The Sun.
London, England, 1833-06-10 00:00:00

LETTER FROM THE CHAIRMAN AND DEPUTY CHAIRMAN

TO THE RIGHT HUN. CHARLES GRANT.

East India House, May 29, 1833.
Sir,—We have had the honour to receive, and to lay before
the Court of Directors of the East India Company, your letter
dated the 27th instant, communicating the sentiments of his
Majesty's Ministers upon the points embraced in the resolution
regarding the Company's Charter, which was passed by the
General Court of Proprietors on the 3d of this mouth.

The Court of Directors acknowledge with much satisfaction
the several modifications of the plan of Government which your
letter announces, and they are persuaded that their constitu-
ents, equally with themselves, will appreciate the spirit of
frankness and conciliation in which those modifications have
been conceded.

There now remain two points upon which the view taken by
the General Court differs from that of Ministers: the amount of
the Guarantee Fund, and the expediency of authorizing publi.
city being given, in certain cases, to the proceedings of the
Board and the Court.

We must candidly state to you, that both of the. e points

were deemed by the General Court to be of vital consequence,
and that the concurrence in the basis of the scheme which is
implied in their late resolution, appeared to be mainly depen.
dent on the Guarantee Fund being extended as far as that re.
solution contemplates, and on such a measure of publicity
being sanctioned as is necessary to insure good government.
We are, of course, aware that the late Court of Directors
proposed that the sum to be set apart as a Guarantee Fund
should be increased from 1,200,0001., to about 2,000,0001., the
amount at which his Majesty's Ministers have consented that
it should be fixed : but when that proposal was made, nothing
definite had been arranged regarding the term of the annuity,
and the view taken•by the Proprietors is, that at the expira-
tion of the term (since limited to forty years) the Guarantee
Fund with its accumulations should be equal to the capital
then to be discharged.

By adopting this suggestion, the sum to be set apart, instead
of two millions, would not fall far short of three millions ; but
the financial difference to India, between applying one million
in the liquidation of territorial debt, and investing it in Eng-
land, would be comparatively trifling. In the one case, indeed,
there would be an immediate reduction of charge in India to
the extent of the saving of interest from the discharge of debt ;
whilst, in the other case, the interest on the sum invested would
accumulate at home : but the accumulation would be expressly
for the purpose of enabling India to pay off a debt ; and you
will no doubt concur with us in thinking, that it consists with
sound financial policy that India, being required at a fixed period
to discharge an obligation, should provide for it, so as to obviate
" the necessity of any particular effort for that purpose," as was
observed in your letter dated the 14th March last.
We submit then, that the principle which the Proprietors
have recognised is just and expedient, both as affording to them
a security that there will be the means to redeem their capital
at the time appointed, and as assuring to India the posses-
sion of those means without having recourse to fresh loans.
The same principle might perhaps be maintained, consist-
ently with a limitation of the funds to two millions, by de-
termming that the annuity should be irredeemable (unless at
the option of the Proprietors in the contingency separately pro-
vided for) until the Guarantee Fund shall have accumulated to
twelve millions : but this arrangement would not be so satis-
factory to the proprietors as an extension of the fund; and the
Court must earnestly press upon his Majesty's Ministers their
decided opinion, that the Company are, upon every principle
of justice, entitled to retain out of the commercial assets the
very moderate sum of three millions.

The manner in which it is proposed to meet the views of the
Company with respect to a security for the regular payment of
the dividend is satisfactory to the Court, provided that it form
part of the enactment, that the guarantee fund shall in no case
be used for, or considered applicable to any other object, than to
secure to the proprietors their capital stock and their dividend.

. .
The suggestion of the General Court, that publicity should,
in certain cases, be given to the proceedings of the Board and
the Court of Directors, arose from a feeling that, in the im-
portant duty of administering the government of India, those
authorities should constantly act under the strongest sense of
responsibility to the legislature. The mode in which the
General Court have sought the attainment of this desirable
object is not, we think, correctly understood by his Majesty's
Ministers.

