Unit 1 – British

Paramountcy in India
1. Decline of Mughals & Arrival of British East
India Company
1.1. Decline of The Mughals – 18th century debate
The early historians of Mughal India viewed the events of the 18 th
century as being integral to political developments in the Mughal
empire. The early historiography of decline focused on the
administrative & religious policies of individual rulers & their nobles.
Both the British administrators & scholars and the Indian nationalist
historians of the late 19th & 20th centuries assessed the empire in terms
of the character of the ruling elites.
In the works of Sir Jadunath Sarkar, the spotlight remained on
Aurangzeb, the emperor who oversaw the imperial downfall. His
religious policy in particular & later his Deccan campaigns were
identified as the chief factors. These referents continued to provide
explanations for the subsequent decline of Mughal economy,
institutions, & society. Sir Jadunath Sarkar characterized the peasant
rebellions that ultimately destroyed Mughal political stability, as a
Hindu reaction to Aurangzeb’s Muslim orthodoxy. The religious policy of
the rulers constituted the chief explanatory point in the subsequent
Mughal studies of Shriram Sharma & Ishwari Prasad as well. The 18 th
century emerged as a politically chaotic & economically crisis prone
period.
From the late 1950’s, Marxist oriented historians began to provide
explanation of Mughal decline in material terms. Satish Chandra held
that the structural flaws in the working of the Mughal institutions of
Jagir (territory over which have control) & Mansab (rank or position in a
hierarchy) responsible for the fiscal crisis of the late 17 th century. He
argued that the efficient functioning of these 2 institutions depended
on the availability of the revenue & its collection & distribution. The
Mughal failure to ensure the smooth functioning of these institutions
became most pronounced during Aurangzeb’s reign & was to herald
the process of imperial collapse. This is because these institutions form
the backbone of the Mughal empire.
From 1960’s onwards some economic historians, in particular Irfan
Habib, explained Mughal decline & the consequent political & social
unrest in fiscal terms. Habib argued that the high rate of land revenue
demanded by Delhi caused large scale rural exploitation, leading to
peasant migration & rebellion. This created an agrarian crisis that
resulted in the weakening of empire’s political might. Athar M. Ali
accepted Habib’s model of fiscally centralized state but attributed its
decline not so much to the high land revenue demand but rather to a
shortage of jagirs. According to him the deficit was created due to the
political expansion of the empire into less fertile lands, especially in the
deccan. This problem is called ‘Bejagiri’. This increased the number of
nobles without a corresponding augmentation in Jagir lands. The
shortage of Jagir’s generated an administrative problem which in its
turn fueled the economic crisis. However, John F. Richard’s study of the
Mughal administration in Deccan challenged the idea that there was a
shortage of usable Jagir’s in the region. His conclusion that the Deccan
wasn’t a deficit area questioned the belief that ‘Bejagiri’ (the absence
of Jagir’s) was a major cause of the crisis of empire.
In the 1980’s the later works of Satish Chandra once again shifted the
focus to the economic aspects of the politico-administrative imperial
crisis. He argued that as Jagir’s became few & relatively infertile, the
discrepancy between the estimated revenue (Jama) & actual yield
(Hasil) intensified. This had an adverse impact on the ability of state
functionaries to ensure the regularity of revenue collection. A Jagirdari
crisis with distinct economic undertones finally created problems in
Mughal stability.
The downfall of the empire is also viewed as a cultural failure. Culture
is seen in terms of technological, intellectual, & economic
referents/context. Here, the economic crisis that underlined the decline
is attributed to the relative economic, technological, & intellectual rise
of Europe in the period between 1500’s to 1700’s as a center of world
commerce. As Europe emerged as the principal market for luxurious
crafts manufacturers of the world, it attracted high value products from
the traditional eastern markets. This increased the cost of luxury items
in India & intensified the financial difficulties of the ruling classes. This
was compensated through intensified agrarian exploitation. This is
Athar M. Ali’s concept.
In addition, the intellectual & technological aridity of India did not allow
towns to emerge as safety valves for the people. There was therefore
no escape from the fiscal arm of the state. All these reasons made the
empire politically & economically vulnerable. The follies of imperial
policy, threw the empire out of gear & paved the way for its eventual
demise.

