The experience of injustice

The experience of injustice was not simply about debt or dependence — it was about the violation of trust and custom. The ryots were enraged not because they owed money, but because the moneylenders (sahukars) had become insensitive to their plight and were breaking the unwritten rules that had long governed rural life.

The breakdown of customary norms

Before colonial rule, moneylending was widespread and moneylenders were often powerful, but a variety of customary norms regulated their relationship with the ryot. One key norm was that the interest charged could not exceed the principal amount of the loan. This was meant to limit the moneylender's exactions and defined what was considered "fair interest." Under colonial rule, this norm broke down entirely. The Deccan Riots Commission investigated cases where a moneylender had charged over Rs 2,000 as interest on a loan of just Rs 100. In petition after petition, ryots complained of such exactions and the violation of custom.

The ryot's petition: a catalogue of oppression

A petition from a ryot of Mirajgaon village to the Collector of Ahmednagar, submitted to the Deccan Riots Commission, reveals the specific grievances:

• Ryots were forced to beg moneylenders for money, clothes, and grain just to meet household expenses.
• Loans were given only under "hard conditions" in the bond.
• Goods like clothes and grain were sold to ryots at prices 25 to 50 per cent higher than cash rates.
• The produce of the fields was taken by the moneylender, who promised to credit it to the ryot's account but never actually recorded it.
• No receipts were given for the produce removed.

Deeds of hire: losing what was once yours

When debts mounted and the peasant could not repay, he had no option but to give over all his possessions — land, carts, and animals — to the moneylender. But without animals, he could not cultivate. So he took land on rent and animals on hire from the same moneylender. He now had to pay for the animals that had originally belonged to him. He had to sign a deed of hire stating clearly that these animals and carts did not belong to him. In cases of conflict, these deeds could be enforced through the court.

A deed from November 1873, recorded by the Deccan Riots Commission, shows the peasant's commitments:

• He sold his two carriages with iron axles and four bullocks to the moneylender on account of debt.
• He then took the same carriages and bullocks on hire.
• He agreed to pay Rs 4 per month as hire.
• He had to obtain a receipt for each payment, and if no receipt existed, he could not claim that the hire had been paid.

This deed reveals a transformed relationship: the peasant no longer owned the bullocks he worked with. He was now a tenant of his own former property, paying rent to the moneylender for the right to use it.

The manipulation of law and accounts

The ryots came to see the moneylender as devious and deceitful. They complained of moneylenders manipulating laws and forging accounts. In 1859, the British passed a Limitation Law stating that loan bonds between moneylenders and ryots would have validity for only three years. This law was meant to check the accumulation of interest over time. But the moneylender turned the law around, forcing the ryot to sign a new bond every three years. When a new bond was signed, the unpaid balance — the original loan plus accumulated interest — was entered as the principal, and a new set of interest charges was calculated on that inflated amount.

How debts mounted: a concrete example

A ryot explained the system in a petition to the Deccan Riots Commission. A moneylender lends Rs 100 at a rate of Rs 3-2 annas per cent per month. The debtor agrees to pay within eight days. Three years after the due date, the moneylender takes a new bond for the principal and interest together, at the same rate, allowing 125 days to repay. After another three years and 15 days, a third bond is passed. At the end of 12 years, the interest on the original Rs 100 amounts to Rs 2,028-10 annas-3 paise.

The new regime of bonds and deeds

The moneylenders used a variety of other means to short-change the ryot:

• They refused to give receipts when loans were repaid.
• They entered fictitious figures in bonds.
• They acquired the peasants' harvest at low prices.
• They ultimately took over peasants' property. …