We admit that the terms in which this part of the General
Court's resolution is couched may appear to imply a desire that
Parliament should constitute either itself or some separate tri-
bunal as a Court of Appeal, to which the Directors might re-
sort upon occasions of differences with the Board .; but we have
no hesitation in declaring that, in our judgment, such a measure
was not within the contemplation of the General Court.

Although the Court of Directors did propose that there
should be some appeal upon the merits of cases of a very pecu-
liar kind, yet they cannot but perceive, that any appeal, if re-
sorted to generally, would produce delay and expense, which it
was one object of the General Court to avoid; and we are per-
suaded that the many evils which experience has shown to re-
sult from the difficulty of giving prompt effect to the final
orders of the Board, might be fully obviated by a simple enact.
ment, requiring that whenever the Court shall pass a resolution
of protest against orders or instructions given by the Board,
after remonstrance on the part of the Court, such resolution of
protest shall be laid before both Houses of Parliament.
Seeing, then, that the object is not the creation of a Court of
Appeal, but only the communication of a fact to Parliament,
and which, as it will be made after the orders are despatched,
will not have the prejudicial effect in India which, when colli-
sion between the Home Authorities now takes place, must
result from that fact becoming known to the local govern-
ments, simultaneously with, if not before the orders, we can-
not but hope that his Majesty's Ministers will concur in a pro..
posal which is calculated, in the opinion of the Court, to secure
the independence of the Company under the new system, to
check unnecessary controversy, to prevent expense in legal
proceedings, and to accelerate the progress of the public
business.

If the King's Ministers shall be pleased, under the explana-
tions which we have offered, to acquiesce in the wishes of the
proprietors, regarding an extension of the guarantee fund and
the question of publicity, it will be unnecessary, in the present
stage of the negotiation, for the Court to do more than to com-
municate to the General Court the further correspondence
which has passed upon the subject; but if, contrary to the
anxious hope of the Court, Ministers should decline their con-
currence upon these points, it will obviously be necessary to
consult the proprietors whether or not they will consent to the
basis of the proposed compromise, upon terms falling short of
those specified in their late resolution.

We have the honour to be, Sir,
Your most obedient humble servants,
(Signed) C. MARJORIBANKS,
W. WIGRAM.
The Right Hon. Charles Grant, &c. &c. &c.

