On Mir Jafar's death Reza Khan became a part of the new political settlement between the Company in Bengal and the new Nawab. He was drawn also into the internal politics of rival factions among the Company's servants. This involvement was ultimately to prove dangerous, but in 1765 one party was to raise him to power, another to confirm him in what Hastings later called ‘the sovereignty of this province’.

Mir Jafar died at about noon on Tuesday, 5 February 1765, but he had already, on 29 January, seated Najm-ud-daulah, his eldest surviving son, on the masnad with all due ceremony. Shortly before his death, on the morning of 5 February, the old Nawab committed his son Najm-ud-daulah, the rest of the family and Nandkumar to the protection of the governor and Council in a letter to Spencer. In a postscript, perhaps added after Mir Jafar's death, Nandkumar, ‘your servant’ professed his attachment and obedience to the Company and asked for such kindness from them as he had received from the late Nawab. The Nawab had also sent for Middleton, but before the Resident was ready to go to the killah or fort the Nawab was reported dead and he then, accompanied by George Gray, Captain Stables and S. Droze, went to attend the installation ceremony of the new Nawab. There, as the Company's representative, he offered nazr to the Nawab as did the Jagat Seth and other leading citizens of Murshidabad.