The Limitation Law, which passed by the British in 1859, addressed which one of the following issues?

In 1859, the British administration passed the Limitation Law to address the growing issue of peasant indebtedness and the manipulation of accounts by moneylenders [1]. The law specifically mandated that loan bonds signed between moneylenders and ryots would have legal validity for only three years [2]. The primary objective of this legislation was to prevent the indefinite accumulation of interest over time, which often trapped peasants in a cycle of debt [1]. However, the law proved counterproductive in practice; moneylenders circumvented the restriction by forcing ryots to sign new bonds every three years [2]. These new bonds incorporated the unpaid principal and accumulated interest as a new principal amount, leading to even higher interest calculations and further exploitation of the peasantry [2]. This cycle of debt was a significant factor contributing to agrarian unrest, such as the Deccan Riots [2].

Sources

1. [1] THEMES IN INDIAN HISTORY PART III, History CLASS XII (NCERT 2025 ed.) > Chapter 9: COLONIALISM AND THE COUNTRYSIDE > Deeds of hire > p. 253
2. [2] THEMES IN INDIAN HISTORY PART III, History CLASS XII (NCERT 2025 ed.) > Chapter 9: COLONIALISM AND THE COUNTRYSIDE > Deeds of hire > p. 254