LETTER FROM THE RIGHT HON. CHARLES GRANT TO
THE CHAIRMAN AND DEPUTY CHAIRMAN.
India Board, June 4, 1833.
Gentlemen,—l have had the honour to receive the letter
dated the 29th of May, and marked " secret," in which you
state the sentiments of the Court of Directors in reply to that
which I transmitted to you on the 27th of May.
While I acknowledge the spirit of courtesy which has in-
duced the Court of Directors to address me in a confidential
manner, I cannot but express my regret that my communi.
cations have not proved altogether so satisfactory to them as I
could have wished, and, indeed, as I ventured to anticipate.
Impressed with the importance of settling the East India
question, and anxious at the same time to testify a just defe-
rence for the Court of Proprietors,lby yielding to their sugges-
tions, whenever such concession was not incompatible with the
principle of the Government plan, his Majesty's Ministers wil-
lingly acceded to nearly every modification contemplated by
the resolution of the 3d of May.
It seems, however, to be impressed on the minds of the
Court of Directors, that the plan, even thus modified, fails
in affording to the Company that full security for their fu-
ture welfare and efficiency which, both in their proprietary
character and as the intended organ of Indian Administration,
they are entitled to require; and, with a view to the pro-
viding of such security, the Court conceive that, in two re-
spects, further concession should be granted. The one of these
two points relates to the guarantee fund, and the other to the
communication proposed to be made, in certain cases, of mat.
ters which shall have divided the Court and the Board, to both
Houses of Parliament.
It is my present object to offer some explanatory observe.
tions, which will, I trust, prove that on both points the Court
are under some degree of misapprehension; that there is no
necessity for any farther modification of the Government pro-
positions, inasmuch as, in virtue of the plan, or under its
operation, the Company will, for every practical purpose, pos-
sess all the security which can be desired; and consequently,
that no reason exists, why they should feel any hesitation in
closing with the overture of his Majesty's Ministers.
In respect of the first of the two subjects alluded to, namely,
that of the Guarantee Fund, you appear desirous of maintain-
ing the following principle : that the sum to be set aside shall
be sufficient, with its accumulations, to redeem the annuity of
630,0001. at the expiration of the period during which it is to
remain irredeemable; and you suggest that, in the event of
Ministers not consenting to such an increase of the Guarantee
Fund as shall, on reasonable calculation, insure an amount of
twelve millions at the end of forty years, then the period of re-
demption shall be prolonged, until the fund limited to two
millions shall, by dint Of accumulation, attain to that amount.
I hope, on this point, to satisfy you, that no provision of the
nature alluded to is requisite.
I will not now enter into the question, how far it may be
proper or expedient to provide a fund, in order to meet the pay.
ment of the capital at the period prescribed. The convenience
of such a provision, to a certain extent, I have admitted in my
letter, to which you refer, of the 14th of March. Its effect
must be, as I have there stated, to spare pro tanto the neces.
sity of a particular effort to raise the sum required for the re.
demption of the annuity. But, though admitting the principle
thus far, I do not think it of unlimited application, nor can I
concur in carrying it to the extent now proposed. On the con-
trary, his Majesty's Ministers entertain a confident persuasion,
that an accumulated fund of eight, or even of six millions,
would be amply sufficient to obviate any financial difficulty in
effecting any arrangement that may be suggested by the condi.
tion of paying the full amount of twelve millions.
With respect to the extension of the period for redeeming
the annuity, it cannot have escaped the observation of the
Court, that whenever Parliament shall avail itself of the op-
tion of redemption, that redemption must be effected at the
rate of 1001. for every 5/. 55., as expressly provided for in the
Paper of Hints. Should it be resolved, therefore, by the Go.
vernment and Parliament of the time, to redeem the annuity
of 630,0004 before the Guarantee Fund shall have swelled to
the amount of twelve millions, they can carry this resolution
into effect only by raising the additional sum necessary for that
purpose, and thus placing the Proprietors precisely in as good
a condition as that in Ohich they would have stood, if the fund
itself, with its accumulations, had attained the required amount.
On the other hand, should the Government and the Parlia.
ment not see fit to exercise their optional power of redeeming
the annuity before the Guarantee Fund shall have risen to
twelve millions, then the consequence ipso facto must 1).4 that
the Proprietors will continue in the receipt of the annuity of
630,0001. until the time arrives at which the accumulated fund
shall reach the proper amount.
It is therefore obvious, that under the proposed arrange-
ment the Proprietors are secure of one or other of those alter.
native advantages which the Court are so desirous of obtaining
for them. If paid off before the period at which the Guaran.
tee Fund shall have become twelve millions, they will have the
same advantage as if the fund provided had been larger; if not
paid off before that period, they will have the same advantage
as if the term of redemption were extended.
I now proceed to the second of the two points on which the
Court are solicitous for further concession. I allude to the

