M Alliuddin Khan (presently in Karachi), a heir of the last Nizam of Hyderabad – who was the ruler of one of the largest and richest princely states in pre-independent India, has approached the Pakistani government to seek a share in the Rs 2,934 Cr that have been in a London based bank for almost seven decades now.
The amount has been the cause of one of the longest legal disputes between Indian and Pakistani governments in the British high court. The initial amount deposited in the Royal Bank of Scotland, then National Westminster Bank, was 1 million pound. It was reportedly transferred for Pakistan’s aid. The amount has now ballooned to 35 million pound by accruing interest.
The descendant, M Alliuddin Khan, approached the ombudsman last week.
Being a legal heir of the seventh Nizam, Khan demanded a share of the Hyderabad fund and said that he deserved it under the Sharia law.
Alliuddin Khan’s request came months after a court in UK dismissed India’s claim that Pakistan had no right over the fund. India says the amount was deposited by a delegation of officials of Hyderabad three days after the state acceded to the Indian union on September 17, 1948, and hence, the money should belong to India.
The descendants have taken a more collaborative approach now and were demanding the full amount till a few months ago. They say that the money deposited in the London bank was Nizam’s personal money and hence, it belongs to his descendants as per the principles of natural justice.
After the Nizam’s death in 1967, his family had also attempted to get back the money through an out-of court settlement but failed.
Documents reveal that the transfer was made as Indian troops began their annexation of Hyderabad immediately after the death of founder of Pakistan Mohammad Ali Jinnah. The transfer was made by then Hyderabad finance minister Moeen Ali and his representative in London Mir Ali.
The case took ugly turn after a week when the seventh Nizam, Osman Ali Khan claimed the payment had been unauthorized and Pakistan had no right to the money.
This prompted bank authorities to freeze the funds arguing it would hold onto them until the rightful claimant was established. The House of Lords in London in its judgement in 1957 had suggested an out-of-court settlement between Pakistan, the Nizam and the London bank. Khan said that India was nowhere in the picture then.