• Cornwallis realised that the existing system was impoverishing the country, ruining agriculture and was not producing the large and regular surplus that the Company hoped for. Company’s trade also suffered, because of the difficulty in procuring Indian goods for export to Europe. Production of silk or cotton, two of the Company’s major export items, was mainly agro-based
• Was introduced by Lord Cornwallis but it was not his brainchild . Even before  Cornwallis, number of  officials were advocating for tax being permanently fixed eg Alexander Dow in his book History of Hindostan & Pitts India Act of 1784 also laid down directions for Permanent Settlement of land revenue
• Introduced by Cornwallis as decennial (10 years) settlement & made permanent in 1793
• Introduced in Bihar, Bengal , Orissa & some parts of Varanasi & some parts of Madras

• Lord Cornwallis came to India as Governor General in 1786 & land revenue has created many problems . Different English officials were expressing different opinions
• There were two schools

Cornwallis , who himself was English landlord accepted the version of John Shore

Cornwallis also got Instructions from Court of Directors which said that after assessing the records for past years , a settlement should be made with zamindars for some years that could be made permanent in future. Hence, Lord Cornwallis introduced the Permanent Settlement   in 1793

• Security of revenue
• Creating politically reliable landed elite to act  as pillar of colonial rule
• Since it was Permanent Settlement and state would not increase its demand if land under cultivation increased =>  these Zamindars would invest in land to bring more land under cultivation to increase their income.
• To solve bullion issue (Indian revenue would be used for trade instead of bullion from Britain)
• Failure of farming system
• Capital formation: capital would flow from rural to urban areas(which would increase trade )  & agriculture development
• Physiocratic school of thinking that assigned primacy to agriculture in a country’s economy

From minutes of Cornwallis

• The improving landlords would bring the waste lands under cultivation , improve their tenure by better system of embankment & drainage & encourage scientific farming

• Zamindars had several (sometimes as many as 400) villages under them. In Company calculations, the villages within one zamindari formed one revenue estate. The Company fixed the total demand over the entire estate whose revenue the zamindar contracted to pay. The zamindar collected rent from the different villages, paid the revenue to the Company, and retained the difference as his income.
• Zamindars were made landowners & proprietary  rights were given to them . They were not only to act as agents of government collecting revenue but also became owners of land
• Ownership of land was hereditary & transferrable
• Cultivators were reduced to level of mere tenants & use of pasture lands , irrigation lands , fisheries etc were all given to zamindar . Main motive –  zamindars might pay land revenue on time
• Zamindar were expected to improve condition of tenants & agriculture
• State kept no direct contact with peasants
• Zamindars were made proprietors of land & they have to pay give 10/11 of the assessed rental to the colonial state and keep 1/11th of the rental for themselves.
• In case of excess rental due to extension of farming or greater extraction, zamindar could keep entire increased amount
• In 1794, Sales Law/ Sunset Law was introduced under which Zamindari rights would be auctioned in event of failure to pay revenue
• Regulation of 1799 & 1812 – Zamindar was given right to seize property of tenant in case of non payment of rent (the permanent assessment was the largest sum that could be got from the land. It was a heavy and oppressive assessment.  Such oppressive taxes could only be collected by oppressive methods. If the zamindars were not allowed to oppress the peasants then they would not be able to meet the demands of the State)
• Initial fixation of revenue was made arbitrarily & without consultation with zamindars . Attempt was to secure maximum amount as a result rates of revenue were fixed very high

• Initially, Zamindars were to give 10/11 of the assessed rental to the colonial state and keep 1/11th of the rental for themselves. However, the sums to be paid by them as land-revenue were fixed in perpetuity. If the rental of a Zamindar’s estate increased due to the expansion of cultivable area or rise in agricultural productivity or simply due to his capacity to extract more from the tenants, he was entitled to keep the entire amount of the increase. This would constitute loss to income of East India Company / State
• As a result of this settlement, most of the tenants including the pre-existing Khud-khast tenants enjoying occupancy rights in their lands were reduced to the status of mere tenants-at-will of the Zamindars who could easily evict them and enhance their rents.
• No margin was left for shortfalls due to flood, drought or other calamity. As a result, many zamindars had their zamindaris taken away and sold in the decades immediately after the Permanent Settlement. In Bengal alone, it is estimated that 68 per cent of the zamindari land was sold between 1794 and 1819.
• Village based zamindars were replaced by rich people from Calcutta who went on buying spree of agricultural estates of old zamindars who fell prey to Sunset Law
• There is a view that this is the reason why Bengali people didn’t invest in industry because they found investing in land more profitable
• Process of Sub-infeudation started – Finding it difficult to pay amount, Raja of Burdwan(others followed too)   divided most of his estate into ‘lots’  called Patni Taluqs. Each such unit was permanently rented to a holder called a Patnidar, who promised to pay a fixed rent. If he did not pay, his Patni could be taken away and sold.