proposition that, in any case in which orders
India, by the overruling authority of the Board,
been protested against by the Directors, it shall
to the Directors, after the transmission of such
their resolution of protest before both Hous
ment. This proposition has engaged the rem
tion of his Majesty's Ministers; and, notwith
explanations of the Court, the Ministers can.
comprehend the grounds on which the propos]
strongly pressed. If the Court mean only that'
have the power of inviting the attention of Parli
matter of public policy which has placed them in
the Board, and which is, in their opinion, of a
for such a proceeding, it is plain that this powr
longs to the Court, in the constitutional privil
common with all the other subjects of the 11
doubtedly enjoy, of approaching either House
by petition. Of this privilege, and of all that
which it necessarily involves, to the judgment .
Lure and to the arbitration of public opinion, and
with which they are thus provided of checking
unconstitutional proceedings on the part of th,
of the Home Government, they are already in
sion. No new recognition of the existence of
can be necessary; and probably the exercise of
ther embarrassed than assisted, by any attempt to P'—co.
the mode, or to define the occasions of putting it in 6 vs,
But if any power materially different from this be c 0 1p
plated, his Majesty's Ministers must declare themsel/P -
able to accede to the suggestion. It might, inde6t to!
enough for them to observe, that the proposition Is
indistinct to be accepted in its present form ; but they ro
to it on independent grounds. They are satisfied that'.
all practical purposes, the Court are already invested nritho4
cient powers; and they cannot but object to the intrro.
Lion into the system of the Home Government of al
cipte of which they cannot admit the necessity, and ni
whatever be the precise shape that it may assume, cann_ut Pd'
_sdi
to operate, as they apprehend, very prejudicially to the Inur
of good government.
The observations into which I have thus entered, will,
hope, be thought sufficient to establish the position with W 7.1,
I set out ; namely, that all the security which the CoinP7o
either as Proprietors of Stock or as Governors of
reasonably desire, they already possess. D(
In now coming to a close, I feel it my duty, on the r ivi,
his Majesty's Ministers, to request that the present conlo
cation may be considered as final.
It will not, lam persuaded, be ascribed to any want le‘
spect, or to a wish for premature or precipitate judgment,o,
further feel it my duty, on the part also of his Majesty's f°oo
sters, to ask, that on the essential principles which fora
basis of the Government plan as it here stands, the Cowl
will be pleased to pronounce an opinion unconditional'',
conclusively.

It is not for me to anticipate their decision, furthes the D,
saying that I look forward to it, not indeed without a die:;up
of solicitude, but on the whole with sanguine hope- 11,01
Sion has smoothed down the discrepancies between the vitsf:
sentiments of the Company and those of the Government,
has shown that those discrepancies were more apparent !if
real; and though to some extent a diversity of opinion to
still be expected to subsist, yet I cannot but persuade lliPeu,s
the definite determination of the Directors will be, to res,{
mend the plan to the adoption of their constituents, and
their advice will be followed.—l have, &c.
O
(Signed) CHARLES PRAT
The Chairman and Deputy Chairman
of the East-India Company.

COAT A SECRET COMMITTEE OF THE WHOLE -Vir"
Held on Friday, the 7th June, 1833. let°
The Committee resuming the consideration of the 4J
from the Right Hon. Charles Grant, dated at the India VO4
the 4th instant, in reply to the letter from the Chairman
Deputy Chairman of the 29th ultimo;
The Chairman submitted the following motion viz. iA
" That this Court continuing of opinion, that the '°
which it is suggested, in the General Court's resolution 'ow
3d ultimo, that the Guarantee Fund should be extended, 15411
sistent with sound principle and with justice to the reas°tV
expectations of the proprietors, and continuing also to
that some rule of publicity would be necessary, under4t
new system, to preserve the independence of the Cogne
and to secure the good government of India, regret thz7,
are compelled by a sense of duty to decline to recononen
the proprietors to depart from their resolution in either
these respects."

And the question thereon being put,
It passed in the negative.

