Holt Mackenzie in his Minute of 1819 emphasised the existence of village communities in Northern India and recommended settlement of land revenue demand by village or mahal and collection through village headman or Lambardar. This system was implemented by Regulation of 1822, tax was fixed at 80% of rental value. Features of this system are as follows:
- A third type of system called Mahalwari system was introduced in Agra, Awadh (Oudh), Central parts of India, Punjab, parts of Gangetic valley etc. during the regime of Lord Hastings.
- Mahal refers to an estate with many cultivators. In the Mahalwari system, all the properties of a Mahal were jointly and severally responsible, in their persons and property, for the sum assessed by the government on that Mahal.
Assessment of the system
- Found to be unworkable due to excessive state demand.
- William Bentick decided to reform the system. Reforms were carried under Merttins Bird (Father of Land Settlements in Northern India), and tax was fixed at 66% of rental value.
- Lord Dalhousie further reformed the land settlement by issuing Saharanpur Rules of 1855, tax was fixed at 50% of rental value.
- However, this rate was still too high and was one of the factors behind the 1857 revolt.
