PERMANENT SETTEMENT IN BENGAL 1793

At the time of his appointment Cornwallis was specially directed to devise a satisfactory solution to the land revenue system in Bengal which should ensure the Company’s interest as well of the cultivators. The fist essential for a satisfactory approach to the problem was a thorough inquiry into the wages, tenures and rents prevalent in Bengal. Prolonged discussion followed in which the leading part was taken by Sir John Shore, the President of the Board of Revenue, Mr. James Grant, the Record Keeper and the Governor General himself. The discussion centered round three vital questions. With whom was the settlement to be made – the zamindars or the actual tillers of the soil? What would be the state’s share in the produce of the land? Should the settlement be for a term of years of permanent?

What was the position of the zamindar? Was he to be considered merely as a hereditary tax gatherer with no priority rights or was he the owner and proprietor of land? On this point John Shore and James Grant held opposite views. John Shore maintained that the zamindar was the owner of the land subject to the payment of annual land revenue to the state. As such the zamindar could bequeath the entire land to his children, sell it or mortgage it. This was the position in the later Mughal times, maintained Shore. James Grant, on the other hand maintained that the state was the owner of all land in the country, the zamindar was just the rent collecting agent and as such could be discarded at the will of the state. Cornwallis, who himself was an English landlord, accepted the viewpoint of Shore. Cornwallis’ viewpoint was very much affected by what was practicable. The company’s servants did not possess sufficient administrative experience to make a direct settlement with the ryot. The system of farming estates to the highest bidder had been tried for long with undesirable consequences. Thus, Cornwallis decided to make a settlement with the zamindars.

What was to be the basis for the revenue settlement?

James Grant maintained that the settlement should be made on the basis of the highest Mughal settlement, namely, that in force in 1765. Shore argued that in the Mughal times there was great discrepancy between the assessed amount and the revenue actually collected and that arrears were very often written off. Ultimately it was decided that the settlement was to be made on the basis of the actual collections of the year 1790-91.

For what period was the settlement to be made?

About this Shore and Cornwallis held different views. Shore held the view that considering the absence of proper survey or demarcation of estate boundaries and limited means of assessment, the settlement should be made for an initial period of 10 years. Cornwallis wanted to declare the settlement permanent and perpetual. He held the view that a 10-year period was too limited to induce any zamindar to clear away the jungles or introduce other permanent improvements in the land. The Court of Directors gave sanction to the view of Cornwallis.

The Settlement – The Zamindars were recognized owners of land and a 10years settlement was made with them in 1790. In 1793 the decennial settlement was declared permanent and the zamindars and their legitimate successors were allowed to hold their estates at that very assessed rate forever. The state demand was fixed at 89% of the rental, leaving 11% with the zamindars as their share for their trouble and responsibility.

Observations on the Settlement – Contemporary opinion claimed a number of advantages for the permanent settlement.

Financially, the permanent settlement secured a fixed and stable income for the state and the state could depend upon that income, monsoons or no monsoons. Further, it saved the government the expenses that had to be spent in making periodical assessments and settlements.

Economically, it was claimed that the Permanent Settlement would encourage agricultural enterprise and prosperity; waste land would be reclaimed and the soil under cultivation would be improved; the zamindars would introduce new methods of cultivation like rotation of crops, use of manure, etc. Thus, the settlement would create conditions for the development of the fullest power of the soil. This in turn would create a contented and resourceful peasantry.

Politically, Cornwallis expected that the Permanent Settlement should create a class of loyal zamindars who would be prepared to defend the company at all costs because their rights were guaranteed by the company. Thus, the permanent settlement secured for the government the political support of an influential class in the same way as the Bank of England had for William III after 1694. The zamindars of Bengal stood loyal during the great rebellion of 1857. Seton Karr commented that the ‘political benefits of the settlement balance its economic defects’.

Socially, the hope was expressed that the zamindars would act as the natural leaders of the ryot and show their public spirit in helping the spread of education and other charitable activities.

