The CCS of Hyderabad Police registered a case against Hasan Ali Khan on charges of stealing Nizam's jewelry following a complaint by the Enforcement Directorate. Currently Hasan Ali is in jail on alleged money laundering charges. Others named in the FIR are his aides Kashinath Tapuriah, a Kolkata businessman, also in jail on charges of money laundering, Philip Anandraj, Nasir Baig, and Ram Bharoj Gupta, a Hyderabad based jewellery shop owner.

Investigators told that Hasan Ali had connived with Nasir Baig, the custodian of Salar Jung Museum, the third largest museum in the country where the alleged offence occurred, and others, to steal the antiques belonging to the family of the Nizams. Ali is believed to have smuggled the antiques abroad between late 1990s and early 2000. Officials said Ali met one Nasir Baig in Hyderabad who claimed to have the power of attorney of the Nizam's famous jewellery. The rights were later transferred to Ali who sold some jewellery to Singapore based businessmen.

However, dismissing the episode as gossip, Mr Nawab Ahtheram Ali Khan, a descendent of the Salar Jung family and board member of the Salar Jung Museum, said, "The accused must have fabricated the whole thing to divert the attention of the police. I belong to the family and I am convinced that the security is so tight that not even a pin can go out of the museum without being noticed." Mr Ahtheram Ali Khan, said he was sure that nobody by the name of Nasir Baig, ever worked as manager or custodian or in any capacity associated with museum or the Nizam's family.

The Salar Jung Museum authorities said that they are ready to present an inventory to the Central Crime Station Police and show that every object or artefact in the museum is in place. They also vehemently denied the possibility of any jewellery theft or alteration claiming that it is a ploy of the accused, Hasan Ali, to divert the attention of the police, and at the time of the so-called theft, the Nizam's jewellery was not even in the Hyderabad Museum but in the RBI vault. The director pointed out that the chronology of the theft claimed by Hasan Ali and the location of the jewels at that time don't match at all.