It was then moved, and on the question, SnIP
Resolved, That the following minute and resolution be
mated for the adoption of the Court, viz. : letler
The Court proceeding to take into consideration the toj
from the Right Hon. Charles Grant, dated the 4th instate"
observing that the several suggestions contained in the
ral Court's Resolution of the 3d ultimo, have been adopted of
his Majesty's Ministers, with the exception of the amount
the Guarantee Fund, which, however, Ministers havee except;
shall be extended to two millions ; and
also of what relates to the giving publicity, in certain
to the proceedings of the Board and the Court;
oe
" Resolved, That although the Court must be permitted
to think that the mode In which it has been suggested. ,bltbe,
General Court, in their Resolution of the 36:1
ith a
Guarantee Fund should be extended, is only consistent ;f,.
what is justly due to the reasonable expectations of the bio
prietors, yet perceiving, as the Court do, with satisfacti°n'ty
admission by Mr. Grant of the principle contended for Id ft
Company, to the extent that, if paid of before the Per',;ool,
which the Guarantee Fund shall have become twelve On' ilyd
they will have the same advantage as if the Fund provid7bo4
been larger ; if not paid off before that period they vilue
the same advantage as if the term of redemption WerLocll
tended;' and considering also that, by the modification. wterisi
Ministers have allowed, the Company will obtain a viii bf
addition to the amount first proposed, and the Fund staid
available to secure the Dividend as well as the Capit°l., bth/
this Court are prepared to recommend, that if it 0100" 0001
pleasure of Parliament to limit the sum to be set apart
with the c

millions, the Proprietors should defer thereto. hsfe
" That this Court adhere to the opinion which the/ to
repeatedly expressed, that some measure of publicityr
r 1 a'
exercised as a rule, not as a privilege, will be neceto le,
preserve to the Company, under the altered circurnat3"degfr
which the plan of Government will place them, tbaalt deo° 1;
of independence which is required to enable them e: spd
to perform their part in the government of India'oleo"
the Court entertain a confident expectation that FerP-ofi'
taking the same view of the subject, will make suitable pr
,
sion accordingly. P t
" That as, notwithstanding this exception, sollPe,i'Tg- tpB
Proprietors to concur in the recommendation respecieee‘e
amount of the Guarantee Fund, the Company's aetle:pe (le'
in the essential principles which form the basis of `,,,perr
vernment plan,' as modified in consequence of the ''oljjoi
Court's late Resolution, will have been expressed so 10 teco4
of its being brought before Parliament, it will be uno doe 7,
to adopt any further proceeding at present, as the quel
placing the Company's paramount commercial rightsol
their Charter in abeyance cannot be conclusively dec.; obi tc"-
the Proprietors, until they have before them the Bill OPI
Parliament may propose to give effect to the plan, the bat
of which has yet been agreed upon. Pie°
" That a Special General Court be summoned rijitil
on Monday next, the 10th instant, for the purpose b'osetr
before the Proprietors the further correspondences t
with this Resolution."
.„,.nuter
A report to the Court, submitting the foregoing a.'
Resolution was approved and signed.

