Increased the control of the British Government over the Company and its affairs in India. A Board of Control consisting of six members including two Cabinet Ministers was set up by the British Parliament to look after the civil, military and revenue affairs of the Company.
Besides a secret Committee of Directors was also set up, which would send important orders to India directly.
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This Act laid foundation of a centralized administration, whereby Parliament’s control over the Company was tightened.
In India the number of members in the Governor-General’s Council was reduced from four to three. The reduction in the number of councillors and the provision in the Act for the Governor-General to cast vote, ensured that he could have his will in any matters pertaining to India, if he had even one supporter.
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Moreover, veto power was granted to the Governor-General. This way he had the power not to allow few things to be included in the agenda for discussion by the Council.
The Act also subordinated the Presidency of Madras and Bombay to the Governor-General and the Council of Bengal, in all matters of diplomacy, revenue and war.
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Calcutta was given greater powers in matters of war, revenue, and diplomacy, thus becoming in effect the capital of Company possessions in India.
In administrative matters the control of the British Parliament increased while the authority of the Directors increased over the commercial affairs of the Company.
The Court of Directors could appoint or dismiss British officials in India. The Act also provided for appointment of only covenanted servants to be members of the council of the Governor General, in future.
The Act made the Governor-General supreme over the governors of the other Presidencies and thus it helped in the political unification of India. But the Governor-General now had two masters: the Court of Directors and Board of Control.
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This made the functioning of the Governor-General quite demanding and in fact asked for great diplomatic skill and political wisdom.
Contrary to the constrains under which the Governor-General functioned he had an advantage of working far away from the home.
Ignorance about the actual affairs of home government gave Governor-General an opportunity to act in his discretion even on matters of importance.
Pitt’s India Act (1784) divided authority and responsibility. It introduced what is known as the system of dual control of England over India.
The dual system established by Pitt’s India Act has been subjected to severe criticism. The function of Government and the responsibility were divided between the Board of Control and the Court of Directors and the Governor-General in India and among these authorities it is obvious that unity of any kind can hardly exist.
Pitt, therefore, introduced a new government department, the Board of Control, to supervise the directors of the company.
He also ended an inappropriate division of authority in India by making the Governor-General supreme over the subordinate governments of Bombay and Madras.
The constitutional set up by the Pitt’s India Act did not undergo any major changes during the existence of the Company’s rule in India.
