Lord Salisbury, challenged to prove the accuracy of this opinion, re-affirmed it in the most positive manner, and said that he arrived at this interpretation of the Act of 1858 after consulting the very highest legal authority, who, as subsequently appeared, was Lord Cairns. On the other hand, the Duke of Argyll maintained that in arriving at exactly the opposite opinion he was supported by the Law Officers of the Crown. As the discussion proceeded this extraordinary conflict of authority became, if possible, still more marked. Lord Hatherley, who at the time was Lord Chancellor, supported the opinion that had been expressed by the Duke of Argyll as to the functions of the Council, and said Lord Cairns "appeared to give a meaning to the words of the Act which they could not bear in any sound legal construction." Commenting on these differences of opinion, Lord Salisbury maintained that it was imperatively necessary, where such vast interests were at stake, that the law should be unmistakably clear, and said that "about the doubtfulness of the law there could be no doubt whatever.

When the Lord Chancellor said a thing was black, and two ex-Chancellors said it was white, there must be some doubt about the law."

A striking example of the consequences that may be produced by leaving the law in such a state of uncertainty is afforded by an event which has recently happened, Lord Salisbury and Lord Cairns, having, as has just been shown, expressed a decided opinion that "in reference to every question in which expenditure is involved.... the Indian Council have the power of absolute and conclusive veto by a bare majority over the decision of the Secretary of State," are members of a Cabinet which adopted a "forward" frontier policy in India, involving an expenditure of millions, not only without the consent of the Council being obtained, but without the matter being brought within their cognizance.

There is apparently the same difficulty in interpreting other provisions of the Act of 1858 which are not less important than those which refer to the members of the Council of the Secretary of State. This has lately been shown in a striking manner by the controversy which arose out of the remission of the cotton duties. A majority of the members of Council of the Viceroy were opposed to the reduction of these duties, and it has been maintained on high legal authority that under these circumstances the Viceroy, in overruling the majority of his Council, put a very strained interpretation on the legal power conferred upon him. The legal member of the Council of the Viceroy may be considered the highest legal authority in India, and the present holder of that office, Mr. Whitley Stokes, referring to the course taken by the Viceroy with regard to the reduction of the Cotton Duties, used the following words:- "The proposed exemption of cotton goods, if made by a mere executive order, will thus resemble what lawyers call a fraud on the power; and there is, unfortunately, no Court of Equity to relieve the people of India against it." 1

After what has just been stated, it cannot be necessary to multiply instances to show that the law which now regulates the Government of India is in a state of chaotic confusion. It cannot be right that there should be the widest divergence of opinion between the highest official authorities both in India and in England as to the powers which can or ought to be exercised by those who hold most influential positions in the Government of India. When the Act of 1858 was passed it was intended to vest the chief financial control in the Councils of the Secretary of State and of the Viceroy. Before the abolition of the Company this control was in a great degree exercised by the Directors and by the Court of Proprietors. It invariably happened that several Directors of the East India Company were in Parliament, and the Company was thus able to exert great influence, both on English public opinion and on the English Government. If it was thought that with regard to any question in which the interests of England and India came into conflict, India was unfairly treated, the influence which was possessed by the Company both within and without the walls of Parliament was sure to be vigorously exerted on behalf of India. Under the present system, however, it is a mere matter of chance whether any one will be found in Parliament specially to watch over the interests of India. It is perfectly well known that seldom has any measure been passed which was more disliked by the people of India than the recent reduction of the cotton duties.

Sir Alexander Arbuthnot, a member of the Council of the Viceroy, speaking with official responsibility, has said: -

1 See "Copy of Dissents recorded by Members of the Council of the Governor-General of India regarding the late Reduction of the Cotton Duties in that Country," presented to Parliament in May, 1879.

"There can be no doubt that the people of India attribute the action which has been taken by Her Majesty's Government in this matter to the influences which have been brought to bear upon it by persons interested in the English cotton trade, or, in other words, by the manufacturers of Lancashire."

He adds: -

"It is very undesirable that an impression should exist which, if it were well founded, would go far to justify the forebodings of those who deprecated the transfer of the direct government of India from the East India Company to the Crown on the ground that India would be sacrificed to the exigencies of political parties in Parliament. For many years after that transfer took place the propriety, and indeed the necessity, of treating Indian questions, and especially questions connected with the internal administration of India, as a thing apart from parliamentary politics, was recognised by both the great parties in the state. By a tacit but well-understood compact, India was excluded from the arena of party politics in the House of Commons. Now, for the first time, there is a prevalent belief that this understanding has been departed from. A measure seriously affecting the finances of India has been, and is being, pressed upon Parliament by a powerful section of the English mercantile community, and the general opinion is that that pressure has so far produced an effect that at a juncture of the gravest financial difficulty and anxiety the Government of India has been impelled to incur a sacrifice of revenue which the most ordinary considerations of financial prudence should have led it to retain, with the certainty that the present concession will only encourage further pressure, until the whole of the particular branch of the state revenue which has been the subject of attack shall have been abandoned." 1

So impossible does it appear to be to interpose with any effect on behalf of India, if the wishes of her people have to be weighed against the support of a certain section of English voters, that when the action that had been taken in reference to the cotton duties was called in question in the House of Commons, the protest had to be made by a mere handful of members.

When considering in the following pages the causes which have made the present financial condition of India so unsatisfactory, numerous instances are adduced which, I believe, conclusively show that there is little hope of effecting any real and permanent improvement in her finances, unless some more adequate financial control is provided than that which is furnished by the present system of administration. As previously stated, the two bodies in whom this control was chiefly vested have, through the uncertainty of the law and other circumstances, been gradually deprived of much of the power which it was supposed they could exercise. If a Viceroy in a period of severe financial pressure can sacrifice an important branch of revenue in direct opposition to the wishes of a majority of his Council; if a Secretary of State can decide upon a policy which will involve the outlay of millions, and free himself, not only from the control, but from the criticism of his Council by availing himself of the undefined powers which are vested in him of placing the despatch which orders the expenditure in the secret department - it is at once obvious that the control which these two Councils can exercise is most inadequate.

Few problems in government can be more difficult than to devise the best means by which this control can be supplied. It is a problem which can only be properly solved after the most careful inquiry, which will enable due consideration to be given to the opinions of those who can speak with the greatest authority and experience. Although therefore it would now be premature to attempt to indicate the changes which should be introduced into the Government of India, no one, I think, can deny that events are every day happening which show that the reform of her administration is a matter of such urgent importance that an inquiry as to the best means of effecting it ought to be one of the first subjects to engage the attention of the new Parliament.

1 See Parliamentary paper just referred to.