At the Battle of Buxar in 1764 British East India Company won the right to act as diwan, or chief administrative body, in Bengal, India, and to collect taxes on the land. With a total monopoly as both a government and a trading body, it ruled large swathes of territory with millions of inhabitants. Bengal was the Company’s largest and most populous territory in India and its capital, Calcutta, was the richest and most influential city in British India.
In 1772, Warren Hastings began his tenure as Governor of Bengal. Hastings changed the Company’s character from haphazard profiteering to bureaucratic governance with systemized tax collection and administrative organization. He replaced Mughal administrators with Company servants (East India Company employees) and organized a bureaucracy under Company rule. Under the Mughal system, zamindars (land holders) of the Indian princely states paid recurring taxes to their overlords. Hastings created and headed a Committee of Revenue and began increasing the expected sums from zamindari districts. Jurisdiction over zamindars was the major issue fought between the Supreme Council and the Supreme Court and later it brought the court crisis to a head.
Hastings centralized the existing court system, splitting the courts into Diwani Adalats (civil courts), and Faujdari Adalats (criminal courts). While Hastings kept Indian officials as heads of the Faujdari Adalats, putting a faujdar (judge) and diwan (chief public officer) in charge of each, he placed the Company’s provincial councils as heads of the Diwani Adalats. Council members, untrained in law, were required to act as the superintendent (presiding judge) in a monthly rotation. The superintendent theoretically applied the law of the plaintiffs’ religion, with Islamic or Hindu scholars deciding points of law. Above these courts, in theory, were two courts of appeal, the Sadr Diwani Adalat (central civil court) and the Sadr Nizamat Adalat (central criminal court), over which Hastings and his Council presided. Thus the East India Company took over the Mughal system of tax collection and judicial powers using a new theoretical executive and judicial structure.
The reality was different. The provincial councils were hundreds of miles from Calcutta. With little oversight, untrained and overworked council members ran the Adalats as they saw fit. Like the Company, their presence in India was predicated on profit, so frequently they considered their judicial duties a distraction. They rarely held court, and when they did it was often to their own benefit. In one example, the Dacca council sanctioned the use of torture to extract tax collection. In another, the Patna Council blackmailed and extorted a large sum of money from a woman, Bibi Sukun, by claiming she had murdered her bastard child. Although in theory the Sadr Diwani and Sadr Nizamat Adalats would oversee these practices, these Courts of Appeal – over which Hastings and the Council presided – were almost never held. The Sadr Diwani Adalat existed only on paper. Thus misappropriation, extortion, and oppression were the norm. The provincial councils had almost no check upon their power.