The Treaty of Allahabad was signed on August 16, 1765 between Mughal

Mughal Empire

The Mughal Empire ,‎ or Mogul Empire in traditional English usage, was an imperial power from the Indian Subcontinent. The Mughal emperors were descendants of the Timurids...

 Emperor Shah Alam II

Shah Alam II

Shah Alam II , also known as Ali Gauhar, was a Mughal emperor of India. A son of Alamgir II, he was exiled to Allahabad in December 1759 by Ghazi-ud-Din, who appointed Shah Jahan III as the emperor. Later, he was nominated as the emperor by Ahmad Shah.Shah Alam II was considered the only and...

 (son of late Emperor Alamgir II

Alamgir II

Aziz-ud-din Alamgir II was the Mughal Emperor of India from 3 June 1754 to 29 November 1759. He was the son of Jahandar Shah....

) and Lord Clive of the British East India Company

British East India Company

The East India Company was an early English joint-stock company that was formed initially for pursuing trade with the East Indies, but that ended up trading mainly with the Indian subcontinent and China...

 after the Battle of Buxar

Battle of Buxar

The Battle of Buxar was fought on 22 October 1764 between the forces under the command of the British East India Company, and the combined armies of Mir Qasim, the Nawab of Bengal; Shuja-ud-Daula Nawab of Awadh; and Shah Alam II, the Mughal Emperor...

 (22 Oct 1764). Based on the terms of the agreement, Shah Alam II

Shah Alam II

Shah Alam II , also known as Ali Gauhar, was a Mughal emperor of India. A son of Alamgir II, he was exiled to Allahabad in December 1759 by Ghazi-ud-Din, who appointed Shah Jahan III as the emperor. Later, he was nominated as the emperor by Ahmad Shah.Shah Alam II was considered the only and...

 granted Diwani rights or right to administer the territory and collect taxes to the East India Company. These rights allowed the Company to collect revenue from the people of Bengal

Bengal

Bengal is a historical and geographical region in the northeast region of the Indian Subcontinent at the apex of the Bay of Bengal. Today, it is mainly divided between the sovereign land of People's Republic of Bangladesh and the Indian state of West Bengal, although some regions of the previous...

, Bihar

Bihar

Bihar is a state in eastern India. It is the 12th largest state in terms of geographical size at and 3rd largest by population. Almost 58% of Biharis are below the age of 25, which is the highest proportion in India....

 and Orissa

Orissa

Orissa , officially Odisha since Nov 2011, is a state of India, located on the east coast of India, by the Bay of Bengal. It is the modern name of the ancient nation of Kalinga, which was invaded by the Maurya Emperor Ashoka in 261 BC. The modern state of Orissa was established on 1 April...

. In return, the Company gave an annual tribute of 2.6 million rupees (260,000 British pounds) while securing for Shah Alam II the districts of Kora and Allahabad

Allahabad

Allahabad , or Settled by God in Persian, is a major city of India and is one of the main holy cities of Hinduism. It was renamed by the Mughals from the ancient name of Prayaga , and is by some accounts the second-oldest city in India. It is located in the north Indian state of Uttar Pradesh,...

. The tribute money paid to the emperor was for the maintenance of the court of Allahabad

Allahabad

Allahabad , or Settled by God in Persian, is a major city of India and is one of the main holy cities of Hinduism. It was renamed by the Mughals from the ancient name of Prayaga , and is by some accounts the second-oldest city in India. It is located in the north Indian state of Uttar Pradesh,...

. The accord also dictated that Shah Alam II

Shah Alam II

Shah Alam II , also known as Ali Gauhar, was a Mughal emperor of India. A son of Alamgir II, he was exiled to Allahabad in December 1759 by Ghazi-ud-Din, who appointed Shah Jahan III as the emperor. Later, he was nominated as the emperor by Ahmad Shah.Shah Alam II was considered the only and...

 restore to Balwant Singh the province of Varanasi

Varanasi

-Etymology:The name Varanasi has its origin possibly from the names of the two rivers Varuna and Assi, for the old city lies in the north shores of the Ganga bounded by its two tributaries, the Varuna and the Asi, with the Ganges being to its south...

 as long as Balwant Singh continued to pay revenue to the Company. Awadh

Awadh

Awadh , also known in various British historical texts as Oudh or Oude derived from Ayodhya, is a region in the centre of the modern Indian state of Uttar Pradesh, which was before independence known as the United Provinces of Agra and Oudh...

 was returned to Shuja-ud-Daulah

Shuja-ud-Daula

Shuja-ud-Daula was the Subedar Nawab of Oudh from 5 October 1754 to 26 January 1775, and the son of Muhammad Nasir.Though a minor royal, he is best known for his key roles in two definitive battles in Indian history - the Third Battle of Panipat which ended Maratha domination of India, and the...

 but Allahabad

Allahabad

Allahabad , or Settled by God in Persian, is a major city of India and is one of the main holy cities of Hinduism. It was renamed by the Mughals from the ancient name of Prayaga , and is by some accounts the second-oldest city in India. It is located in the north Indian state of Uttar Pradesh,...

 and Kora was taken from him. The Nawab of Awadh

Nawab of Awadh

The Nawab of Awadh is the title of rulers who governed the state of Awadh in India in the 18th and 19th century. The Nawabs of Awadh originated form Persia-Establishment:...

also had to pay 53 Lakhs rupees of war indemnity to the British.