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gagor delivers possession of the land to the mortgagee, and authorizes him to retain such possession and to receive the rents and profits of the land in lieu of interest, and towards payment of the principal on condition that after the expiry of the period agreed on, or (if no period is agreed on, or if the period agreed on exceeds fifteen years) after the expiry of fifteen years, the land shall be redelivered to the mortgagor, and the mortgage debt shall be extinguished:

Any condition attached to any such usufructuary mortgage by which any legal or customary obligation of the landlord in respect of the land mortgaged is imposed on the mortgagor during the currency of the mortgage, or by which the right of the mortgagor to redeem the property at any time during the currency of the mortgage is barred or restricted, shall be null and void.

(b) In the form of a mortgage without possession, subject to the condition that, if the mortgagor fails to pay according to his contract, the mortgagee shall have the right to claim a usufructuary mortgage in form (a), but shall not have any other remedy against the land mortgaged: such usufructuary mortgage to take effect from the date on which the mortgagee is placed in possession of the land, and to remain in effect for such term not exceeding fifteen years as the Revenue officer, on the application of the mortgagor, may deem to be equitable, and to be for such sum as may be due to the mortgagee on account of the balance of principal due and of interest due (not exceeding the amount claimable as simple interest for three years on the original debt). (2) If any person has, before the commencement of this Act, made a mortgage of his land by way of conditional sale, or shall, after the commencement of this Act, make any mortgage of his land not permitted by the Act, such mortgage shall be null and void:

Provided that the Revenue officer, on the application of the mortgagor or the mortgagee, may order the mortgagor to execute a usufructuary mortgage as permitted by sub-section (1) for the term of fifteen years, or for such less term as the Revenue officer considers equitable.

(3) Applications under this section shall be made to such Revenue. officer, not lower in rank than a Deputy Commissioner, as the Local Government may determine.

VII. Any person may make a lease of his land for a term of fifteen years if the lessor shall so long live, and any such lease made by any person for a longer term shall be deemed to be a lease for the term permitted by this section.


VIII. A person who has made a mortgage or a lease of his land in any form permitted by this Act shall not be at liberty to make any further temporary alienation of his land during the currency of such mortgage or lease.

IX.-(1) If a mortgagee or lessee remains in possession after the expiry of the term for which he is entitled to hold under his mortgage or lease,

the Revenue officer may, of his own motion or on the application of the person entitled to possession, eject such mortgagee or lessee, and place the person so entitled in possession.

(2) The power conferred by this section shall be exercised by a Revenue officer not lower in rank than Deputy Commissioner.


X.—(1) No person shall be at liberty to make any permanent alienation of his land unless in manner permitted by this Act.

(2) Any such permanent alienation made without the sanction required by this Act shall take effect as a usufructuary mortgage on the conditions prescribed by Section VI., sub-section (1), clause (a).

XI.—Every instrument or agreement whereby an agriculturist purports to hypothecate the produce of his land or any part of, or share in, such produce shall be void.

Explanation. The produce of land means:

(a) Crops and other products of the earth standing or ungathered

on the holding;

(b) Crops and other products of the earth which have been grown on the land, and have been reaped or gathered and are deposited on the land, or on a threshing-ground, or within the village in which the land is situate or the agriculturist resides.

XII. No land shall be sold in execution of any decree or order, whether passed before or after the commencement of this Act.

XIII.-No instrument which contravenes the provisions of this Act shall be admitted to registration.

XIV. (1) An appeal shall lie from the order of a Revenue officer granting or refusing sanction to a permanent alienation of land or dealing with an application under section VI.

(2) If the order is that of a Tahsildar or other Revenue officer lower in rank than a Deputy Commissioner, the appeal shall lie to the Deputy Commissioner; if it is the order of a Deputy Commissioner, to the Commissioner; if it is the order of a Commissioner, to the Financial Commissioner.

(3) Except as provided by this section, no proceedings shall be taken to question the validity of any order made by a Revenue officer under this Act.

XV.--The Local Government, with the previous sanction of the Governor-General in Council, may, by notification in the local official Gazette, exempt any district or part of a district or any person or class of persons from the operation of this Act or of any of the provisions thereof. XVI.—(1) The Local Government may make rules for carrying into effect the provisions of this Act;

(2) In particular and without prejudice to the generality of the foregoing provision, the Local Government may make rules prescribing the Revenue officers to whom applications may be made, and the manner and form in which such applications shall be made and disposed of.



