LONDON, Oct 2 - In a major setback for Pakistan, the UK High Court on Wednesday ruled in favour of India in a decades-old legal dispute with Islamabad over funds belonging to the Nizam of Hyderabad at the time of Partition in 1947 and deposited in a London bank account.
The Nizam�s descendants, Prince Mukarram Jah � the titular eighth Nizam of Hyderabad � and his younger brother Muffakham Jah, had joined hands with the Indian government in the legal battle against the Pakistan government over around 35 million pounds lying with NatWest Bank plc here.
In his judgement handed down at the Royal Courts of Justice in London, Justice Marcus Smith ruled that the �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�.
The verdict noted that �Pakistan�s contentions of non-justiciability by reason of the foreign act of state doctrine and non-enforceability on grounds of illegality both fail.�
The dispute revolves around 1,007,940 pounds and nine shillings transferred in 1948 from the then Nizam of Hyderabad to the high commissioner in Britain of the newly-formed state of Pakistan. That amount has since grown into 35 million pounds as the Nizam�s descendants, supported by India, claimed it belongs to them and Pakistan counter-claimed that it is rightfully theirs.
�We are delighted that today�s judgement recognises His Exalted Highness the VIII Nizam�s rights to funds which have been in dispute since 1948. Our client was still a child when the dispute first arose and is now in his 80s. It is a great relief to see this dispute finally resolved in his lifetime,� said Paul Hewitt, partner in Withers LLP, who have acted for the VIII Nizam since Pakistan issued proceedings in 2013.
�Justice Smith�s judgement covers a complex historical and legal set of issues, interpreting facts and events that occurred 70 years ago to establish that the funds, which now amount to 35 million, were always held in trust for our client�s grandfather, the VII Nizam. The judgement also makes important findings on justiciability� and whether a nation state can be a trustee,� he said.
In 2013, Pakistan had waived sovereign immunity by issuing a claim for the fund that opened the way for the current case to proceed. The Pakistan government�s legal team had claimed the fund on two alternative bases.
One, referred to as the �Arms for Money Argument�, claimed that funds were transferred to compensate/reimburse/indemnify Pakistan for assistance provided in procuring/facilitating the supply and/or transportation of weapons. The second ground was that the funds were transferred in order to keep them out of the hands of India, referred to by the judge as the �Safeguarding Argument�.
Meanwhile, commenting on the ruling, the Pakistan Foreign Office in Islamabad said it would take further action after examining the detailed judgement. �Pakistan is closely examining all aspects of the detailed judgement and will take further action in light of legal advice received,� the FO said.
It also said that the ruling failed to take into account the historical context of the transfer when �India illegally annexed Hyderabad...� However, the FO did not specify the actions Pakistan was contemplating against the decisions. � PTI