It should also be taken for consideration that the Asaf Jahi administration inherited an autocratic form of government as a legacy from the Mughals. Under Asaf Jah I's successors the autocracy of the Rulers was tempered by the Diwan whose authority was absolute so long as he retained the confidence of the British Resident. Although, during the Regency covering the minority of Mir Mahboob Ali Khan, Sir Salar Jung I replaced the absolutism of the Diwan by a constitutional Monarchy, the credit for curtailing the powers of the Diwan and restoring the Nizam's right of supervision goes to Mir Mahboob Ali Khan.
To enable the Nizam to supervise the administration more effectively, a proviso was made in the Qanuncha for the appointment of a Private Secretary to His Highness. But the Government warned the Nizam that the Private Secretary must not intervene between the Ruler and his responsible Minister, or usurp functions which properly belonged to the latter. Even under the new scheme of the Cabinet Council in which sub Ministers carrying responsibility were associated with the Minister in the conduct of the administration, his powers in relation to the sub Ministers individually, and to the Cabinet as a body, were not adversely affected. He still remained the central figure in the administration. Thus in the first meeting of the Cabinet Council on 30 September 1907 the Minister was referred to by one of the sub-Ministers as the source towards which the people turned for justice for their rights. He presided over the meetings of the Cabinet Council; he could withhold from the Cabinet any business which in the interest of the State he had submitted direct to His Highness for consideration; he could on his own responsibility overrule any decision of the Cabinet Council and might issue necessary orders provided that he recorded his reasons in writing, appended them to the proceedings of the Cabinet Council, and made immediate report to his action to the Nizam. Similarly, the Legislative Council was created to prepare, with His Highness's final sanction, laws and regulations for the conduct of the business of administration in all the departments of the State. This Council served a useful purpose by remedying a serious deficiency found in all the departments of the State because laws or rules for the guidance of the public and the officials were either non-existent or were of a most fragmentary character.
Regarding the judiciary, it was proposed in the new scheme that a judicial committee on the model of the judicial committee of the Privy Council in England was to be established to hear appeals from the High Court. But in this field the Qanuncha failed to achieve its objective. Moreover, during Mir Mahboob Ali Khan's period, the Resident was more than satisfied with the general rate of progress in the administration. It was noticed that from the executive point of view, the prospect at Hyderabad was more hopeful than it had been from years past. It revealed a great advance in ideas. As per the history, Nawab Mir Mahboob Ali Khan though only 42 years old had been ruler of Hyderabad for the last quarter of a century, had expert experience of administration and due to his personal interest in the administration there had been outstanding progress.
Mir Mahboob Ali Khan's period coincided with the emergence of a new generation of Indian Princes who had had liberal Western education imparted at institutions like Mayo College at Ajmer and Daly College at Indore. The Sixth Nizam belonged to this new generation because of the breadth of his education, directed both by an eminent Orientalist like Moulvi Anwarulla and by an able English tutor, Captain John Clerk. This accounted for his enlightened outlook. While the modernisation of the Hyderabad administration is popularly associated with the name of the great Sir Salar Jung I, it was in fact the personal regime of Mir Mahboob Ali Khan which ushered in a new epoch in constitutional growth, later to assume such significance during Mir Osman Ali Khan's period. The Nizam hardly realised that in issuing the Qanuncha-e-Mubarak he was creating a constitutional framework for the Executive, the Legislature and the Judiciary, the outstanding features of the new system were the institution of the Cabinet Council in place of the old Council of State, and a Legislative Council for making laws.