THE Complete reorganization of the monetary system of India now in process of being effected by the Indian Government is the most important economical event in the history of that country.

The monetary system of any country comprises (1) the system of coinage, and (2) the system of banking and paper


The Indian Government has already passed an Act to restore its ancient gold currency to India which it enjoyed for thousands of years, until on January 1, 1853, when by a single stroke of his pen Lord Dalhousie demonetized the whole of the gold currency of India, which was estimated to amount to £120,000,000, and for the first time silver became the sole legal tender throughout India.

But in 1864 the whole of India revolted against the silver standard, and earnestly requested that its gold currency should be restored to it, and that the sovereign should be made the standard unit. The Government has now at last taken measures to carry into effect the unanimous. demand of the people of India in 1864, and therefore I need not further refer to it. It will, however, necessarily take some little time to complete this great operation, but when the gold currency has been established on a secure and permanent basis, the next thing to be done is completely to reorganize the system of banking and paper currency, which is in the most crude, barbarous condition, and utterly inadequate for the growing wants of the country.

The Indian Government has declared its intention of instituting a thorough and exhaustive inquiry into the whole question of banking and paper currency, and it is to be hoped that they will be very careful as to the selection of the persons to whom the inquiry is entrusted. So long as a country is in a stagnant state, and its industry is mainly



agricultural, a purely metallic currency may suffice for it. But the invincible objection to a purely metallic currency is that it is entirely inelastic. It may be compared to water used as a motive power; but when, on an established metallic currency, a well organized superstructure of credit is raised, it is like converting water into steam. "If you were ignorant of this," says Demosthenes, "that credit is the greatest capital of all towards the acquisition of wealth, you would be utterly ignorant," and this when credit was in its rudest and most undeveloped state, when it was no more to be compared with its organization at the present day, than the early form of the steam engine in Newcomen's day was to be compared with its development at the present day.

The great American statesman and jurist, Daniel Webster, said: "Credit has done more, a thousand times, to enrich nations than all the mines of all the world." And at the present time the power and progress in wealth of any country chiefly depends on the organization of its system of credit.

No more striking example of this can be given than that of Scotland, which is universally acknowledged to possess the best organized system of credit in the world. Upon a metallic basis of £5,000,000 is raised up a structure of banking credit amounting to about £100,000,000, and these banking credits produce exactly the same effects in every respect as an equal quantity of gold. It is no exaggeration, but a melancholy truth, that at the period of the Revolution in 1688, and the foundation of the Bank of Scotland in 1695, partly owing to such a series of disasters as cannot be paralleled in the history of any other independent nation, partly owing to its position on the very outskirts of civilization, and far removed from the humanizing influence of commerce, divided into two nations, aliens in blood and language, Scotland was the most utterly lawless and barbarous country in Europe. And it is equally undeniable that the two great causes of her progress in civilization and

wealth have been her systems of national education and banking.


Other countries when they wish to execute great works seek to borrow British capital. But the prodigious progress of agriculture and all the great public works in Scotland-roads, harbours, canals, railways, and others have been executed by means of her own banking credit. land never had to go beyond her own borders to borrow an⚫ ounce of foreign capital. What the Nile is to Egypt her banking system has been to Scotland: and it is fortunate for her that the foundations of her prosperity were laid broad and deep before the gigantic fallacy was dreamt of that the issues of banks should be inexorably restricted to the amount of gold they displace; that no increase of money can be of any use to a country; and before Mill had proclaimed to the world that to create credit in excess of specie is robbery!

Whenever the spirit of enterprise awakes in a country, either in commerce or industry, it is indispensable to create great banks with the power to issue notes to supplement metallic money. What is it that has permitted the prodigious development of industry and commerce in Germany in recent years? ? It is simply the creation of her stupendous banks.

India is now assuming a great position as an industrial and commercial country, and it is absolutely necessary to reorganize her whole system of banking and paper currency, which is, as I have said, in the most crude and barbarous condition, on the best European models. In the proposed reorganization of the banking system of India two plans have been suggested.

1. To institute a great State Bank with a capital about equal, and a constitution similar, to that of the Bank of England, which should absorb the Presidency banks, and establish a great dominant bank similar to the Bank of France.

2. To reorganize the Presidency Banks, enlarging their

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