The Act for the Good Government of India (Government of India act 1858) provided for liquidation of East India Company, and transferred the powers of government, territories and revenues to the British Crown.

The principle of Doctrine of Lapse was withdrawn, liberty was given to Indian rulers subject to British suzerainty and it also opened some door for Indians in Government services.

The office of secretary of state was vested with complete authority and control over Indian administration, thus he was now the political head of the India. He was also a member of the British cabinet and was responsible ultimately to the British Parliament.

Viceroy was to be a direct representative of the British Crown in India. Lord Canning thus became the first Viceroy of India.

The Indian rajahs (traditional rulers) were assured that treaties made with them would be observed and that territorial annexation would be curtailed. The people of India were promised collectively that their traditional and religious rights would be respected, that there would be no interference with their customs and that they would not be discriminated against.
Although the life of the titular Moghul emperor Bahadur Shah was spared, he was deposed and, with this, ended some 200 years of Muslim Moghul rule in India. A new agrarian policy was introduced to guarantee security of tenure and to fix rent for lands. This policy freed cultivators from tedious settlements and excessive demands of the state.

The old ‘company’ army was demobilised and new regular forces raised. These were based on the recruitment of soldiers from the so-called martial races – Sikhs, Jats, Pathans and Gurkhas – who had remained loyal to the British during the mutiny, in preference to Brahmins and other groups who were regarded as troublesome.