covered roughly 19% of the total area of British India.

The mahalwari tenure was introduced in major portion of U.P., the Punjab (with some variations) and the central provinces; while in Awadh, villages were placed under a taluqdar or middleman with whom the government dealt directly. This system covered nearly 30% of the British controlled area.

The ryotwari settlements were made in major portions of Bombay, Madras and Sindh province. The principles of this system were also subsequently applied to Assam and Burma.

Zamindari System

The main features of “settlement” in the zamindari areas were

  • The zamindars became the owners of the entire land in their zamindaries as also agents of the government in collecting land revenue.
  • The revenue demand was stabilised at a fixed annual figure.
  • The land revenue to be collected from the zamindar was permanently fixed. A zamindar was to pay over ninetenth of what he received from the peasants to the state, retaining a tenth as remuneration for his effort.
  • He had the disposal of wastelands within his jurisdiction.
  • However, the lands were liable to be sold for arrears of payment.

Thus, the land revenue collector became a landlord, subject to the threat that the lands he administered could be sold for arrears, while the tiers of lesser landholders became his tenants. The zamindar reaped the profit of rising prices and of cultivation of wasteland, while the classes below him lost their occupancy rights. Some of the consequences of this were:

  • The intended protection of these tenants proved illusory because their rights were customary, unsupported by documents. * The legal cases that ensued clogged the courts to the point of breakdown.
  • In the early days, the zamindar often lost his holding because the fixed demand was pitched too high.
  • As a result of this measure a landlord class, loyal to the British connection but divorced from touch with the cultivators, emerged in India.
  • The Permanent Settlement, by declaring zamindars as owners of land, brought into existence a wealthy and privileged class of zamindars which owed its existence to British rule. This class was compelled by its own basic interests to support it.
  • The government, receiving the revenue from the zamindars, knew little of the people and could do little for them.

The Company hoped that the zamindari class would not only be a revenue-generating instrument but serve as intermediaries for the political dominance of their rule, preserving local custom and protecting rural life from the possibly rapacious influences of its own representatives. The first part of this hope was realised as the zamindars became a conservative interest group in Indian society. But it imposed an excessive burden on the peasantry as the fixation of revenue had no scientific basis and was ad hoc. Further, there was a tendency of Company officials and Indian landlords to force their tenants into plantation-style farming of cash crops like indigo and cotton rather than rice and wheat. This was a contributory factor in many of the worst famines of the nineteenth century.

In this system even the zamindars faced problems. Their zamindaries were often auctioned for non-payment of revenue. This encouraged a new group of people to become zamindars. The urban merchants, speculators, money lenders, etc., bought zamindaries. This group had no permanent interests in the development of land or the welfare of peasantry. As a result a number of peasant uprisings took place in this region. Some examples of such uprisings were in 1795 in Panchet, 1798 in Raipur, 1799 in Balasore and in 1799-1800 in villages around Midnapore. As a consequence of such trends most zamindars eventually became absentee landlords, and tended to neglect investment on the land, with adverse impact on agricultural development of the country.

Ryotwari System

In Madras, Sir Thomas Munro retained the paternal framework of government but introduced a radically differing method of revenue management known as the ryotwari system, in which

  • The settlement was made directly with the cultivator, each field being separately measured and annually assessed.
  • The system eliminated the middleman but sometimes placed the cultivators at the mercy of lower officials, who often formed cliques of caste groups. Although Munro gradually reduced the rate of taxation from one half to one third of the gross produce, it was an excessive burden for the cultivators. The levy was not based on actual revenues from the produce of the land, but instead on an estimate of the potential of the soil; in some cases more than 50% of the gross revenue was demanded and this was too much to leave an adequate provision for the peasant.

Basically, the raiyatwari system was more pragmatic than doctrinal. By this time the local chiefs were mostly eliminated or reduced to insignificance. The contact of the administration with each individual farmer, implied in the raiyatwari system appeared more conducive to the interest of the state, which could itself assess the cultivated area and the income of the tax payer, and which could itself carry out the collection of taxes. This system also had the advantage for the peasant that he would be liberated from the oppressive domination of a big land owner. Lastly this system had less impact on the customs and social balances of the rural areas.

In western India, Mountstuart Elphinstone attempted to reconcile the restive populace of the peshwa’s dominions to British control.

  • He retained Indian agency as far as possible, allowing the Maratha nobles, or jagirdars, to retain most of their land and many of their privileges.
  • He used the ryotwari method of assessing land revenue, collecting it through local officials from the village headmen.
  • In Bombay he encouraged Western learning and science, tempting Indians to open their minds to the West.
  • In some ways he foresaw the ultimate end of British rule through voluntary Westernisation, and he took some steps toward introducing the new world of the West without antagonising the old.

Mahalwari system

In the north of the Company’s dominions, Charles Metcalfe discovered the largely autonomous village with its joint ownership of land and cultivation by caste groupings. He believed this to be the original pattern of rural organisation throughout India, and he tried to preserve it as far as possible in current conditions. Like several other administrators of the period, he was suspicious of change and wished to leave the villagers alone as far as possible.

He was strongly supported by the work of Holt MacKenzie, a Bengal ICS official whose memorandum of 1819 set a course of recognition and record of village rights for the whole of the north-western provinces and, as later revised and codified, marked the end of the Bengal system of permanent revenue settlement in this region.

This was the basis of the mahalwari system introduced in 1822, with the estate or mahals which were considered proprietary bodies, where lands belonged jointly to the village community technically called the ‘body of co-shares’. The body of co-shares was jointly responsible for the payment of land revenue though individual responsibility was not left out completely. In a typically mahalwari village, the co-sharers were the actual cultivators.

Nature and impact of the new system

The resulting system of administration of British India was still substantially Indian in pattern, though British direction and superintendence was superimposed on it. It was paternalistic and hierarchical, and it suffered, like its predecessors, from a chronic tendency to over-assess the revenue demand. The Mughal emperor was replaced by the mystical entity that came to be known among the common people as the ‘Company Bahadur’, and its representative, the governor-general, moved about with almost the same pomp and splendour as was associated with the Mughal Emperors. At higher levels the conduct and direction were exclusively European, but the officers acted in the Mughal spirit, and the administration at sub district and village level went on much as before.

There were also major changes in the socio-economic pattern. The British established on a national scale the idea of property in land, and the resulting buying and selling caused large class changes. Their new security benefited the commercial classes generally, but the deliberate sacrifice of Indian industry to the claims of the new machine industries of Britain ruined such ancient crafts as cotton and silk weaving. The new legal system, with its network of courts, proved efficient on the criminal justice side but was heavily overloaded on the civil.

The strains and the problems caused by this situation created a demand for increased Indian role in the administration and caused the first cracks in the British monopoly of higher office. Indianisation began specifically with the obvious inefficiencies of the British legal system. The picture was completed by the company’s army, separately organised in the three presidencies and officered, like the civil service, exclusively by the British. It was backed by contingents of the British army. The Bengal army preponderated in numbers and fighting spirit. By European standards it was cumbrous and inefficient; but it was still more than a match for anything that could be brought against it.


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