- The Regulating act of 1773 permitted the Company to retain its former possessions and power in India but the management was brought under control by the British Government.
- Election for Directors: The directors of the company were elected for four years. One- fourth of them retire for every year and the retiring Directors were not entitled to be elected again.
- In order to assert parliament’s control over the company, the directors were required to place regularly all their correspondence, regarding civil military affairs with the Indian authorities, before the secretary of the state in England. All correspondence regarding to revenues in India was required to be placed before the Treasury in England.
- The Act limited Company dividends to 6% until it repaid a GB £1.5 Million loan and restricted the Court of Directors to four-year terms.
- It prohibited the servants of company from engaging in any private trade or accepting presents or bribes from the natives to curb corruption.
- First Governor General of India: The Act elevated Governor of Bengal, Warren Hastings to Governor-General of Bengal and subsumed the presidencies of Madras and Bombay under Bengal’s control. Now, no other presidency could give orders for commencing hostilities with the Indian Princes, declare a war or negotiate a treaty. Now, the Governor General of India and his council of 4 members got a legal status. Their term of office was five years and the king was empowered to dethrone them even earlier recommendation of the court of directors.
[Commonly we call Warren Hastings as First Governor General of India. But the official title of Warren Hastings was the Governor of the Presidency of Fort William. This office became Governor General of India in 1833 from the times of Lord William Bentinck and in 1858, when India was taken over by England; it remained Viceroy and Governor-General of India till 1947]
- Council of Four: The Act named four additional men (as explained in previous paragraph) to serve with the Governor-General on the Supreme Council of Bengal: Lt-Gen John Clavering, George Monson, Richard Barwell, and Philip Francis. Barwell was the only one with previous experience in India. These councillors were commonly known as the “Council of Four“.
- The governor general in council was given all the power to govern the company’s territorial acquisition in India, to administer the revenue of Bangal, Bihar, Orissa and to supervise and control the general civil and military government of the Presidency. The presidencies of Bombay and Madras were placed under the control and superintendence of the Governor General in Council while exercising their power to make war and peace. The Governor General and the Council were to keep the court of directors fully informed of all their activities affecting the interests of the company and they were also to work in entire obedience to the orders and instructions of the court of directors.
- India’s First Supreme Court: A supreme court was established at Fort William at Calcutta. British judges were to be sent to India to administer the British legal system that was used there. This Supreme Court consisted a Chief Justice and three other regular judges or Puisne Judges, being barristers of not less than five years standing and to be appointed by His Majesty. Sir Elijah Imphey was the first Chief Justice. The Supreme Court was the supreme judiciary over all British subjects including the provinces of Bengal, Bihar and Orissa.