{"id":221495,"date":"2019-10-26T09:00:53","date_gmt":"2019-10-26T03:30:53","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=221495"},"modified":"2019-10-25T13:49:30","modified_gmt":"2019-10-25T08:19:30","slug":"uk-hc-indias-claim-to-1-mn-pounds-held-by-pakistan-through-their-high-commissioner-in-uk-on-trust-for-nizam-vii-and-his-successors-in-title-upheld","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2019\/10\/26\/uk-hc-indias-claim-to-1-mn-pounds-held-by-pakistan-through-their-high-commissioner-in-uk-on-trust-for-nizam-vii-and-his-successors-in-title-upheld\/","title":{"rendered":"UK HC | India\u2019s claim to 1 Mn Pounds held by Pakistan through their High Commissioner in UK on trust for Nizam VII and his successors in title, upheld"},"content":{"rendered":"<p style=\"text-align: justify;\"><b>The High Court of Justice<\/b>: Marcus Smith J., dismissed Pakistan&#8217;s claim over a sum of \u00a31,007,940 deposited in 1948 by the government of Hyderabad with the Pakistan High Commission in London. The Court ruled that \u201c<i>Nizam VII was beneficially entitled to the Fund and those claiming in right of Nizam VII.<\/i>\u201d<\/p>\n<p style=\"text-align: justify;\"><b>Facts:<\/b><\/p>\n<p style=\"text-align: justify;\">On 20 September 1948, Nawab Moin Nawaz Jung (Moin) caused the sum of \u00a31,007,940 to be transferred from an account of the Government of Hyderabad held at Westminster Bank (the Bank) to an account in the name of Habib Ibrahim Rahimtoola (Rahimtoola). Until 17-09-1948, Moin had been the Finance Minister and Minister for External Affairs for the Government of Hyderabad. His status post this date was under question and scrutiny in this Judgment. Rahimtoola at the time of the Transfer was the High Commissioner to the United Kingdom for the Islamic Republic of Pakistan (Pakistan).<span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\">This Fund was however paid into Court. A dispute as to the title of the Fund arose immediately. Initially, the dispute was between the ruler of Hyderabad, His Exalted Highness, the Seventh Nizam of Hyderabad (Nizam VII), and Pakistan. That dispute resulted in proceedings commenced in the Chancery Division of the High Court of Justice (the 1954 Proceedings). The claim was brought by Nizam VII and Hyderabad as plaintiffs against Moin, the Bank and Rahimtoola as defendants. Early in the course of the 1954 Proceedings, Pakistan asserted sovereign immunity.<span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><b>Procedural History:<\/b><\/p>\n<p style=\"text-align: justify;\">The 1954 Proceedings were stayed against the Bank, and set aside against Rahimtoola, by order of the House of Lords on grounds of Pakistan\u2019s successful assertion of sovereign immunity. Pakistan asserted sovereign immunity by reason of the fact that Rahimtoola held the Fund as High Commissioner of Pakistan and that the claim brought by the plaintiffs directly or indirectly infringed Pakistan\u2019s sovereign immunity. Although at no time in these proceedings did Pakistan assert any beneficial interest in the Fund. The House of Lords held (upholding Upjohn J. at first instance and overruling the Court of Appeal) that Pakistan\u2019s bare legal title in the Fund, through Rahimtoola as High Commissioner, was sufficient to enable her to assert soverign immunity.<\/p>\n<p style=\"text-align: justify;\">In 1963, Nizam VII created a trust over his interest in the Fund (the 1963 Settlement) and in 1965 the capital and income of the 1963 Settlement were irrevocably appointed upon trust for his grandsons \u2013 Nizam VIII and Prince Muffakham (Princes).<span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\">In 2013, Pakistan commenced the present proceedings. These were against the Bank for payment of the Fund to Pakistan. This involved \u2013 for the first time in legal proceedings \u2013 an assertion by Pakistan of a beneficial interest in the Fund. The Princes and India were joined to the proceedings. The Bank interpleaded; stated that it claimed no interest in the Fund for itself and that it would pay the Fund to whoever the Court determined was entitled to it. Pakistan having waived her sovereign immunity in commencing the proceedings, there was now an opportunity for the ownership of the Fund to be determined.<\/p>\n<p style=\"text-align: justify;\"><b>Issue:<\/b><\/p>\n<p style=\"text-align: justify;\">The main question before the Court was whether it was Pakistan or the late Nizam VII who was, in 1948, entitled to the Fund?<\/p>\n<p style=\"text-align: justify;\"><b>Contentions by the parties:<\/b><\/p>\n<p style=\"text-align: justify;\"><i>a. Pakistan\u2019s claims to be absolutely entitled to the Fund<\/i>:<\/p>\n<p style=\"text-align: justify;\">Pakistan claims an absolute entitlement to the Fund on two alternative bases:<\/p>\n<ul style=\"text-align: justify;\">\n<li>The monies were transferred to compensate\/reimburse\/indemnify Pakistan for assistance provided by her in procuring\/facilitating the supply and\/or transportation of weapons.<span class=\"Apple-converted-space\">\u00a0<\/span><\/li>\n<li>The monies were transferred in order to keep the Fund out of the hands of India. It was Pakistan\u2019s case that if there had been a legal obligation on Pakistan to return the Fund on Nizam VII\u2019s demand, the Fund would not be safeguarded from India because India would force Nizam VII to demand the return of the Fund.