Regulating Act 1773

A brief introduction
The Enactment of the Regulating Act of 1773 and the Act of Settlement were two major
enactments in the Indian Legal History. The Regulating Act of 1773 was the first Act to bring in
major changes in the administration and justice. then, late on, the Act of Settlement in the year
1781, was enacted to remove the flaws of the earlier passed Act.
The Regulating Act, 1773
Why the need for the enactment of the Regulating Act emerged?
There were many circumstances that made it necessary for the enactment of the act. It was the
first direct interference of the British Government in the regulation of the affairs of the East India
Company.
● Firstly, the concept of the dual form of administration instituted by Robert Clive was
complicated and brought trouble to the people of India. Under this system, the company
had Diwani rights in Bengal and the Nawab had Nizamat rights (judicial and policing
rights). Behind the curtains, Nizamat rights were also in the hands of Company as the
Nawab acted as an agent of the company. This all only laid to the suffering of the people
as they were being exploited by both the Nawabs and the Company.
● Secondly, the plight of the people was when there was a terrible famine in Bengal where a
huge population perished.
● Thirdly, a major reason for the enactment of this Act was the financial crisis that arose in
the company by 1773 and the company had asked for a loan of one million pounds from
the British Government in the year 1772.
● Fourthly, the company through earlier charter had only been given trading rights by the
British Parliament. But, slowly and slowly, as it started acquiring more and more territory it
started acting like a ruling body. And, there in England, the British Parliament couldn’t
swallow this situation. And, to put end to this tendency of company i.e. using the political
powers in the name of trading rights, the company thought it was necessary that these
territories should be brought under the control of Crown.
● At, that time there existed three presidencies of Bengal, Madras, and Bombay in the
country. But, all these three towns were independent of each other and there no
centralized authority in India to control them. Thus, it became necessary to bring
uniformity in the administration of these three towns.
These all circumstances forced the British government to pass the Regulating Act of 1773 in
order to regulate the affairs of British East India Company.

And, accordingly, Lord North(Prime Minister of England at that time) decided to revamp the
affairs of the East India Company with the Regulating Act. And, so in May 1773 Lord North
presented a bill in the British Parliament which when passed was known as ‘Regulating Act of
1773 ‘. An interesting point to note here is that by this act the, British Parliament only ‘regulated’
the affairs of the company but, didn’t take all power completely to itself.

The Aim of the Act

The basic objectives of implementing the Regulating Act of 1773 are listed below.
● To control and regulate the affairs of East India Company
● To remove the political power from the hands of the Trading Company
● To recognize the political and administrative power of the Company
● To provide new administrative reforms which were to provide a Central Administration
System
● To improve the despotic state of affairs (situation) of the company
● To sort out the chaos created by the introduction of the system of dual government
● To bring anti-corruption practices via the medium of the act by prohibiting the servants of
the company, from engaging in any form of private trade and from accepting bribes, gifts,
and presents from the people

Key Provisions of the Act (Major features)

This was the first step taken by the British Parliament to interfere in the administration of the
company, directly. The key features of the have described in the following paragraphs.
● Introduction of the office of the Governor-General of Bengal
The office of the Governor of Bengal was redesignated as the Office of the Governor of the
Presidency of Fort William, also known as Governor-General of Bengal. Lord Warren Hastings
was the first person to hold this designation.
● Creation of Executive Council to Assist the Governor-General
Also, the Executive Council of four members was created to assist the Governor-General.
● Governors of Bombay and Madras presidencies subordinate to the Governor-general of
Bengal
The Governors of Bombay and Madras were made subordinate to the Governor General of
Bengal, thereby making the Governor General of Bengal as the ultimate authority.
● Establishment of the Supreme Court at Judicature at Fort William
In the year 1774, Supreme Court of Judicature at Fort William was established at Calcutta with
one Chief Justice and three other judges. The jurisdiction of this court extended to all areas lying
under the Bombay, Madras and Bengal Presidency. It was a Court of Record and its power
extended to try both Civil, Criminal cases (only over the British subjects not on natives) as well
as it had jurisdiction over admiralty cases. Judges were to come from England. The first Chief
Justice of the court was Sir Elijah Impey.
 ● Reforms to curb corruptions
This act brought prohibition on the servants of the company from engaging in any private trade
or accepting bribes and gift from the local people.
● The directors of the company were to be elected for a period of five years and one-fourth
of them used to retire every year. There was no procedure for re-election available.
The Contribution of the Act to Indian Legal History (Impacts)
1. This enactment is considered to be a landmark enactment as it brought a lot of dynamic
and significant changes in the structure of judiciary in the country.
2. The act brought changes some important changes in the Constitution of Court of
Directors (COD)
3. For the first time, the political and administrative functions of the company were
recognized.
4. This act also laid down the foundation of the Central Administration in the country.
5. This act created for the first time the Supreme Court at Calcutta thereby, making a proper
judicial system and Judiciary got regulated to an extent and for the first time learned
judges from England were made part of the Supreme Court in India.

