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Land Revenue System, Introduction, Features, Types & Impact

Land Revenue System

By severely taxing the populace through a variety of land income systems, the British were able to conquer a vast nation like India. A tax or revenue imposed on land-based agricultural production is known as land revenue. The Indian peasant or ryot was primarily responsible for funding the Company’s commerce and earnings, administrative expenses, and the wars of British colonial conquest in India.

The Indian government has always taken a percentage of agricultural output as land income. It had done so either directly through its servants or indirectly through middlemen like zamindars, revenue farmers, and others who took cultivators’ land revenue and retained a portion of it as a commission.

These middlemen, albeit occasionally landowners, were largely land revenue collectors. We shall examine the British government’s use of land revenue and the Land Revenue System in this article for the UPSC.

Land Revenue Introduction

A tax or revenue imposed on land-based agricultural production is known as Land Revenue. The Indian government has always received a percentage of agricultural output as land income. It has traditionally been an empire’s main source of funding. It is either collected as a percentage of the overall crop or as a monetary value placed on the land that the farmer must pay.

Through middlemen like zamindars, revenue farmers, and others who collected land income from cultivators and kept a piece of it as a commission, it had done so either directly or indirectly. These middlemen were mostly land revenue collectors, albeit they occasionally had some real estate in the area where they were collecting money.

Early EIC administrators operated under the assumption that the business was entitled to the full economic rent, leaving the farmers with merely cultivation costs and wages, which led to the end of agriculture.

Famines were frequent, and large tracts of land were abandoned for farming. It has been shown that having an excessive demand for land income is ineffective. Policymakers in India were driven to experiment with land tenure as a result of this negative situation.

Land Revenue System under British Rule

The Company’s primary objective has been to improve land revenue collection since receiving Diwani rights (the authority to collect taxes on behalf of the Emperor) for Bengal, Bihar, and Orissa in 1765. Land revenue collection has historically been the state’s primary source of income in India.

Until 1813, collecting land revenues was the primary focus of administrative and judicial reforms. The majority of the burden of generating revenue for the Company’s trade and profits, the cost of administration, and the conflicts of British expansion in India fell on the Indian peasant or rabble.

If the British had not aggressively taxed the peasantry, they would not have been able to conquer such a large country as India. By abandoning the traditional revenue management framework, they put into practice policies for collecting revenue. They ignored the effects on farmers and peasants in order to maximize their land profits.

Land Revenue System Features

The British attempted to rely on land tax as the main source of income for the state because the Indian economy was predominately agrarian. The first land income settlement was outlined by Warren Hastings, who presupposed that all land belonged to the sovereign.

He enacted reforms like selling the property at auction to the highest bidder, displacing outdated zamindars/families, and switching the annual settlement to a five-year cycle before returning to the previous pattern. Early East India Company administrators operated under the tenet that the company was entitled to the entirety of the economic rent, leaving only cultivation costs and labour to the cultivators. As a result, agriculture suffered.

Famines were frequent, and vast tracts of land were abandoned for cultivation. It has been established that an excessive desire for land income is ineffective. Policymakers in India were driven to experiment with land tenure as a result of this negative situation.

Land Revenue Policy Types

1. Permanent Settlement

There existed a class of zamindars in Bengal, Bihar, and Odisha before the British arrived in Bengal who collected land taxes on behalf of the Mughal Emperor or his representative, the diwan. After the Battle of Buxar in 1764, the Diwani of Bengal was given to the East India Company. The Company quickly learned, however, that it was impossible to obtain payment from the great majority of farmers in rural areas. They were also ignorant of regional laws and customs.

The Company’s negligence contributed in some way to the devastating Bengal famine of 1770. Warren Hastings then made an effort to put into place various reforms, like the five-year inspections. In this instance, the person who offered the greatest revenue was given the revenue collected through an auction.

Due to the potentially harmful repercussions and ramifications of such a system, Hastings also experimented with annual land settlements. But this did not make things better. On the orders of William Pitt, the British Prime Minister at the time, Lord Cornwallis proposed the Permanent Settlement system in 1786. This was made possible by the Permanent Settlement Act of 1793.

