The circumstances arising out of the maladministration of Bengal compelled the British Parliament to investigate the actions of the East India Company. In this investigation, many cases of abuse of their powers by the higher officials of the company came to light. At that time the company was also going through financial crisis and had also sent an application to the British Government for a loan of one million pounds. The British Parliament found that there is a need to control the activities of the company in India and to fulfill this need, the Regulating Act was passed in 1773 AD.
Read More History: Anti - Rowlatt Satyagraha - General Knowledge of Modern India
This act was the first step taken by the British government for direct intervention in relation to India. The purpose of this act was to take a step towards snatching political power from the hands of the trading company. Some special steps were also taken by this act for the establishment of a new administrative structure.
The President of the Company's Calcutta Factory, called the Governor of Bengal, was made the Governor-General of all the Company's territories in India and two other Governors of Bombay and Madras were subordinated to him. A council of four members was formed to assist him. This act also included a proposal to establish a Supreme Court at Calcutta for judicial administration.
Very soon the shortcomings of the Regulating Act were exposed. There was a constant dispute between the first Governor General Warren Hastings and the members of the council. The Supreme Court was also not able to do its job well as the position was not clear about its relationship with the tribunal and the council. Also it was not clear whether they should follow Indian law or British law.
This court sentenced the former Diwan of Murshidabad and Brahmin by caste, Nand Kumar, to death for forgery, whereas in India no Brahmin could be sentenced to death for this crime. This case created a lot of sensation in Bengal. Even after the implementation of this Act, the control of the British Government over the Company was not clear.
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