All these scholars projected the 18 th century as a dark age, its hallmark
being political chaos & economic decline. The fixing of the historians’
gaze on the imperial center alone took no cognizance of the diverse
ways in which Mughal institutions were being modified & transformed
at local & regional levels, so as to pave the way for a subtle shift of
power away from Delhi to the regions. This historiography saw the
emergence of regional outfits such as the Marathas, the Satnami’s, &
the Sikhs also as a consequence of the support extended by the
exploited peasantry to the Maratha zamindars, to peasant leaders such
as Banda Bahadur, or to religious sects such as the Satnami’s, all of
whom peppered their rhetoric of political mobilization with the
monotheistic bhakti ideology of social equality.
Alongside there also existed alternate views of the 18 th century political
economy. These moved beyond Mughal agrarian system & the
machinery of revenue extraction to other kinds of non-economic
production & politico-economic engineering by Mughal functionaries.
These kinds of views can be traced in the works of Hermann Goetz on
18th century music & architecture and Bernard S. Cohn’s study of
Banaras. Goetz documented the resilience of Mughal society as
reflected in the evolving musical & architectural style in the wake of
imperial collapse. Bernard Cohn on the other hand pieced together the
efforts of Mughal functionaries such as zamindars & amildars to
manipulate both the imperial & regional level power structures so as to
carve out independent niche for themselves.
It was on these carefully crafted administrative and fiscal networks that
English rule later structured itself. Both these studies, though different
in their objectives, offer similar suggestive implications for
understanding both the Imperial collapse as well as the emergence of
regional powers. They indicate the continued survival and growth of
social and economic referents of the Empire. Even when the edifice of
its revenue extension structure has collapsed, architecture, music,
fiscal institutions, and social groups emerged as the new fulcrums of
regional state buildings. Such studies also provoke a reconsideration of
the centralized nature of Mughal governance. It is difficult to conceive
of a centralized bureaucratic state model where economic and social
markers of growth outlive political decay.
J. C. Heesterman, in his work, argues for the resilience and durability of
Mughal society by explaining the overarching Indian political forms
through the self-explanatory organic scheme of the rise, decline, and
fall that characterized power in Hindu political theory. Thus, according
to Heesterman, the Mughal Empire did not fall, rather it was simply
swallowed by a larger political organism, so a cyclical re-alignment
rather than a collapse characterized the change in the 18th century.
But, Heesterman stands alone in his explanation of 18th century
society with his emphasis on the inevitability of change that derives
from the dilemma within the Indian notion of kingship.
Scholars who produced regional studies were not convinced by
Heesterman’s somewhat meta-physical argument. In contrast, they
emphasized a range of factors that fueled imperial decline &
encouraged regional, economic & political growth. The emphasis was
on different non-agricultural strands that sustained the local
economies.
Ashin Das Gupta indicates that corporate mercantile institutions
transcended political boundaries for over seeing the transportation of
goods & the provision of credit & insurance services in the period of
decline. Even though inland trade increased, export trade & port cities
suffered relative eclipse in the face of European advances. The port city
of Surat in Gujarat declined around 1720 as did Masulipatnam in
Madras, & Dhaka in Bangladesh. Whereas colonial port cities such as
Bombay, Madras & Calcutta rose to prominence.
B.R. Grover maps a general picture of rural commerce in 18 th century
north India. He concludes that the change caused by foreign invasions,
European & English competition in trade, & the ruination of Mughal
nobility & aristocracy, local rural commercial production found new
avenues in the provincial markets within the subcontinent. This greatly
compensated for the comparative lust of foreign trade with respect to
handicraft & cottage industries. Because foreign exports from India to
England were highly taxed, while exports from England to India were
not taxed at all, so Indian industries ruination was prevented slightly by
internal trade going on at the local level.
According to Karen Leonard, the movement of mercantile from Delhi to
regional centers were critical to buoyancy of the regional centers’
political economy & the relative decline of Delhi. The shift of credit and
trade of the great banking firms to the regional centers was
accompanied by the emergence of a mobile service class with multiple
functions like trade, accounting as well as revenue collection.
Chetan Singh suggests that the political unrest in some provinces such
as the Punjab, was linked to tensions generated between the agrarian
economy of the Mughal Plains, on the one hand, and fringe tribal
societies as they moved towards a sedentary existence, on the other.
The process of tribal societies being sedentary altered the structure of
tribal societies and the increased pressure on the agrarian economy,
which was already under stress. Thus, the events of the eighteenth
century were rooted in the economic processes that shaped the
functioning of empire from its very inception.
The much neglected cultural dimension of both the empire’s
functioning as well as its eventual demise is also now central to the
field of 18th century studies. Central to discussion’s is the cultural
interface between regions & the empire. In this context, John F.
Richards & V. Narayan Rao emphasized the need to juxtapose Persian
with vernacular source material, & oral with written tradition, to
understand the complexity of Mughal functioning at the lowest level.
J.F. Richards, V. Narayan Rao & Muzaffar Alam suggest that evidence of
resistance of Mughal rule may not be available in the Persian material,
but may lie instead in vernacular texts & oral traditions generated in
the regions.
The linguistic component of this critical cultural interface between
regions & empire is elaborated upon by Muzaffar Alam in a recent
essay on the making of Persian as the imperial language, he shows
that the tensions between region & empire were also expressed as
friction between Persian & vernacular. Yet Persian documentation
alone, both court chronicles & revenue records continue to constitute
the research base of those who postulate a centralized fiscal state
model. The evidence from most of the regions indicate economic
realignment that ensured the dissociation of the regions from imperial
control. These studies considerably alter the notion of the 18 th century
as a dark age.
At the same time, these new studies also indicate that trajectories of
regional disassociations form the center were diverse, even though
some general features can be identified across the board. The common
attributes are articulated most clearly in the study of C.A. Bayly. His
book, “Rulers, Townsmen & Bazaar”, suggest that regional-political
crystallization was a consequence of 3 important developments.
1. The emergence of a vibrant cross-caste mercantile organization &
its involvement in politics. The proliferation of the Mughal practice
of revenue farming (ijaradari system) meant a coalescing of
merchant & agrarian interests.
2. The gentrification process which brought together a class of
scribes, accountants & other Mughal service groups that served
the new powers locally & sank their feet deep into society,
investing in the small towns & kasbas.
3. The practice of military fiscalism which meant the maintenance of
large armies & their deployment in revenue collection.
The emphasis in Bayly’s work is on the rise of intermediaries complete
with the trappings of royal power, drawing on the Mughal military &
fiscal institutions and their emergence as new power centers.
2. Early Charters
1453 – watershed moment - arrival of ottoman empire- biggest impetus
to search for alternate routes to trade with east
Other factors – mercantilism (increase exports & minimize imports),
spread of Christianity, development of cartography & advanced ship
building, state sponsored expeditions for example henry the navigator
(esp. by Spain & Portugal to look for alternate ways not monopolized by
Italian city states like Florence, Milan, Rome, Naples etc.), myth of El
Derado, renaissance’s impact – rationality & humanism which led to
decline of feudalism (closed economy) & 3 G’s i.e. gold, glory & god.
Diaz found the southernmost tip of south Africa & named it cape of good
hope, which greatly helped other travelers in reaching India. First to
arrive were the Portuguese.
31st Dec – charter of 1600 – led to est. of EIC, originally named as
Governor and company of merchants of London trading to East Indie’s.