2. Ryotwari System

The Ryotwari System was first presented by Thomas Munro in 1820. This was the main method of collecting land revenue in South India. Major locations where this settlement was first established in British India include Madras, Bombay, and portions of the provinces of Assam and Coorg. The Ryotwari System granted ownership rights to the peasants. Peasants’ taxes were directly collected by the British government.

50% of the Ryotwari System’s earnings came from dry land, while 60% came from irrigated land. Farmers owned the land, but because of high taxation, they were indigent. Additionally, tax rates were often increased.

3. Mahalwari System

The Mahalwari System was first created in 1822 by Holt Mackenzie. Later, the system underwent reforms during the rule of William Bentick (1833). This was the main method of collecting land revenue in North-West India. It was implemented in the Central Province of British India, the North-West Frontier, Agra, Punjab, the Gangetic Valley, and other regions.

Under this method, the land was split into Mahals. A village or more make up each Mahal. The entire hamlet (Mahal) was regarded as a single unit for tax purposes. The village headman or village committee was in charge of collecting taxes. Ownership rights were granted to the peasants. Numerous components from the Ryotwari and Zamindari systems were merged into the Mahalwari system.

4. Taluqdari and Malguzari

Along with the Ryotwari, Mahalwari, and Zamindari Systems, the British also introduced the Taluqdari and Malguzari Systems. Because of this, it is evident that the British levied hefty taxes on the native population to fund their rule.

British land revenue systems caused the land to become a commodity, giving rise to a class of workers known as bonded labourers. Under the British-imposed land revenue regimes, the peasants, who were shackled to their land until death, struggled to make ends meet.

Land Revenue System Impact

The catastrophe had an adverse effect on the entire rural economy. All socioeconomic classes, from zamindars to peasants, were impacted. Due to the loss of their land and right to farm, many people lost their jobs. Farmers had to switch from food crops to cash crops like indigo and cotton to fulfil the high revenue demand, which forced them to purchase food grains at higher prices and sell cash crops at cheaper rates.

Famines were caused by the transition to cash crops and a decrease in the productivity of the land, which had a severe effect on society. As a result, India saw repeated famines that claimed millions of lives. With cash revenue payments, the land settlements developed a market economy. Due to the rise in money lending operations that followed, Indian peasants became indebted, giving money lenders the opportunity to take advantage of them.

In the past, only peasants and zamindars could afford to buy handicrafts. The handicraft industry was also harmed by the loss of peasant income. As artisans shifted to farming, the demand for land increased. The lack of raw materials has a negative impact on the industry.

Land Revenue System UPSC

A new type of private ownership of land emerged as a result of various income settlements, but the cultivators did not reap the rewards of the invention. Instead, it caused the peasantry to become impoverished, which in turn increased rural debt. The zamindar’s enduring claim to the land made land ownership unequal. To safeguard the government’s revenue, the land was made sellable, mortgageable, and alienable. The Indian peasantry was vulnerable to the moneylenders’ and middlemen’s exploitation due to the British land revenue procedures. We will learn everything there is to know about the Land Revenue System and Land Revenue in this article for UPSC Exam Preparation.

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Who introduced land revenue system?

When Sir Thomas Munro was governor of Madras in 1820, he implemented this system of land tax. This was done in the provinces of Assam and Coorg, as well as the Madras and Bombay regions.

What was the land revenue system in British India?

In India, there were three main land tax collection systems. Zamindari, Ryotwari, and Mahalwari were them.

What is land revenue called?

Land revenue is defined as "any sums and payments in money or in kind received or claimable by, or on behalf of, Government from any Person with respect to Land held by, or vested in, Him" 1 [and includes any tax]. 1 cess, charge, or other impost due in accordance with any currently in effect laws.

What was the land revenue system in ancient India?

The ancient Indian land tax system was based on income from the land and so rated according to soil type and production.

What are the three types of land revenue?

In India, there were three main land tax collection systems. Zaminidari, Ryotwari, and Mahalwari were them.

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