Regulating Act 1773 – Provisions, Features, Drawbacks, History

By BYJU'S Exam Prep

Updated on: November 14th, 2023

The Regulating Act 1773 was passed to control the territories of the East India Company majorly in Bengal by the British Parliament. The East India Company was in a severe financial crisis and had taken a loan from the British government in 1772. The British were slowly being influenced by Adam Smith’s free trade and resented the monopolistic control of the Company in trade with India. So when the Company’s finances were strained due to Wellesley’s wars, the parliament thought it to be pertinent to pass the Regulating Act 1773. The territories under British control were the most affected regions. The Regulating Act 1773 brought forth the fundamentals of the Central Administration in India.

The Regulating Act 1773 was established by the British Parliament and Governor General Warren Hastings. The main objective of the Act was to command the territories of the East India Company. It was the first concurrence dictating the powers of the Company. We have facilitated the detailed knowledge centring on the Regulating Act 1773 to assist the aspirants in preparing comprehensively for the IAS exam.

What is Regulating Act 1773?

The Regulating Act of 1773 was brought into action by the British Parliament to regulate the actions of the East India Company, the act also lead to the establishment of the Supreme Court in Calcutta. The main characteristics of the Regulating Act 1773 have been laid here, you can walk through the points mentioned to get ideations about the Act.

Key Highlights of 1773 Regulating Act
Introduced by The British Parliament
Purpose of Regulating Act 1773 To control the territories of the East India Company, mainly in Bengal.

It was the first parliamentary ratification and authorization defining the powers and authority of the East India Company

1773 Regulating Act Governor-General Warren Hastings
Importance of the Regulating Act 1773 The Governors in the Councils at Bombay and Madras were taken under the control of Bengal.

The Supreme Court of Judicature was instituted at Calcutta.

The Governor-General had no veto power.

Territories Affected Territories under British possession in India

History of Regulating Act 1773

The Regulating Act 1773 was passed by the British Parliament, it is also renowned as the East Indian Company Act of 1772. This was a colossal flop as it led the company toward bankruptcy. Later, the Government had to intervene. The East India Company was established in 1600 and initiated trading with the Eastern Countries.

  • Following the Battle of Buxar, the company acquired political power in numerous states such as Bengal, Orissa and Bihar.
  • The expenses of the wars and expanding the boundaries landed the Company in a financial crisis.
  • Lord North presented the Bill to the British Parliament and then it was finally passed in the Parliament later.
  • It was an instrumental step that played an eminent role in taking control of the Indian administration of the Company.

Main Provisions of Regulating Act 1773

The main provisions of the Regulating Act included the change in the post of the Governor of Bengal. After the implementation of the Act the post was called Governor-General of Bengal. Four members of the Administrators were selected by the Governor-General of Bengal. Check here the main provisions of the Regulating Act 1773 as enlisted here-

  • The position of Governor of Bengal surged to Governor-General of Bengal.
  • Warren Hastings could mark his name as the first Governor-General of Bengal.
  • On the advice of the Board of Directors, the British monarchy possessed the power to remove these.
  • A Supreme court was established in Calcutta [now Kolkata]. It comprised four judges in cumulative.
  • The provisions of the Regulating Act 1773 prohibited the military and the civilians to accept or acknowledge any offer of gifts from private firms, businesses etc.
  • The Board of Directors was named term was altered to be of 4 years, and the number of members surged to 24.
  • This Regulating Act surged the authority of the Court of Directors.
  • The British court was mandated to disclose the revenues of India’s civil and military affairs.
  • There was a surge in the pay of the staff of the company under the Regulating Act 1773.

Reasons for Passing Regulating Act 1773

Due to an adverse crisis of finances, that lead to bankruptcy. The Act was passed by the British Government, you can note the reasons for passing the Regulating Act 1773 as listed here.

  • The officials of the company were accused of corruption and nepotism prevalence in the company.
  • There was a Dual form of administration that was introduced by Robert Clive that was subject to a lot of criticism. In accordance with the Dual form, the Company possessed Diwani rights while the Nawabs possessed Nizamat rights. Both were entrusted to the Company.
  • The company’s main objective was to increase revenue, this lead to a surge in the suffering of the farmers and common people.