Charter of 1600
 On 31st of December, 1600, Queen Elizabeth I granted charter to the
company which incorporated the London East India Company to trade
into the East Indies and also the countries & parts of Asia & Africa for a
period of 15 years subject to a power of determination of 2 years
notice if trade was found unprofitable. The name of the company was
‘The governor & company of merchants trading into the East Indies’.
Thus, the company became a legal entity with exclusive privilege of
trade with the East Indies.
 The same charter further granted legislative power to the company to
make laws & ordinances etc. for the good governance of company & its
servants and to punish offences against them by fine or imprisonment
according to the laws & customs of the realm.
 15 years were given to this company for trade. The company was given
full monopoly & if any person starts trade without prior permission of
the company as well as the Queen, will be punished with fine,
imprisonment, forfeiture of ship & goods or same punishment as Queen
so thinks fit.
 The company was permitted to make general laws. It was the first time
where any non-governmental body was authorized to make laws. The
company was allowed by this charter that it could give simple
imprisonment & fine & physical punishment in order to maintain the
law & order of the company.
o But the company was prohibited to make laws on following cases-
murder, treason, dacoity. And the laws must not be unjustifiable &
unreasonable laws.
o The company could not make laws which were inconsistent with
the parliamentary laws & the customs.
 Limitations of the charter:
o The legislative powers conferred on the company was very
limited.
o Serious crimes could not be adequately dealt with.
o There was no power with the company to govern any territory.
 Despite its limited scope, the early grant of legislative powers to the
company was of historic interest because it is out of this modest
beginning in the year 1600 that the vast powers of legislations grew in
course of time.
 The affairs of the company were to be conducted on democratic lines.
 The mercantile successes of some of the European powers in the 15 th &
16th centuries inspired a group of merchants of London to form a
company to trade with the East, it was called the London East India
Company. On Dec 31st, 1600, Queen Elizabeth I granted them a charter
empowering the governor & the company to make reasonable laws for
the good government of the company & for the better advancement &
continuance of the trade & to provide such pains & penalties by
imprisonment or fine as might seem to them necessary. The laws &
penalties were to be reasonable and not to be repugnant to the laws,
statutes & customs of England.