Mir Mahboob Ali Khan's regime marked an important stage in the process, which led later to the establishment of the Chamber of Princes and the conception of a Federal Polity for India. The policy of enabling Indians to join the administration of the country was started under Lord Ripon; but the idea of seeking the cooperation of the Indian Princes in the task was developed under Lord Curzon because of the pressure of the nascent Indian Nationalism, which became vocal from the time of the establishment of the Indian National Congress in 1885. The movement had its repercussions on the Indian States, including Hyderabad. Syed Hussain Bilgrami Nawab Imadul Mulk in his pamphlet 'The Present unrest in India' noted that agitators not only went preaching seditious sentiments from village to village, impressing on the simple country folk the oppressive character of the British Rule, but they also reminded them of the contrast with the happy times of the Swarajya and the Peshwas.
This rising tide of Indian Nationalism brought to the forefront a middle class, educated elite who had hitherto been subordinate to the old aristocracy. These new men were making loud demands for an adequate share in the government of the country and were hostile to the British Government. It was to counter balance them that the Government planned to build up a strong Princely order. Lord Curzon established a precedent by seeking the cooperation of the Princes in the general administration of the country.
The collaboration of the Indian Princes was primarily sought in order to buttress the British Empire in India by their staunch loyalty to the British Crown. The idea of a political union between the Paramount power and the Feudatory Princes, in the mutual interest of both the parties, was first referred to by Curzon on the occasion of the enhancement of the powers of the Maharaja of Kashmir. This political union gained strength with the spread of the national agitation to many of the Indian States.
Although the Nizam had limited knowledge of the other Indian States, because Hyderabad had no direct relations with them, he was instrumental in further developing the idea of collaboration between them. He also carried the proposition of the Paramount power by indicating to the Governor General that it would be in the general interest of the country if the Indian States were to be consulted not only in matters directly affecting them, but also in matters affecting the general interests of the Empire as well. The Nizam, at the same time he had the courage to make it clear to the Governor General that in dealing with a matter like sedition the combined policies of repression and conciliation should go hand in hand. The Nizam observed that while sedition should be localized and rooted out sternly and even mercilessly, deep sympathy and unreserved reliance should manifest themselves in all dealings with loyal subjects without distinction of creed, caste or colour.
The effective working of this policy of combining repression and conciliation was shown when an intrigue was mounted by the Secretary of the Nizam's Cabinet Council against a responsible British Officer of the Hyderabad Government. He refused to issue any general promulgation against seditious agitation because he did not want to create a panic amongst the people when there was no likelihood of a seditious agitation breaking out in the State. Moreover, His Highness was the believer of that fact that the only effective way of fighting sedition was to associate Indians with the working of the administration. The promises made in the Queen's proclamation of 1858 and reaffirmed in the King Emperor's message to the Princes and peoples of India in 1908 were implemented by appointing an Indian member to the Governor General's Council, and two Indians as members of the Council of the Secretary of State.
Further, the Nizam stated that this same principle of equality of opportunity to all, irrespective of caste, creed or religion had been his own maxim as well. Thus, in Mir Mahboob Ali Khan's opinion the general contentment of the people as a whole was the only effective remedy for eradicating sedition from the country. His deep concern for the welfare of his people, and his determination to acquaint himself with their feelings were perhaps best illustrated by his habit of making regular rounds of the city while disguised as an ordinary man to know the regular emotions and realise the condition of the common people. His attitude towards his coreligionists and Hindu subjects is conscientiously equibalanced Hindus and Muslims, Parsis and Christians.
Mir Mahboob Ali Khan's character, his zeal for reforms in every aspect of his administration, and his ardent and selfless devotion to the cause of his peoples, would have made him the ideal Indian Ruler for the successful working of the Federal polity of India. The official records, private papers and press reports about him testify to his sagacity and greatness as a Ruler at a time when India stood at the threshold of a Revolution which was going to change her destiny from that of a servile to that of a free nation. He was a successful ruler, who was certainly far superior to any of his predecessors, a kind and considerate master, whose natural quickness of intellect and knowledge of public affairs excited admiration. His subjects are generally indebted to him for many acts of Princely generosity, and ever regarded him with genuine reverence and almost filial affection. So much so that since his death he has been canonised as a Saint and his tomb has become a place of pilgrimage.