A teenhues s
arteaAeareßmtTami
Reportnoi
same was
nti, Ahe
eunf;rtni
Grant,o SmFEdutCanhtßdee
dated
should
toh.Cel
dO 4thUb Committee
eR Toinf instant,
extended,ahFne
tDIRECTORS'
Iv,,i,Whole
oicloehnlwasy Court'
cos, .
I,
Of
g :re
eo:
Heldfeos:l:
uwt oii
oint
ngF
druiapdyony,
a,
ntthdh
eerl7eetfteht
re
rJrfnr
oet,mol 830
theh
e.
ICI,
ic el, 4
tofco Majesty's
ctc3
.hrbholouohensii
Court'sT,
Amuraasensrrrhhui
ndadti
ye Minute
oictnag,Rhonetbuedhesrs
Resolution
saidthat
submittingfortheCourt's
Minute and Resolution having been read ; ,
sdi: :
orawsnp.h.p
icrwcohhivte approved,
e,t
shbeGe
however,irenaxg. tea s,
Ministers p
dtiaotiedated
follows,oftht heheeiavt.
aeh, r
;ars
te
doe::
1:er;
nseveralof proceedingthe ts3oucitgaugkletesi
ti
ultimo
into consideration
ave
been
containedaidnotphit,
e;e:
ooti
fictr:o:l4:
be extended to two millions ; and with the exception' to t
what relates to the ealgthivoiungghpubthliecitcy,ouinrtemerutasitn
..,e_::_eg'esot.ho..l
proceedings of the Board and the Court ; Ilr"
he pat!' Pi
still to think that the mode in which it has been 57,1-ino, ''',.ol
the General Court, in their resolution of the 3d n'-, ist,%"e
with what is justly due to the reasonable expeetatlf:sion
proprietors, yet perceiving, as the Court do, with ',tett fOl
an admission by Mr. Grant of the principle conten. e per,
the Company, to the extent that, 'if paid off before th wilt
at which the Guarantee Fund shall have become twelveted ji e
they will have the same advantage as if the fund POI,IOOOO
been larger ; if not paid off before that period they Wil,eoletl:o
same advantage as if the term of redemption were el"„,;oist
and considering also that, by the modifications which neon n
have allowed, the Company will obtain a material an:°;oje,l;
the amount first proposed, and the fund will be
in v,,°;404 l'',,i
secure the dividend as well as the capital stock ; ths
.'e'ssoe_i.""
prepared to recommend that, if it should be the PI 000"
i Parliament to limit the sum to be set apart to two
re,
the Proprietors should defer thereto. have er•
That this Court adhere to the opinion which they De 0 e
peatedly expressed, that some measure of publicity, t°
,oerl, „
cised as a rule, not as a privilege, will be necessary to.1"00,e.
to the Company, under the altered circumstances Ini tod
the plan of Government will place them, that degrete °I, le,
pendence which is required to enable them eflicienca_rcor.
form their part in the government of India ; and 110% tll",
entertain a confident expectation that Parliament, in
„DO
same view of the subject, will make suitable provision
•--
~,, e;
dingly. • •ig 1...- os•
That as, notwithstanding this exception, supposing
,wo e
prictors to concur in the recommendation respecting the. o tp,
of the Guarantee Fnnd, the Company's acquiescence eln.,oel):
essential principles which form the basis of " the Gov. I.o' at li
plan," as modified in consequence of the General ~00,
itslatebreei
nsogl resolution,
ht will
before hav epbareleinameexnptr,esistewd 1
llsboeaus n
nt oe_ceneitsioaroy,
o°4i,
adopt any further proceeding at present, as the qn. na.t'e
placing the Company's permanent commercial rcir iv . 1)::
their charter in abeyance cannot be exclusively de 01.eu_. gs,loo
proprietors, until they have before them the Bill 07

11‘'t ha
14tant:
-;lthe
It4ti°4 t
tidy
:14enc'el
Nen
have
you]

Ana
t4° cl '
tiers ai
Of h.
Oki kilt(
IN fur
4Pectinj
t
"
41 f
I bti
Lt •
o im
to giv
whi

R3'' Gov
expedie
I thAt

'avoid th
Agag sem

ay %fie
~°fallyc
tk, 4,0 dot

Oar of
pig aetaiL
Corm sl_
, arid
tt‘lf the

eCt
air% plod an
ohs
► lard
kit
e° b
!y
":41

,_,40 rnay 1
rs desprerutt ebich hae
lard, eb2Tilil? trial
nbe ers lif the lc
to ,
h orderet.,,, tors tl
woes of 5:00, :
renewed.. ,it tt.f a tette
ithstanalo, ng a
CO
annot 10%i . 1
ropositioe ;t ''.
t they oul , , „nu
[
rliament tV . eof an
.n collisi°ll,l e eorres;
' a nature wli illeisters
wer alresdji,
i
4 to th
rilege wh2A ''°prt.
realm, tr
,„„_°t an al
eof Parsvit 4'011410
right of_ al" 'erther
. of the 1A pa
tbort
end of the
eiroti 444 wil
ig any ill.. 00). oo )4,
he other
1 secure FLP It
"it would be.,,fi It' .tu
of such 3r 0 'MIX 1