<\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><i>b. The Princes\u2019 and India\u2019s contentions that the Fund was held on trust<\/i>:<\/p>\n<p style=\"text-align: justify;\">The Princes and India disputed Pakistan\u2019s claim to be absolutely entitled to the Fund. They contended that there was no absolute transfer to Pakistan but that Nizam VII retained the beneficial interest in the Fund and that a trust arose. The Princes and India also said that the transfer was to Rahimtoola in his personal capacity and that Pakistan had no interest \u2013 not even a legal interest \u2013 in the Fund. In short, the Princes and India asserted that the fund was held on trust by Rahimtoola in his personal capacity alternatively in his capacity as High Commissioner.<\/p>\n<p style=\"text-align: justify;\"><i>c. The restitutionary claim:<\/i><\/p>\n<p style=\"text-align: justify;\">The Princes and India made a claim in restitution against both Pakistan and the Bank contending that the Transfer was unauthorised and that this lack of authority provided the basis for a claim in restitution or unjust enrichment.<\/p>\n<p style=\"text-align: justify;\"><i>d. Foreign act of state and non-justiciability:<\/i><\/p>\n<p style=\"text-align: justify;\">Pakistan contended that the facts of this case were such as to render it non-justiciable in whole or in part.<\/p>\n<p style=\"text-align: justify;\"><b>Analysis:<\/b><\/p>\n<p style=\"text-align: justify;\">The Fund was held by Pakistan through her High Commissioner in the United Kingdom on trust for Nizam VII and his successors in title. The Fund was not held by Rahimtoola personally, nor did either Pakistan or Rahimtoola have any beneficial interest in the Fund. The trust was either a constructive trust in favour of Nizam VII or a resulting trust in favour of Nizam VII. It was not an express trust because the that Nizam VII did not communicate to Moin any authority to effect the Transfer and create a trust. However, Moin\u2019s conduct was consistent with the unexpressed wishes of Nizam VII. Both Moin and Rahimtoola intended that an express trust should arise and \u2013 had there been communication of authority by Nizam VII to Moin \u2013 an express trust would have arisen.<\/p>\n<p style=\"text-align: justify;\">There is nothing in the involvement of Pakistan, India, Hyderabad or Nizam VII as sovereign states or rulers of sovereign states to prevent a trust (whether express, constructive or resulting) from arising.<\/p>\n<p style=\"text-align: justify;\">The Court deemed it unnecessary to determine whether it is the Princes or India that is Nizam VII\u2019s successor in title, whether by virtue of the 1963 Settlement and 1965 Appointment (in the case of the Princes) or the 1965 Assignment (in the case of India) given the Settlement reached as between the Princes and India. However, it is appropriate to record that the Nizam\u2019s successor in the title can be no-one other than the Princes or India. The administrator of Nizam VII\u2019s estate (Mr Lintott) was a party to these proceedings and was given every opportunity to bring a rival claim to those of the Princes and India: he did not do and is bound by the outcome of these proceedings. During the course of these proceedings, the Court did not see any hint of the possibility of any further claimant to the Fund, beyond the Princes and India.<\/p>\n<p style=\"text-align: justify;\">The Princes\u2019 and India\u2019s alternative claims in restitution succeed against (i) Pakistan and (ii) in the alternative, the Bank. Pakistan\u2019s assertion of a defence of limitation is an abuse of the process of the court and order that the paragraphs in Pakistan\u2019s statements of case asserting this defence be struck out. The Bank never pleaded a defence of limitation, and therefore a claim in restitution is properly maintainable against the Bank.<\/p>\n<p style=\"text-align: justify;\">Pakistan\u2019s contentions of non-justiciability by reason of the foreign act of state doctrine and non-enforceability on grounds of illegality both fail.<\/p>\n<p style=\"text-align: justify;\">In these circumstances, Nizam VII was beneficially entitled to the Fund and those claiming in right of Nizam VII \u2013 the Princes and India \u2013 were entitled to have the sum paid out to their order.<span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><b>Conclusion:<\/b><\/p>\n<ul style=\"text-align: justify;\">\n<li>India was correct in asserting that the question of illegality was \u201canalytically irrelevant\u201d to the claim to the Fund advanced by India.<\/li>\n<li>Even if the question of illegality were relevant to India\u2019s claims, the Settlement between the Princes and India had rendered the issue irrelevant because the rival claims to the Fund of the Princes and India had validly been compromised, such that the question of illegality was no longer before the Court.