Charter of 1609
 James I renewed the same powers by his charter, granted in 1609. It
was with these powers & limitations that the English traders came to
India & set up a factory at Surat.
 In 1612, Captain Best secured from the Mughal emperor an imperial
decree granting permission to the English to trade there on payment of
customs duty.
 The company secured its next territorial foothold in 1639 at Madras
when Francis Day built Fort St. George.
 In 1662, Bombay was given by Portugal to Charles II as part of the
dowry of Catherine De Braganza of Portugal. The king turned it over to
the company.
 The third leg of the tripod on which England built up her system of
administration in India was obtained in 1669 when Job Charnock & his
followers established a permanent settlement in Calcutta.
 But the personal character of the law of India & the nature of many of
its principles & penalties made it impossible for men of a different
culture & habits of thought to adopt the treaty between Capt. Best &
the Mughal governor.
 In 1615, Sir Thomas Roe managed to secure from the Mughal emperor
Jahangir certain facilities for the English, including the right to be
governed by their own laws & to have disputes settled by their own
tribunals.
 But disputes between an Englishman on one hand and a Muslim or
Hindu on the other, were to be settled by established local authorities.
 European Christians have usually been allowed by the indulgence or
weakness of the rulers of those countries to retain the use of their own
laws & their factories have for many purposes been treated as part of
the territory of the sovereign from whose dominions they come. Thus,
though the English factories were part of the dominion of the Mughal
emperor, their own law was administered in the settlements. It was at
least administered according to the current English notions of justice &
fair play.

Dual system of government

 In 1765, the company obtained from the Mughal emperor the grant of
Diwani over Bengal. This was the right to administer the revenue of
Bengal which carried with it the duty of administering civil justice while
the Nizamat or the right to administer criminal justice remained with
Naib Nasim, a minister of Nawab. In practice, the inconvenience of
separating these powers proved so grave that the company
encroached upon and ultimately usurped the power to administer
criminal justice.
 In these circumstances, it became necessary even before the company
could claim dominion over any part of India, that the crown should
grant to them certain legislative & judicial powers to be exercised by
them over the English servants of the company & such Indian settlers
as placed themselves under their protection.

 For each voyage, the crown used to grant the general or commander of
the fleet the right to inflict punishment for capital offences & to enforce
martial law. The royal grant of 14 th December, 1615 provided that in
cases involving capital offences, a verdict must be found by a jury.

 James I, on February 4th, 1623 empowered the east India company to

issue commissions to any of its presidents and his council to punish &
correct all & every subject of the company or their heirs employed by
the East India company.
 The death penalty could only be inflicted for mutiny, after trial by a jury
of 12 or more Englishmen.
 In spite of this grant of power, the company in 1624 applied to the king
for authority to punish their servants abroad by marital law as well as
by municipal law.
 By charter granted in 1661, Charles II empowered the governor &
council of each factory to judge all persons belonging to the said
government & company, or that should live under them in all causes
whether civil or criminal according to the law of the kingdom & to
execute judgment accordingly. This general provision placed judicial
power in the hands of the executive & restricted the law to be
administered to that in force in England.
 According to G. Rankin, the first provision for the exercise of judicial
powers by the East India company was made by the charter of Charles
II, and its responsibility for the administration of law in India was
confined until 1765 to the factories of the company & their branches.
 The provision of charter of 1661 were interpreted as applicable only to
the European servants of the company. The English crown at this time
clearly had no jurisdiction over native subjects of Mughals & the
charter was admitted to apply to the European servants of the
company.
 The charter of 1661, issued by Charles II increased the authority of the
company. By the charter of 1661, the company was empowered to
appoint governor & council to decide civil & criminal cases of all
persons of the company. The governor & his council were given general
judicial authority to judge all persons belonging to the said government
& company or, that shall live under them, in all cases whether civil or
criminal according to the law of this kingdom & to execute judgement
accordingly.
 The right to administration was one of the main feature of charter of
1661. The charter empowered the company to administrate over the
fort, colonies & cities. If it is expedient to maintain the administration,
it could indulge in the war with Indian local kings & could make peace
treaties.
3. System of Dual Government of Robert Clive
Battle of buxar created an atmosphere, where company was forced. Though won over the Mughal emperor, only
demanded the Diwani rights over Bengal since its difficult to control the entire territory over a population where they
are a minority.

British merchants were given Dastaks which was a pass that gave them concessions when trading in their territories.
This was misused by company officers, who used it for conducting personal businesses as well outside of company
affairs.

Diwani rights entailed right to collect revenue. Nizamat means administration which was not claimed by the
company.
4. Zamindari system of Cornwallis
5. Subsidiary alliance of Wellesley
6. Doctrine of Lapse of Dalhousie
7. Drain of Wealth Theory of Dadabhai Naoroji