Lastly, the permanent settlement of Bengal set free the ablest servants of the Company for judicial services. Further, it avoided the evils normally associated with the temporary settlements, the harassment of the cultivator, the tendency on the part of the cultivator to leave the land to deteriorate towards the end of the term to get a low assessment, etc.

Disadvantages: Whatever little economic or political purposes the Settlement might have served during its first few years, it soon turned into an engine of exploitation and oppression. It created ‘feudalism at the top and serfdom at the bottom’. Many of the advantages claimed proved to be illusory.

Financially, the state has proved to be a great loser in the long run. The advantages of a fixed and stable income were secured at the great sacrifice of any prospective share int eh increase of revenue from land.

Even when new areas of land were brought under cultivation and the rents of the land already under cultivation had been increased manifold, the state could not claim its legitimate share int eh increase. The state demand fixed in 1793 remained almost the same even in 1954.

The Permanent Settlement retarded the economic progress of Bengal. Most of the landlords did not take any interest in the improvement of the land but were merely interested in extracting the maximum possible rent from the ryot. The cultivator, being under the constant fear of ejectment, had no incentive to improve the land. The zamindars did not live on the estates, but away in the cities where they wasted their time and money in luxury. Thus, the zamindars became a sort of ‘distant suction pumps’ sucking the wealth of the rural areas and wasting it in the cities. Besides, a host of intermediaries grew up between the state and the actual cultivator. This process of sub-infeudation sometimes reached ridiculous proportions, there being as many as 50 intermediaries. All the intermediaries looked to their profits and the ryot was reduced to the position of a pauper. In this context it may be worthwhile to quote the view of Carver who wrote: ‘Next to war, famine and pestilence, the worst thing that can happen to a rural community is absentee-landlordism’.

Politically, the permanent settlement did fit in the game of the Company and the Zamindars along with other vested interests became the favorite children of imperialism. However, the British administration gained the loyalty of the few at the cost of the alienation of the masses. Besides, the system divided rural society into two hostile classes, namely, the zamindars and the tenants.

Socially, the Permanent Settlement stands condemned. By recognizing the absolute right of ownership of the zamindars, the company sacrificed the interests of the peasants whether of property or occupancy. In a way the peasants suffered from a double injustice, first by surrendering their property rights and secondly by being entirely left at the mercy of the zamindars who rack-rented them. True, the government attempted rectification and passed tenancy legislation to protect the interests of the ryot, but the zamindars evaded the protective legislation. The growth of population resulting in an excessive pressure on land played into the hands of the zamindars and they not infrequently ejected the ryot. In fact, the peasant was reduced to the position of a serf.

In the beginning the zamindars themselves were in great difficulty. The state demand was pitched very high. Added to this over assessment was the harshness in the method of collection of revenue. The zamindars were required to deposit the revenue in the government treasury by the sunset of the last day fixed for the purpose failing which the lands were confiscated and auctioned. This ‘sunset’ law created great hardships and deprived many zamindars of their land for temporary difficulties. During 1797-98 estates worth 17% of the total revenue of Bengal were sold for non payment of the state demand in time. The ‘sunset’ law created so great insecurity that at one time no bidders were coming forth. The frequent changes in the ownership of land affected adversely the condition of the cultivators.

We might say in conclusion that a temporary settlement for 40 or 50 years, renewable again and again would have secured all the objectives Cornwallis had in view. It was hardly a wise policy measure to bind posterity for all times. If some Indian nationalists like Romesh Dutt gave their unquantified support to the policy of permanent settlement it was partly due to the fact that they themselves came from a class which was the beneficiary from the settlement of Bengal and partly due to the fear that the control of the bureaucracy would be worse than that of the zamindars. In the twentieth century, the economic insufficiency and social injustice of the settlement became very glaring. Besides it was found against the tenets of political or social justice. The Government of Free India has tried to set right the wrong done by Cornwallis. The West Bengal Acquisition of Estates Act, 1955, has abolished zamindari by paying compensation to the zamindars at a huge expense to the public exchequer.