<\/li>\n<li>There was no illegality alleged that would be sufficient to cause this Court to prevent the Princes and India \u2013 specifically, India \u2013 from asserting their claim to the Fund. [Pakistan v. India, [2019] EWHC 2551 (Ch), decided on 02-10-2019]<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>The High Court of Justice: Marcus Smith J., dismissed Pakistan&#8217;s claim over a sum of \u00a31,007,940 deposited in 1948 by the government <\/p>\n","protected":false},"author":8808,"featured_media":163204,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,12],"tags":[38055,38054],"class_list":["post-221495","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-foreigncourts","tag-government-of-hyderabad","tag-nizam-fund"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.4 (Yoast SEO v26.4) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>UK HC | India\u2019s claim to 1 Mn Pounds held by Pakistan through their High Commissioner in UK 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Sarma as new Vice Chancellor","author":"Bhumika Indulia","date":"September 2, 2019","format":false,"excerpt":"Reported by Simranjeet Kaur","rel":"","context":"In &quot;Law School News&quot;","block_context":{"text":"Law School News","link":"https:\/\/www.scconline.com\/blog\/post\/category\/lawschoolnews\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2019\/09\/Prof.-Dr.-K.V.S.-Sarma.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2019\/09\/Prof.-Dr.-K.V.S.-Sarma.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2019\/09\/Prof.-Dr.-K.V.S.-Sarma.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2019\/09\/Prof.-Dr.-K.V.S.-Sarma.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2019\/09\/Prof.-Dr.-K.V.S.-Sarma.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":240727,"url":"https:\/\/www.scconline.com\/blog\/post\/2020\/12\/17\/call-for-response-pieces-citizenship-residency-and-the-constitution\/","url_meta":{"origin":221495,"position":2},"title":"Call for Response Pieces | Citizenship, Residency and the Constitution","author":"Bhumika Indulia","date":"December 17, 2020","format":false,"excerpt":"Reported by Mansi Meena","rel":"","context":"In &quot;Law School News&quot;","block_context":{"text":"Law School News","link":"https:\/\/www.scconline.com\/blog\/post\/category\/lawschoolnews\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2020\/12\/Laot.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2020\/12\/Laot.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2020\/12\/Laot.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2020\/12\/Laot.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2020\/12\/Laot.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":295762,"url":"https:\/\/www.scconline.com\/blog\/post\/2023\/07\/01\/not-entitled-to-any-exclusion-of-time-under-s14or-s15-limitationact1908-claim-for-rusum-i-deskmukhi\/","url_meta":{"origin":221495,"position":3},"title":"Never Reported Judgment| Supreme Court on Valuation of Fee\/Perquisites vis-\u00e0-vis exclusion of time under Section 14 or 15 of the Limitation Act [1950 SCC 1034]","author":"Simranjeet","date":"July 1, 2023","format":false,"excerpt":"This report covers the Supreme Court's Never Reported Judgment dating back to the year 1950 on Hyderabad Limitation Act, 1322 Fasli and Sections 14 and 15 of the Limitation Act, 1908.","rel":"","context":"In &quot;Cases Reported&quot;","block_context":{"text":"Cases Reported","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casesreported\/"},"img":{"alt_text":"limitation","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/07\/limitation.webp?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/07\/limitation.webp?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/07\/limitation.webp?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/07\/limitation.webp?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":152844,"url":"https:\/\/www.scconline.com\/blog\/post\/2017\/08\/29\/hyderabad-hc-dismisses-writ-petition-challenging-the-appointment-of-chief-minister\/","url_meta":{"origin":221495,"position":4},"title":"Hyderabad HC dismisses writ petition challenging the appointment of Chief Minister","author":"Saba","date":"August 29, 2017","format":false,"excerpt":"Hyderabad High Court: The Court dismissed a writ petition seeking a writ of quo warranto against the respondent to show cause of his authority in holding the office of the Chief Minister of the State of Andhra Pradesh. The case of the petitioner is that proper statutory guidelines have not\u2026","rel":"","context":"In &quot;Case Briefs&quot;","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":206856,"url":"https:\/\/www.scconline.com\/blog\/post\/2018\/12\/15\/landlord-not-entitled-to-claim-damages-after-termination-of-tenancy-if-he-fails-to-take-steps-for-recovery-of-possession\/","url_meta":{"origin":221495,"position":5},"title":"Landlord not entitled to claim damages after termination of tenancy if he fails to take steps for recovery of possession","author":"Bhumika Indulia","date":"December 15, 2018","format":false,"excerpt":"Bombay High Court:\u00a0A Single Judge Bench comprising of A.M. Dhavale, J. dismissed a second appeal filed against the order made in first appeal wherein it was held that the plaintiffs were not entitled to claim damages for wrongful possession of rented premises by the defendant. 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