The privy purses continued to be paid to the royal families until the 26th Amendment in 1971, by which all their privileges and allowances from the central government ceased to exist, which was implemented after a two-year legal battle.
Due to the diplomacy of Vallabhbhai Patel and V. P. Menon, Travancore, Bhopal and Jodhpur signed the instruments of accession before 15 August 1947.
The instruments of accession needed the states to only cede defence, communications and foreign relations to India.
[4] Dewan Jarmani Dass of Kapurthala says: Thus the rulers surrendered their sovereignty and as a quid pro quo they were granted handsome Privy Purses and other privileges.As defined from 1949 under Article 291 of the Indian Constitution, a privy purse would be a fixed, tax-free sum guaranteed to the former princely rulers and their successors.
The sum was intended to cover all expenses of the former ruling families, including those incurred for religious and other ceremonies, and would be charged on the Consolidated Fund of India.
[8] On 6 September 1970, the President of India passed an laconic order in respect of each of the rulers of former Indian states.
[1] The then Prime Minister Indira Gandhi argued for the abolition based on equal rights for all citizens and the need to reduce the government's revenue deficit.
Many of the former royalty tried to protest against the abolition of the privy purses, primarily through campaigns to contest seats in the Lok Sabha elections of 1971.