When he arrived, Baba informed him, "If you find a better guru than me in the Himalayas, you may go; otherwise, come and stay with me."

Savak was only waiting to hear these words. He had wanted to stay with Baba for a long time, and his threat of going off to the mountains was only to force Baba to allow him to come. He returned to Bombay and, with his wife Nergiz, three children Najoo, Hilla and Adi, and Nergiz's paternal aunt Banubai Lakdawala came to Bangalore on 15 March 1940 to join Baba's ashram permanently.

Before coming to Baba, the Kotwals sold all their possessions. Nergiz was from a very wealthy family, and her relatives were shocked when they discovered what she was doing. When the Kotwals arrived in Bangalore, Savak handed Baba an envelope containing the family's entire finances. He also gave Baba a box containing all of Nergiz's jewelry. Baba was very pleased and remarked to Savak, "From today until the very end, I shall see to every one of your family's smallest needs, and to you I shall give the Ocean!"

Soon after, Nergiz fell ill, and Nadine was assigned the duty of nursing her. When she recovered, Baba asked her, "What do you think now? Savak has left his job; he is unemployed. You have sold all your property and now have no money. Aren't you worried?"

"I now belong to you, Baba," she said. "Be gracious enough to accept myself and my children in your service."

Baba smiled and said, "From today your responsibility is mine. I will look after you all till the end!"

Some days later (on 31 March), Baba sent the Kotwal family to Panchgani. When Baba returned to Meherabad, they joined him there. Najoo and Hilla would sometimes be called upon to sing for Baba, and little Adi often made Baba laugh with his jokes and funny songs.

A meeting between Hitler and Mussolini took place on 18 March 1940. The next day, Baba called a meeting of the mandali and stated again:

Something sudden and serious is going to happen in regards to the war. Mussolini and Hitler are coming together. That is a result of my working. The two of them are good-for-nothing fellows — whereas my mandali are "good-for-everything"! I am working through [Mussolini and Hitler]. Either there will be a bloody war or peace, because due to the coalition of these two, all nations will feel themselves very insecure for their safety.

Baba also commented:

No one will ever know what transpired between these two, not even their closest and most confidential lieutenants and associates. It is a most private arrangement between the two, too delicate and confidential even for their confederates and ministers. It will only be known to the world when the actual events [of what they decided] take place, and will create no small surprise to the world.

Even these two, who are so much in confidence with one another, are both bluffing each other and playing their own games — and the fun of it is that they both know it. What complications these [plans] will create, they themselves have no idea. Such is the game played for self-interest, lust and greed. See it all and mark my words.