It was the first step taken by the British Government to control and regulate the affairs of the EIC in India. First time, British government recognized the political and administrative functions of the EIC. British government laid the foundations of central administration in India.
The Act designated the Governor of Bengal as the ‘Governor-General of Bengal’ and created an Executive Council of four members to assist him. Governor of Bengal was made ‘Governor-General of Bengal’ and governors of Bombay and Madras presidencies were made his subordinates.
Act prohibited servants of EIC from engaging in any private trade or accepting bribes and gifts from native. Real objective was to control and manage corrupt East India Company. The Act told the governing body of the Company i.e. Court of Directors to report all its affairs (revenue, civil, military etc) to British Government.
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