Vol. 6 · pages 51–55

36 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES was ever eager to obtain the advantages of the rule of the Company without its disadvantages. It was eager to obtain command of the Indian Empire, but till the end was achieved always looked upon it as problematical and did not want to jeopardize the interests of the country in a project which in spite of its apparent success looked anything but certain of beneficial results. Hence, the Parliament put a strict embargo on the Company’s raising the loans beyond a certain limit lest the Company lose its hold upon India and bring ruin on England by jeopardizing English capital. V INDIA AND THE ACT OF 1858 The East India Company in spite of the fact that she was a source of great prosperity to England suffered great humiliation at the hands of the British Parliament and people. The East India Company was jealous of her monopoly of the Indian trade and the British were determined to derive as large a gain as possible for allowing her that privilege. Every weakness in the administration was made an excuse for extortion and interference : and renewal of charter was often an occasion to disgorge her of her wealth accumulated by the monopoly of Indian trade. Very early in the history of the Company a controversy as to this monopoly of trade had arisen and pros and cons were acrimoniously discussed. Up to 1833 the Company, by means fair or foul, managed to win over the English statesmen to continue her monopoly. But in that year the cry against her monopoly had grown so loud that both the Company and the Ministers had to give in and the East India trade was thrown open to all the English public. By the Act of 1834 the Company ceased to be a commercial corporation. How the obligations of the Company were met may be seen from the following : “The tangible commercial property sold under the Act of 1834, realised £15,223,480 which was thus disposed of :

37ADMINISTRATION AND FINANCE OF THE EAST INDIA COMPANY £8,191,366 towards discharges of India Debt : £2,218,831 was applied in payment of territorial charges in England : £ 1,788,525 was applied in liquidation of part of the Home Bond Debt : £ 2,000,000 was paid into the Bank of England, for investment in the funds, to provide a “Security fund” at compound interest, for the ultimate redemption of the capital stock of the Company (6,000,000) in 1874 : £561,600 was applied in compensations to ship-owners and other persons : and the remainder of £ 463,135 was retained in England, as an available cash balance for the purposes of government in India. The unavailable assets claimed as commercial by the Company—viz. the India House in Leaden Hall Street, one ware-house retained for a military store department, and house property in India, the whole valued at £ 635,445—remains in the hands of the Company but applicable to the uses of the Indian Government.” Though as a trading body the Company disappeared, she continued her existence as a political sovereign of her territories in India. Unfortunately for the Company her days were fast being numbered. It is an error to suppose that the East India Company was abolished because of her inefficiency as manifested in the Mutiny of 1857. On the contrary, before the mutiny had actually taken place, the discussion about the direct assumption of the Government of India by the Crown was set afloat, which is indicative of the fact that mutiny or no mutiny, the British statesmen were impatient to have direct control over the “leaves and the fishes” that came but indirectly from their rule in India by a process of disgorging a corporation which directly fed them on beef fat. This round about process was tiresome and mentally exhausting for impatient minds. Lord Palmerston having been returned by a strong majority in 1857 as a result of his success in the Crimean War immediately notified the Directors of the Company to their great surprise that he proposed to introduce a Bill for the abolition of the Company and the resumption of the direct Government of India by the Crown.

38 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES Unfortunately, the mutiny did occur in 1857 and gave a strong impetus to the abolition movement already in full swing. On the 31st day of December, 1857, the Chairman and the Deputy Chairman of the Company replied to the notification of Palmerston urging that “an intermediate, non-political, and perfectly independent body” similar to the Company was a necessity for the administration of India. Besides this the Company sent a formal petition to both Houses of Parliament. John Stuart Mill who drafted the petition showed the fallacy in the arguments of the mover of the Bill for the abolition of the Company. From the very beginning the Crown had exercized its control over the Indian Government through its Minister presiding over the Board of Control. Between the Government in India and the Crown Minister there was the Court of Directors which the new Bill wanted to do away with. Mill argued that this Court of Directors (the organ of the East India Company), the embodiment of experience was a good guide for the Crown Minister who really controlled the entire administration of India, and said that if evils have really arisen from the mode of administration the remedy that was sought viz. of doing away with the Court of Directors and thus making the Crown Minister an autocrat was worse than the disease. “To believe that the administration of India would have been more from error had it been conducted by a Minister of the Crown without the aid of the Court of Directors, would be to believe that the Minister, with full powers to govern India as he pleased, has governed ill, because he had the assistance of experienced and responsible advisers.” A diversity of opinion prevailed as to the future connection of India with England. The Stanlay Review, an important newspaper in England argued that the East India Company be maintained to keep India away from English politics. It made quite a point of the fact that Englishmen who went over to India became autocrats and that in it there was a danger to democracy. It boldly proclaimed that “India, like a colossal torpedo, will paralyze the beneficient activities and benumb the free moral life of England”...... and if......“brought full in sight of England, will serve her as a great