• Secured fixed & stable income for the state
• Expenses of frequent assessment of lands were saved
• Made a class of Indians who were loyal to British empire & their existence depended on continuance of British empire
• Before settlement East India Company was required to maintain big establishment of collectors which weren’t required now
• Judicial services improved because Permanent Settlement set free ablest servants of Company for judicial services
• Value of land increased because zamindars devoted their attention towards improvement of soil & many wasteland & forests were converted into cultivable land
• Britishers envisaged that it would be helpful in spreading education as zamindars would act as natural leaders & show public spirit in spreading education & charitable work

• Permanent Settlement was  a great blunder & it affected adversely the interests of East India Company , zamindars & worst of all that of Peasants
• System overlooked interests of peasants
• • • • They were not owners of land
      • Could be expelled from land
      • Couldn’t appeal anyone against rise in taxes
      • Rights over pastures ,forests & canals were abolished as well
      • In 1799 : Zamindars were given right to court & zamindar could also take away their property even if peasant was not able to pay tax due to calamity

• Created feudalism at top & serfdom at bottom
• No improvement in agriculture happened . Most of the landowners didn’t take any interest in improvement of land but were merely interested in maximum possible extraction of the rent.
• Politically although class loyal to them was created but East India Company alienated masses to gain loyalty of few
• Disadvantageous for Company as although Company’s expenses were increasing, revenue remained same & they lost contact with peasants

• There wasn’t sizeable Zamindar class in Madras as in Bengal . Still between 1801 to 1807 Permanent Settlement was introduced by recognising Poligars as local zamindars & where poligars were not found , villages were aggregated into estates & sold to highest bidder
• Scottish enlightenment – They insisted on primacy of agriculture & celebrated importance of farmers within agricultural societies . Thomas Munro & Elphinstone were Scots
• Nature of Permanency in Permanent Settlement : After 1810, agricultural prices rose, increasing the value of harvest produce, and enlarging the income of the Bengal zamindars. Since the revenue demand was fixed under the Permanent Settlement, the colonial state could not claim any share of this enhanced income. Keen on expanding its financial resources, the colonial government had to think of ways to maximise its land revenue. So in territories annexed in the nineteenth century, temporary revenue settlements were made.
• David Ricardo’s theory began to influence .  It says that – Rent was surplus from land ie Income – (minus) cost of production – (minus) labour & state has legitimate claim over that at expense of unproductive intermediaries . This  argument was used to eliminate zamindars
• Most important cause was Financial pressure due to wars   – financial crisis of Madras Presidency worsened by rising expenses of wars .

• Started by Alexander Reed in Baramahal in 1792 & continued by Thomas Munro from 1801. But after 1807, System was almost abandoned with departure of Munro back home.

• 1820 : Munro returned &   he argued
• • • • Ryotwari was ancient land tenure system & best suited to Indian conditions
      • Security & administration of empire need elimination of overmighty poligars & zamindars
      • Historically land in India was owned by state which collected revenue from individual peasants through hierarchy of officials . When military power of state declined , these poligars appropriated land & usurped sovereignty . Hence, there is need to reverse it now

• Its adoption was due  to one main reason – it resulted in a larger revenue than any other system could have produced. This was because there were no zamindars or other intermediaries who received any part of the agricultural surplus – whatever could be squeezed from the cultivator went directly to the State. The Madras government was chronically short of funds, and such a system would naturally appeal to it.

• In Bombay : Introduced by Elphinstone in 1819 after defeat of Marathas . There was no large Zamindars here too

• Instead of collecting from the zamindars, they began to collect directly from the villages, fixing the amount that each village had to pay. After this they proceeded to assess each cultivator or ryot separately – and thus evolved what came to be known as the ‘Ryotwari’ system.

• Revenue was assessed for each cultivator or ryot separately
• It created individual property right in the land & it was vested in peasants rather than in zamindars .
• It was a temporary settlement & was to be revised periodically (20 years )

Rate

But in order to be attractive & equitable , it required detailed land survey, quality of land , area of the land, average produce of every piece of land had to be assessed but in practice these estimates were often guessworks & hence revenue demand often was very high .

• Peasants soon discovered that large number of zamindars were replaced by one giant zamindar ie Colonial state
• Raised revenue income of government but put cultivators in great distress . In many areas no survey was carried out & tax of a ryot was assessed on an arbitrary basis based on village accounts
• Revenue to be  paid by ryot was fixed on entire farm & not on each field which might have varying irrigation facilities & hence different levels of productivity
• Contrary to Munro’s insistence that cultivator would be given freedom to take as much or as little land as he choose , this provision was dropped in 1833 . Government  officers began to compel the cultivators to hold on to (and of course, pay for) land that they did not really want to cultivate. Since cultivation was not voluntary, it was always difficult to collect the revenue, and so the use of beating and torture to enforce payment was also widespread. These methods were exposed by the Madras Torture Commission in 1854. After this certain reforms were introduced. A scientific survey of the land was undertaken, the real burden of tax declined, and there was no need to use violent and coercive methods to collect revenue.
• Even  Ryotwari system didn’t eliminate village elites as intermediaries between government & peasantry . Privileged rents & rights of the Mirasidars were recognised & Mirasidars were pivotal to  British ideal of sedentary agricultural community .

Historians differ on the impact of Ryotwari