Family of Indian royals wins £35m court battle against Pakistan

Wednesday 02nd October 2019 11:00 EDT
 
 

The High Court of England and Wales upheld the claims of India and two descendants of the late 7th Nizam of Hyderabad in the 70 years old £35 million fund that is being held by the National Westminster Bank in London. The Fund had been held in the account of the High Commissioner of Pakistan to the UK Rahimtoola since September 1948. Pakistan had claimed that the money was a payment for arms supplied to the Hyderabad state during India’s annexation in 1948. The 7th Nizam had transferred the £1 million, now estimated at least £35 million, to the then Pakistan ambassador in London, Habib Ibrahim Rahimtoola, for safe-keeping, who agreed “to keep the amount mentioned by you in my name in trust.”

In 2013, Pakistan commenced fresh proceedings herself, thereby waiving state immunity. A subsequent attempt by Pakistan to discontinue the proceedings was rejected as an abuse of process by the UK Court. The 166-page judgment ruled out by Justice Marcus Smith sets out the history of the dispute, from India’s ‘Operation Polo’ to annex Hyderabad, and later developments that include the Nizam in 1965 ‘assigning’ the President of India the claim to the money in London. In the judgment, the UK High Court has rejected Pakistan's claim that the fund had been intended as payment for arms shipments or as an outright gift. The court has held that beneficial ownership in the fund as at 1948 lay with the 7th Nizam, and that it had been held on trust to his benefit and that of his successors in title since then.

The judge said: “Although the Government of Hyderabad was involved in the purchase of weapons in order to resist what Nizam VII saw as attempts by India forcibly to annex Hyderabad, and although the Second Account was used to pay for some of these weapons, I do not consider that the transfer had anything to do with the purchase of weapons or the compensation of Pakistan (in any way) for the purchase of weapons”.

“(It) is appropriate to record that the Nizam’s successor in title can be no-one other than the Princes or India…I have seen no hint of the possibility of any further claimant to the fund, beyond the Princes and India. “In these circumstances, Nizam VII was beneficially entitled to the fund and those claiming in right of Nizam VII - the Princes and India – are entitled to have the sum paid out to their order. I will leave it to the parties to frame an appropriate form of order for my approval”.

"We welcome the judgment," Najaf Ali Khan, one of the Nizam's grandsons said. "The High Court has rightly rejected Pakistan's claim. The family has long awaited this judgment." India's foreign ministry also hailed the verdict. Pakistan could seek to appeal, but otherwise the money will be given to the Nizam's grandsons and the state of India.


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