39ADMINISTRATION AND FINANCE OF THE EAST INDIA COMPANY school, in which she may learn the principles of the King of Naples and the practices of Mrs. Stowe’s Legree.” Others, notably a certain Richard Congreve, a disciple of Conte pleaded that India should be left to work out her own destiny. He maintained that the rule of one people by another is demoralizing and not wise for the better development of humanity. In order to prevent any other nation from stepping into India after the English had left he proposed that an international board be appointed to regulate the administration which was ultimately to devolve upon the Indians when they became capable of self-government. None of these views, however, fall in with those of the British Parliamentarians who decided differently. They were determined to abolish the East India Company and take the government of India immediately-under the Crown : they desired to substitute direct government for the double government. As a result of this neither the petition nor the independent public opinion proved of any effect and Palmerston introduced his Bill for the Abolition of the Company and the future government of India. Before the Bill was passed, the Conspiracy Bill threw out the government of Palmerston which was succeeded by a conservative one under the leadership of Lord Derby. After Lord Palmerston’s Bill had gone out by his overthrow, Benjamin Disraeli, the Chancellor under Lord Derby introduced his India Bill. John Stuart Mill’s comparison of the merits of the two bills is very instructing and later events have borne out his contentions. He says :— “The means which the Bills provide for overcoming these difficulties (of the government of one nation by another) consist of the unchecked power of a minister. There is no difference of moment in this respect between the two Bills. The minister, it is true, is to have a Council. But the most despotic rulers have Councils. The difference between the Council of a despot, and a Council which prevents the ruler from being a despot is, that the one is dependent on him, the other independent; that the one has some power of its own, the other has not. By the first Bill (Lord Palmerston’s Bill) the whole Council is nominated by the minister; by the second (Disraeli’s Bill) one half of it is nominated by him. The functions to be entrusted to it are left, in

40 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES both, with some slight exceptions, to the minister’s own discretion.” Disraeli’s Bill suffered worse fate than the one of Lord Palmerston. It simply fell. A new bill was therefore introduced in August, 1858, and passed designated as an “Act for the better government of India.” The Provision of this Act (of Section 75) which still largely regulate the administration of India may be divided into classes according to their nature : (1) Those dealing with the past affairs. (2) Those dealing with the future affairs. We will first consider those that deal with the past affairs— mainly the settlement of the fiscal and commercial obligations of the Company. Section 42 of this Act “provided that the dividend on the capital stock of the East India Company, should be charged and chargeable upon the revenues of India alone.” Amidst all the questions between India and England that had to be settled with equity none was more prominent than the question of the Indian debt. Who should bear the burden of the Indian debt was the burning question of the time. The crux of the question was who was responsible for it and what was its purpose ? The most enlightening commentary on the problem is that of Major Wingate who immediately after the mutiny argued : “Have the people of India had a voice in the management of their affairs, or have the taxation and expenditure of the Indian Government been regulated with a view to the welfare of India alone, without intervention or interference on the part of the government of this country ? By no means, the Government of India, whether viewed with reference to its forms or powers, has been, from the first hour of its existence up to the present time, the creation of the British Parliament. The power vested in the Government of India to contract debt, was a delegation of authority from the British Parliament, which, up to this hour, as in the case of the last debenture loan, exerts a right of interference over its exercise...... The East India Company have been declared by Parliament to have been simply trustees for the British nation, which, in accordance with this