64 years, Rs 306 crore: How India won Hyderabad Nizam case against Pak

Then Nizam of Hydrebad Mir Osman Ali Khan filed a case in 1954 in a UK court for recovery of £1 million (now valued at £35 million) from Pakistani high commission. Verdict has now come in India’s favour.

  • Nizam of Hyderabad deposited £1 million with Pakistani high commission in 1948.
  • Nizam filed a case to recover that money in 1954, Pakistan refused to give it back.
  • Now, a UK court has ruled that Pakistan does not have claim over Nizam’s money.

Any win over Pakistan is always sweet for Indians. One more has come India’s way from international arena. A UK court has dismissed Pakistan’s claim on £ 1 million deposited in 1948 by the government of Hyderabad Nizam with the Pakistan High Commission in London. The current value of the deposited money is £ 35 million or about Rs 306 crore.

It was the second high-profile victory for Harish Salve while representing India in a case since he won a reprieve for Kulbhushan Jadhav at the International Court of Justice (ICJ). Khawar Qureshi QC was Pakistan’s barrister in both cases.

What was the Case? It so happened that following the partition of India, the Nizam of Hyderabad wished to remain independent much against the wishes of the local populace and Pakistan actively supported the Nizam hoping that could be the third pocket of Pakistan – East Pakistan, now Bangladesh, was the second.

The Nizam apprehended a military action from India and sought arms and weapons from Pakistan. Nawab Moin Nawaz Jung, the finance minister and the foreign minister of the Nizam of Hyderabad transferred Sterling Pound 1,007,940 to Pakistani High Commissioner to the UK Habib Ibrahim Rahimtoola’s account on the behalf of the Nizam.

Under compelling circumstances, Hyderabad was annexed in 1948. Nizam Mir Osman Ali Khan, later, said that his minister transferred money without his approval. In 1954, he moved the UK court seeking release of the money deposited with the Pakistani high commission. But Pakistan did not intend to oblige and invoked sovereign immunity. This means the case could not proceed further. The case remained dead till 2013.

In between, the Nizam created a trust for the welfare of the people. It was to be funded from the interest of his Hyderabad Fund. In 1960s, he appointed trust to his grandsons – the current claimants – and assigned his claim to the fund to the President of India. The princely state and the Union of India had reached a deal of merger long before.

The skeletons of the Hyderabad Fund tumbled out suddenly in 2013, when Pakistan sued the National Westminster Bank, the custodian of the Nizam’s fund. This revived the old suit as Pakistan’s filing of case against the bank meant the country waiving off sovereign immunity it invoked 65 years ago.

The trial began. Pakistan argued that India’s claim on the Hyderabad Nizam’s fund was timed out. India countered the argument saying it was Pakistan which had blocked proceedings in the case. The UK court concurred with India.

Another major thrust of Pakistan’s argument was that Indian action in Hyderabad was “illegal” and not in accordance with the provisions of the India Independence Act. The UK court rejected this argument with two arguments – the princes and the President of India reached a settlement and secondly, the UK government acknowledged the accession of Hyderabad with India.

In conclusion, the UK court dismissed Pakistan claim on Hyderabad Nizam’s fund and recognised the claim of India and the grandsons of Nizam Mir Osman Ali Khan. The court left it to the Princes and India to divide the money among themselves.

In nutshell, Pakistan came out of the cold to shoot itself in foot and give India yet another sweet victory. The previous one for India was in the International Court of Justice (ICJ) which stayed execution of Kulbhushan Jadhav, the former Indian Navy officer, and ordered review of the judgment of a Pakistan military court.

The Indian victory must been sweeter for lawyer Harish Salve, who represented India in both the cases.

One Reply to “64 years, Rs 306 crore: How India won Hyderabad Nizam case against Pak”

  1. Thanks for another great article. Where else could anybody get that type of info in such an ideal way of writing? I’ve a presentation next week, and I’m on the look for such information.

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