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Nizam's family to protest over Rs 9 cr tax demand

Hyderabad, March 10 - Fed up with alleged harassment by the income tax department, members of the family of the erstwhile Nizam of Hyderabad are planning protests in Delhi during the budget session of parliament starting next week.

At the centre of the row is Rs.8.99 crore ($1.8 million) tax dues being demanded by the income tax department from 120 family members who were beneficiaries of the proceeds from the sale of the fabulous jewellery of seventh Nizam Mir Osman Ali Khan, said to be the richest man of his time.

The Indian government had acquired the jewellery for Rs.206 crore in 1995.

With their repeated representations, including one to Finance Minister Pranab Mukherjee, failing to yield results, the descendants of the seventh and last ruler of the erstwhile princely state of Hyderabad want to take the issue to the national capital.

"The way we are being tortured, it hurts me like anything. Now I am fed up with all their tricks. The parliament session is starting now. Let the people in Delhi see how the Nizam's family is being taken care of by the income tax department," the Nizam's grandson, Nawab Najaf Ali Khan, told IANS.

While the department continues to send notices for Rs.8.99 crore, the Nizam's family members claim they have paid all the taxes till 1995 and are ready for reconciliation in case there are any arrears. They, however, reject the figure of Rs.8.99 crore as inflated.

"Fifteen years have passed. Will this litigation go on lifelong?" asked Najaf, who is president of the Nizam Family Welfare Association.

"It is a deliberate attempt not to give a refund to the family. If you set the house in order, the matter can be solved in one day," he said.

Giving a detailed account of the dispute, he said the tax department raised a total demand of Rs.30.50 crore towards income tax and wealth tax in 1995. The family paid Rs.15.45 crore as arrears for 1992-93 and another Rs.15.05 crore was kept as a lien under the department in a bank.

The IT department released refunds of Rs.4.39 crore to the family in 2004 and another Rs.66 lakh in 2006. This left Rs.8.66 crore in the bank, which remains under lien pending final settlement.

It was in 2006 that the department sent a notice demanding Rs.8.99 crore tax arrears.

"My question is simple. Why did you release the amount (from the lien) when there were tax arrears?" asked Najaf.

Terming the tax demand as inflated, the family moved the Andhra Pradesh High Court, which directed in August 2006 that all matters relating to the case be resolved in eight weeks.

"Initially they (the department) started reconciliation in five cases in which they had shown tax arrears in the court but they ended up paying refund in three of these cases and hence stopped the process," claimed Najaf.

The family has once again dragged the tax department to the high court by filing a contempt of court petition as court orders were not implemented even after five and a half years.

Najaf claims even his meeting with the finance minister himself in August 2010 failed to yield any results as the income tax authorities never sent a report to the Central Board of Direct Taxes (CBDT) as directed by Mukherjee.

Najaf, 47, said most of the family members are elderly people, suffering from various ailments. "Some are in a distressed condition and don't even have money for their livelihood," he said.

"We don't want any favour from the income tax department or help from anybody. We only want the law to be made applicable so that justice is done to us," adds the scion of the royal family.

The seventh Nizam had 16 sons and 18 daughters, and of them two sons and three daughters are still alive. There are a total of 104 grandchildren.

(Mohammed Shafeeq can be contacted at


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