In the months of December 1762, Vansittart negotiated a new agreement with Mir Kasim, Nawab of Bengal, regarding duties (the system of taxing on goods) on English private trade. They agreed to a rate of nine per cent tax. If any disputes were to arise, native officers of justice were to reconcile the issue. The Bengal Council however, absolutely rejected Vansittart`s agreement.
On 15th May 1763, on behalf of the Company, Peter Amyatt (d.1763) met Mir Kasim at Monghyrl for fresh trade talks. Here, Peter showcased a new plan calling for free trade, excepting a two and a half per cent tax on salt. On May 26th, Mir Kasim rejected this plan downright.
On 24th and 25th June, aware of Mir Kasim`s approaching troops, William Ellis (d. 1763), the Company Agent at Patna, seized the city. Ellis was forced out just as quickly by the Nawab`s troops. At the nearby Company factory, approximately 170 Europeans and 1200 Sepoys surrendered to Mir Kasim`s troops led by Markar and Sumroo.
On 10th June, Major Thomas Adams (d. 1764) with a force comprising 1000 Europeans and 4000 sepoys (soldiers) headed for the upcountry in Patna. This force captured Kutwa on June 19th and took Murshidabad on June 24th. On 3rd July, Mir Kasim ultimately nabbed Amyatt and his party. Amyatt had previously been detained at Murshidabad. Kasim seized the chance to slaughter the English entirely.
On 8th July 1763, in response to the news from Patna about the terrible crisis, the Bengal Council announced the restoration of Mir Jafar as the Nawab of Bengal.
On 10th July, the Company executed a treaty with Mir Jafar. The treaty provided for free trade, with the exception of a two and a half per cent tariff on salt and for damages caused by Mir Kasim to Company property or persons. The Company also obliged Mir Jafar to maintain an army of 12,000 foot and 12,000 horse. The treaty also stated that in future, only the English would be allowed to construct fortifications.
On 5th October, Mir Kasim prepared for an even more ruthless reply to the British. He ordered the slaying of all English prisoners at Patna which numbered about fifty. On 6th November, Adam`s force stormed and captured Patna, but Mir Kasim escaped to Oudh. Patna crisis seemed to intensify further, with none of the battling parties trying to arrive at a conclusion.
In February, the elections for the East India Company`s Court of Directors and its Chairman embraced the struggles of Laurence Sullvan (c.1713-1786) and Robert Clive for the dominant influence in the making of Company policy. The Company policy, on this occasion was won by Sullvan. Their dispute focused on the level of severity of terms in the Treaty of Paris ending the Seven Years War. In the long term, their struggle impacted the development of Company policy in India. The struggle would drag into the fray the attention of Parliament.
On 10th February 1763, Great Britain and France signed the Treaty of Paris ending the Seven Years War. Article eleven of the treaty laid out the restoration in India of the French colonial possessions of Pondicherry and Chandannagar.