Salient Features of 1773 Regulating Act

You can check the key highlights and major characteristics of the Regulating Act of 1773 that have been presented in detail. The Regulating Act covered the territories under British control. This Act marked the beginning of the British expansion in India. Take a look at the essential points of this Act.

  • The East India Company was in a drastic crisis of finances and accusations of corruption and nepotism was prevalent against company officials. The Company was heading to bankruptcy, while the servants were flourishing.
  • Succeeding the Battle of Buxar in 1764, the EIC received the Diwani Rights of Bengal, Bihar and Orissa and gradually, it started hindering and interfering in Indian affairs.
  • The Regulating Act 1773 was the foremost step taken by the British Government to monitor and govern the affairs of the East India Company in India.
  • There was a terrible famine and lawlessness in Bengal.
  • The Regulating Act of 1773 recognized the political and administrative functions of the Company and established the fundamentals of central administration in India.
  • The Governor of Bengal was designated as the ‘Governor-General of Bengal’ and established an Executive Council comprising four members for his assistance. The governors of Bombay and Madras were mandated to subordinate the Governor of Bengal.
  • The act led to the establishment and foundation of the Supreme Court at Calcutta (1774) consisting of one chief justice and three other judges. Sir Elijah Impey was the first Chief Justice.
  • The British Government strengthened its control over the EIC by ordering the Court of Directors to report the matters pertaining to the military, revenue, and civil affairs in India to the British authorities.
  • The Regulating Act 1773 also prohibited the servants of the EIC from engaging in any private trade or accepting gifts or bribes from Indians.

Drawbacks of Regulating Act 1773

Mark the drawbacks of the Regulating Act 1773 that has been established here. The aspirants must have an in-depth knowledge of all the parameters of the 1773 Regulating Act, to prepare well for the IAS exam. To eliminate the drawbacks of the Regulating Act of 1773 an Amendment Act was passed in 1781. It illustrated the relationship between the Supreme Court and the Governor General. It was also called the “Declaratory Act of 1771”.

  • The Regulating Act 1773 did not address the grievances and issues of the Indian population who were paying taxes and revenue and could not mitigate corruption amongst the officials of the company.
  • The possession of powers of the Supreme Court was not well-illustrated.
  • As there was no mechanism to investigate the reports sent by the Governor-General in Council, the parliamentary control proved to be ineffective.
  • The Governor-General had no veto power.

Regulating Act 1773 UPSC

The Regulating Act 1773 UPSC notes are necessary to cover the History Syllabus. History has occupied an important place in both UPSC Prelims and Mains GS Paper- 1. To cover Regulating Act 1773, a candidate is mandated to be well-comprehensive with the Indian History Notes, along with the core concepts of the NCERT Books.

The essentiality of the Regulating Act 1773 must be comprehended in a well-planned manner along with the comparison between several other charter acts such as Charter Act 1813, Charter Act 1853, and Morley-Minto Reforms.

Regulating Act 1773 UPSC Questions

The Regulating Act 1773 is an important topic to understand the beginning of British rule in India along with its administration. It recognized the political and administrative functions of the Company and laid the foundations of central administration in India. The aspirants must have an in-depth knowledge of the core concepts and fundamentals to solve the questions in the exam with ease. Solve the questions provided here to enhance the level of preparation and also to uplift the preparation strategy.

Question: Which Act passed by the Parliament of Great Britain had the intention of taking over the administration and management of the rule of East India Company in India? [A] Government of India Act of 1858, [B] Indian Councils Act 1861, [C] Regulating Act 1773, [D] None of these

Answer: (Option C) Regulating Act 1773

Question: Which Act altered the designation of the Governor of Bengal to Governor General of Bengal? [A] Indian Councils Act 1861 [B] Regulating Act 1773, [C] Indian Council Act 1909, [D] Government of India Act 1858.

Answer: (Option B) Regulating Act 1773

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