Drawbacks of the Act

Though the act is considered to be a very significant one in the Indian legal history, still there
was a lacuna left behind as the act failed to resolve the issues prevailing at that time in the legal
system. The major drawbacks of the Act are listed below.
1. The situation was a paradoxical situation for the Governor-General had no veto power and
the Governor-General was made answerable to the Directors and was held responsible for
all the acts related to the administration in India. But, the Governor-General had no free
hand to give an independent decision as he was bound by the decision of the majority
decision of the council. Because of this situation, the council used the Governor-General
as the puppet to make their decision.
2. Though the Governors were subordinate to the GG in actual practice, led to the ultimate
power in the hands of the Governor and his subordinates resulting in widespread
corruption and weakening of the administration at lower levels.
3. There was a lot of confusion regarding the powers and jurisdiction of the Supreme Court.
Also, there was ambiguity between the jurisdiction of the Supreme Court and that of the
Council of the Governor-General.
4. Also, the Act failed to address the concerns of the Indian natives who were the actual
sufferers.
The Act of Settlement
The Act of Settlement was an Amending Act of 1781, which was passed by British Parliament on
5th July 1781 to remove the defects of the Regulating Act 1773. It is also known as Declaratory
Act, 1781.
Circumstances that led to the passing of Act of Settlement
● Though the Regulating Act of 1773, brought a great level of change both in the regulation
of affairs and judiciary, there were some significant loopholes which this act failed to
resolve. Basically, to remove the defects of the Regulating act of 1773, the Act of
Settlement 1781 was enacted.
● Firstly, some serious issues with the administration of the Warren Hastings were there. The
relevant examples of such issues are Patna case, Cosijurah Case and particularly the Nand
Kumar case where (Nand Kumar was hanged). These all issues let to a lot of criticisms of
administration of Warren Hastings.
● Secondly, there was a big tussle between the Supreme Court and Governor-General in
Council which disturbed the balance of administration to a great extent.
● Also, there was interference in the personal laws of the communities which had agitated
the people.
Also, in the year 1777, a complaint was made by the directors of the company against the
Supreme Court as for them it was difficult to run the administration. To address this complaint,
the House of Commons, appointed a committee known as Touchet Committee to a do an inquiry
about the administration of Bengal, Bihar, and Odisha.
The report of this committee led to the enactment of the Act of Settlement of 1781.
The Aim of the Act
The main objectives of the enactment of this Act were :
1. To remove ambiguity regarding the few provisions of the Regulating Act and the Charter
which had created the division between the court and the government.
2. To support the lawful government of Bengal, Bihar, and Orissa, so that revenue could be
collected smoothly.
3. To maintain and protect the laws and customs of the native people.
Key Provisions (features) of the Act
The Act had the following features :
● Change in the powers of the Supreme Court
The servants of the company which earlier came within the jurisdiction of the Supreme Court
were now exempted from the jurisdiction of the Supreme Court.
By the enactment of this Act, the court’s geographical jurisdiction became limited to only
Calcutta.
● Non-interference in Revenue matters
The court now had no jurisdiction in the revenue matters concerning revenue, or any act was
done in the collection thereof, the government now became independent of the control of the
court in the matter of revenue.
● The Shift of Appellate Jurisdiction from Court to the Governor-General and Council
The Appellate jurisdiction shifted in the hands of the Governor-General and Council. Now, the
appeals went from Provincial Courts to the Governor-General in council.
● The Assertion on the application of the personal laws
This act asserted that Mohammedan law should be applied on the Mohammedan cases and
similarly, the Hindu law must be applied to Hindu cases.
Impacts of the Act of the Settlement
The major impacts of this act were :
● The act gave superior authority to the council over the court and favored the council.
● This act made the position of the council very strong so that it could continue to have a
good control over the Indian empire.
● It was the first attempt to separate the executive from the judiciary by defining the
respective areas of jurisdiction.
Still, the Act failed to give a vibrant impact and to remove all the flaws of the Regulating Act of
1773.
Conclusion
These to enactment brought many great changes to the system of administration and justice.it
can also be concluded that the Regulating Act of 1773 laid the foundation of the Central
Administration and Parliamentary Control. But, there were also some drawbacks to both the acts
which can’t be ignored.