JUDGMENT

MOHAN, J.: ( By this intervention application the intervenors seek to:

(i) restrain the Union of India from making any payment of the amount of Rs. 180 crores to the Nizam of Hydrabad for the purchase of the Jacob Diamond and other priceless jewels which, according to him, are State property;

(ii) in the alternative to direct the recipients of the said sum of Rs. 180 crores to deposit in a separate Bank account or in fixed deposit;

(iii) to appoint a Commission to investigate into the true ownership of the Jacob Diamond and the other priceless jewels claimed to be the private property of the Nizam of Hydrabad, and if found to State property the Union of India should acquire and take possession of the same without any payment whatsoever;

(iv) declare the Jacob Diamond as private property of Nizam of Hyderabad, as State property;

(v) declare the priceless jewels as Regalia and antiquities and art treasures.

2. The main dispute relates to the jewels belonging to the two Trusts, namely HEH The Nizams Jewelry Trust and HEH The Nizams Supplementary Jewellery Trust. The writ petitions and the connected civil appeals were disposed of by an order dated 25th April, 1989 referring the same to arbitration. There was a divergence of opinion between the two arbitrators and the matter was referred to Mr. Justice A.N.Sen as the Umpire. He rendered an Award that the Government of India would pay a sum of Rupees 225,37,33,959/-. This amount was reduced by Rs. 45 crores since there was a typographical error with reference to Item 33 of the Schedule of Valuation of the Award. As a result, the liability of the Union of India to purchase 173 items of jewellery comprised in the two Trusts came to Rs. 180,37,33,959/.

3. The Award dated 27-7-1991, was submitted to this Court for appropriate orders. The parties had the notice of the filing of the Award. The Award was not implemented and the Union of India, filed I.A. No.8 of 1991 on 29-8-1991, being a petition under Section 15/16 of the Arbitration Act, 1940, questioning the validity and correctness of the Award. The following prayers were made in the said I.A.:

"(i) Set aside the Award of the learned Umpire dated 27th July, 1991 and remit the same back to him for a fresh determination of the values;

(ii) Stay the operation of the Award of the learned Umpire till the disposal of this petition.

4. The Trustee also filed a petition under Section 15/16 of the Arbitration Act, 1940, being I.A. No. 9 of 1991 on 6-9-1991. Relief prayed for in the said I.A. is reproduced inter alia:

"Remit the Award of the Honble Umpire dated 27th July, 1991 for reconsideration under Section 16 of the Arbitration Act on the ground submitted herein."

5. Pending adjudication of these interlocutory applications the present application for intervention, being I.A. No.10 of 1993, has been preferred on August 10, 1993 praying for the grant of relief as extracted above. By an order of this Court dated 10-2-1994 the said application was dismissed stating that the reasons would be recorded and furnished later. We herebelow give the reasons:

The intervenors claiming to be public spirited citizens would urge that there was a clear conceptual division between the Nizams personal and private property and the State property. The Jacob Diamond which the Union of India is offering to purchase is the property of the State of Hyderabad. In support of this statement, certain documents are relied on.

6. There are other pricelss jewels which constitute Regalia and, therefore, they are State jewels. The sons and successors of Nizam cannot claim such Regalia as the private property merely because they were inherited as heirlooms. As a matter of fact, the Nizam requested the Central Board of Revenue to accord recognition to the articles of jewellery, as his heirloom under Wealth tax of Hairloom Jewellery of Rulers, 1958 for the purposes of clause (xiv) of sub-section (1) of Section 5 of the Wealth-tax Act, 1957. Notwithstanding the above, these items wer