The East India Company was dissolved in 1857 after the Indian Mutiny. When the EIC was formed, it was merely a chartered trading company - made to trade in India. However due the proximity of hostile French trading interests they developed a a standing force to protect the trading posts. This allowed for the EIC to become involved in local conflicts - gaining power and rights to taxation in return for help.

After the Battle of Placey - the EIC was the main power in India, and after the defeat of Tipoo Sultan and the Maharrata warlords gave almost total control of the subcontinent to the EIC.

However, 1770 Bengal Famine had ended unilateral control of India by the EIC. By basically forcing locals to grow cash crops not food - and not feeding them when they starved - the EIC was responsible for the deaths of the famine. Therefore the Board of Control was set up by the Government to stop the EIC from repeating mistakes. Slowly - as the company began to fail or fall apart - the Government got more and more power in India.

The Sepoy Mutiny was the final straw. The revolt of one of the Sepoy Armys and murder of westerners as Cawnpore (also possibly for the brutal response to it) was deemed the final straw - the company was dissolved and its land taken over by the government.