Pitt’s India Act 1784

Table of Contents

The Pitt’s India Act 1784, also known as the East India Company Act 1784, was an Act of the Parliament of Great Britain enacted to address the shortcomings of the Regulating Act of 1773. The Regulating Act of 1773 had 2 major shortcomings namely:

It did not give the British government effective control over the company’s administration, something that was the main intention of the Act.
It also did not solve the conflict between the East India Company and its opponents in England, keeping East India Company’s monopoly in India intact.

As the Regulating act was not working the way it was intended to work, in 1781 two committees namely – Selected Committee and Secret Committee were set up to probe the affairs of East India Company in India.

The Selected Committee probed the relations between the Supreme Court and the Council in Bengal.
The Secret Committee hatched plans to deal with the Marathas and caused the Anglo-Maratha wars.

Both the committees submitted their reports to the British Parliament. These reports were used by the Parliamentarians to expose the weaknesses of the East India Company and presented a strong case for controlling the affairs of the East India Company in India.

Named after the then Prime Minister William Pitt the Younger (known as ‘Younger’ because his father was also British prime minister who was known as William Pitt the Elder), the Pitt’s India Act 1784 aimed to reform and regulate the administration of the British East India Company, which was a British joint-stock company that had been granted a monopoly on British trade with the East Indies.

Pitt’s India Act 1784, aimed to address the financial crisis and administrative corruption that had plagued the East India Company and had become a threat to the British government itself.

The Way Ahead

The act established a new system of governance for the company, known as the “Double Government” system. This effectively gave the British government greater control over the company’s operations in India.

The act also established a system of oversight and accountability for the company, with the creation of a Board of Control in London, which was responsible for the company’s affairs and had the power to veto the decisions of the Governor-General and the Council. Additionally, the Act provided for the appointment of a Secretary of State, who would be responsible for the company’s affairs and would be answerable to the British parliament. The Act also aimed to improve the financial management of the company by requiring it to submit annual reports to the Board of Control and by giving the Board the power to veto any expenditure that it deemed unnecessary or excessive.

Provisions of Pitt’s India Act 1784

The Pitt’s India Act of 1784, also known as the East India Company Act 1784, had several key points:

The act established a new system of governance for the British East India Company, known as the “Double Government” system, which aimed to give the British government greater control over the company’s operations in India. (Double government should not be confused with the Dual government in Bengal)
It created a Governor-General and a Council who were appointed by the Crown and not by the company’s shareholders, this was to prevent corruption. First such Governor General was Warren Hastings.
In 1786, a supplementary act was passed in the British Parliament. By this act Lord Cornwallis (initiator of the Permanent Settlement in Bengal) was made the 2nd Governor General of Bengal who then became the effective ruler of British India working under the Board of Control and the Court of Directors.
It established a system of oversight and accountability for the company, with the creation of a Board of Control in London, which was responsible for the company’s affairs and had the power to veto the decisions of the Governor-General and the Council. This Board of Control was to have 6 government appointed nominees.
It provided for a joint government of British India between the East India Company and the Crown with the Crown holding the ultimate authority.
According to the Pitt’s India act 1784, the Indian possessions of the East India Company would henceforth be called ‘British Possessions’.
The Board of Control would be headed by a President who in effect was the minister for East India Company’s affairs in India.

The Pitt’s India Act 1784 clearly empowered the Board of Control to superintend, direct and control the government of East India Company in India. This in effect meant that the Crown would be controlling the acts and operations relating to civil, military and revenues.

This same President would also be called Secretary of State, (not to be confused with Secretary of State for India, an office that was created in 1858, after the Revolt of 1857) who would be responsible for the company’s affairs and would be answerable to the British parliament.
The act aimed to improve the financial management of the company by requiring it to submit annual reports to the Board of Control and by giving the Board the power to veto any expenditure that it deemed unnecessary or excessive.
The act also aimed to reduce corruption by increasing the transparency and accountability of the company’s operations in India.
The governor general was given more powers regarding war, revenue and diplomacy.
The presidencies of Madras and Bombay were made subordinate to Bengal, depriving them of their independence. Thus in effect Calcutta became the capital of British territories in India and that remained so till 1911 when the capital was shifted to Delhi.
The Governor General’s council was reduced to 3 members so that decisions could be taken by majority. One of the three members would be the ‘Commander in Chief’ of the British armed forces and he would be appointed by the Crown.
It also granted the Board of Control the power to regulate the company’s affairs in India, including the power to veto the decisions of the Governor-General and the Council.
The act was an important step in the process of the British government’s control over the East India Company’s affairs in India, and it laid the foundation for the eventual colonization of the Indian subcontinent by the British Empire.

Benefits of Pitt’s India Act 1784

The Pitt’s India Act 1784 corrected many shortcomings of the Regulating Act 1776 in following ways:

It simplified the division of authority in India
The Governor General’s office was made more powerful which facilitated the decision making process.
By subordinating Bombay and Madras presidencies to Bengal, the Governor General of Bengal became a virtual ruler of India on behalf of the crown.
By reducing the number of councilors to 3 in the Governor General’s council, the question of tie did not arise.
It settled the main lines between the Company’s government and the British government.
The act was skillfully crafted for a compromise between East India Company and the British Government.

Shortcomings of Pitt’s India Act 1784

Despite taking care of the defects of the Regulating Act 1773, this act was not totally devoid of shortcomings which can be seen as:

The boundaries between the British government and the Company’s powers in India were not clear and in many ways personal.
The Governor General was rendered in a dubious situation of serving both – the East India Company and the British Crown.
The boundaries regarding powers, duties and obligations between the Board of Control and the Court of Directors were hazy.
The Governor General being in a far away land had to make some spontaneous and sporadic decisions which many a times were vetoed by the Board of Control.

Conclusion

Pitt’s India Act 1784, aimed to reform the East India Company, which was at that time British government’s main means of administering India. It created a system of dual control which lasted till the end of East India Company’s rule in India in 1858. The Act created a new system of government for the company’s Indian territories, with a Governor-General and Council being appointed to govern British India.

The Act also separated the commercial and political functions of the company, and increased the power of the British government over the company’s operations in India. It was for this act that the British could consolidate their hold on India for the next 150 years. Thus this act provided a long term solution to the British for governance of territories in the Indian subcontinent. Overall, the India Act of 1784 helped to lay the foundation for the British Raj in India, which would last until 1947.