Company Reforms by Cornwallis

Lord Charles Cornwallis, who served as the Governor-General of Bengal from 1786 to 1793, introduced a series of far-reaching reforms in the administration of the East India Company’s Indian territories. Collectively known as the Cornwallis Reforms, these measures aimed to curb corruption, improve efficiency, and establish a stable and just system of governance. His policies significantly shaped the foundations of the British administrative, judicial, and revenue systems in colonial India.

Background

By the mid-18th century, the East India Company had transformed from a trading organisation into a territorial power after the Battle of Plassey (1757) and Battle of Buxar (1764). However, company rule was marred by widespread corruption, inefficiency, and exploitation by officials known as “nabobs.”
Following the Regulating Act of 1773 and Pitt’s India Act of 1784, the British Parliament sought to tighten control over the Company’s administration. When Lord Cornwallis was appointed Governor-General, he was tasked with introducing reforms to restore order, integrity, and accountability in governance.

Administrative Reforms

Cornwallis’s foremost contribution was the reorganisation of the civil administration to ensure discipline and reduce corruption among officials.
Key Features:

• Separation of Powers: Cornwallis divided administrative functions into distinct departments—revenue, judicial, and commercial—to prevent concentration of power.
• Civil Service Reforms: He restructured the Company’s civil service to create a professional and loyal bureaucracy.
  • Only Europeans (mostly British) were appointed to senior positions, excluding Indians from higher administrative roles.
  • A system of promotion based on seniority and fixed salaries replaced the earlier system of allowances and commissions, which had encouraged corruption.
  • Cornwallis emphasised discipline, honesty, and meritocracy in official conduct, thereby laying the foundation for what later became the Indian Civil Service (ICS).
• District Administration:
  • Each district was placed under a Collector, who was responsible for revenue collection, maintaining law and order, and administration of justice.
  • Subordinate officials assisted the Collector, ensuring systematic governance at the local level.

These measures brought greater stability and uniformity to the Company’s administrative structure but also reinforced racial exclusivity by excluding Indians from senior posts.

Judicial Reforms

Cornwallis is often regarded as the founder of the modern judicial system in India. His judicial reforms aimed to introduce fairness, uniformity, and separation of executive and judicial functions.
Main Features:

1. Separation of Judiciary from the Executive:
   • Previously, the same officials handled both judicial and revenue matters. Cornwallis separated these functions to ensure impartiality.
2. Reorganisation of Courts:
   • At the district level:
     • The District Judge (a European officer) presided over civil and criminal cases.
     • Munsiffs and Registrars dealt with minor civil cases.
   • At the provincial level:
     • Provincial Courts of Appeal were established at Calcutta, Patna, Dacca, and Murshidabad to hear appeals from district courts.
   • At the apex level:
     • The Sadar Diwani Adalat (Civil Court) and Sadar Nizamat Adalat (Criminal Court) were set up at Calcutta under the supervision of the Governor-General and his Council.
3. Legal Codification:
   • Cornwallis compiled the Cornwallis Code (1793), which provided a comprehensive set of laws covering revenue, civil, criminal, and commercial regulations.
   • Civil cases were to be decided according to personal laws—Hindu law for Hindus and Muslim law for Muslims—while criminal laws were gradually anglicised.
4. Judicial Integrity:
   • Judges were paid fixed salaries to prevent bribery.
   • Strict procedures and documentation were introduced to maintain transparency.

These reforms established a hierarchical judicial system and laid the groundwork for the later British Indian judiciary, though they also marginalised Indian participation in higher courts.

Revenue Reforms

The most enduring of Cornwallis’s reforms was the Permanent Settlement of Bengal (1793), which transformed the Company’s approach to land revenue administration.
Key Features:

• The settlement was introduced in Bengal, Bihar, and Orissa to provide stability in land revenue collection.
• It was an agreement between the East India Company and the Zamindars (landlords), under which:
  • The Zamindars were recognised as hereditary owners of the land.
  • They were required to pay a fixed annual revenue to the Company.
  • The settlement was declared permanent, meaning the revenue demand would not be increased in the future.

Objectives:

• To ensure a steady and predictable source of revenue for the Company.
• To create a loyal class of Zamindars who would support British rule.
• To encourage agricultural investment and productivity through secure property rights.

Outcomes:

• Initially, it stabilised revenue collection, but in the long term, it led to rural exploitation.
• Many Zamindars failed to pay the fixed revenue and lost their lands.
• Peasants (ryots) suffered under high rents and insecurity, as they had no direct rights under the system.

Despite its drawbacks, the Permanent Settlement remained a defining feature of British land policy for decades.

Police Reforms

Cornwallis recognised the inefficiency and corruption of the traditional Indian police system, which relied on local village watchmen and zamindars for law enforcement. He introduced a structured and uniform system to maintain public order.
Main Features:

• Establishment of a Regular Police Force:
  • The old system was replaced with a formal police organisation based on the British model.
  • Each district was divided into thanahs (police stations) under a darogha (police officer), supervised by the district magistrate.
• Centralisation:
  • The police were made responsible to the government rather than local landlords.
  • A hierarchy of control was established for accountability and discipline.
• Objectives:
  • To prevent crime, maintain law and order, and collect intelligence.

This system evolved into the modern Indian police structure, forming the basis of colonial and post-independence policing systems.

Commercial and Financial Reforms

• Cornwallis introduced measures to reduce corruption in the Company’s trade operations.
• He improved accounting and auditing systems to ensure financial transparency.
• Strict rules were established to prevent company officials from engaging in private trade or accepting bribes.
• Salaries of officials were increased to discourage illicit profits.

These reforms restored a degree of financial discipline and credibility to the Company’s administration.

Significance of the Cornwallis Reforms

Cornwallis’s reforms were pivotal in transforming the East India Company’s rule from a loosely managed commercial enterprise into an organised colonial government.
Achievements:

• Introduced the principle of rule of law and administrative uniformity.
• Established a structured civil service based on integrity and discipline.
• Created a judicial framework that provided the basis for the later British legal system in India.
• Reformed revenue administration through the Permanent Settlement.
• Improved law enforcement through a professional police system.

Limitations:

• Exclusion of Indians: High posts were reserved exclusively for Europeans, fostering racial discrimination.
• Permanent Settlement flaws: Led to agrarian distress and rural inequality.
• Rigid bureaucracy: Excessive centralisation limited administrative flexibility.