The 1960 film beat Akbar Khan's "Taj Mahal - An Eternal Love Story", another Mughal historical saga on Emperor Shahjehan's love for wife Mumtaz Mahal, which is expected to hit theatres in Pakistan April 28.
"When my father's film was originally released in 1960 it broke all records, and now almost 50 years later it is helping to build a bridge of peace between the two countries - India and Pakistan. It is also opening the door for Bollywood in Pakistan," said K. Asif's son, Akbar Asif, after the premiere here.
Akbar Asif, a London-based tycoon, had earlier gifted a print of the film to Pakistan President Pervez Musharraf when he was visiting Britain, according to a release.
He had initially planned a gala premiere for the film but dropped the idea at the last minute so more money could be donated to victims of last year's earthquake.
"The thought struck me a few days ago that a film of the epic nature of 'Mughal-E-Azam' needs no grandiose pre-publicity in terms of release because it has iconic status in the hearts of generations of film fans and we also wanted maximum profits to be donated to charity."
Asif is now planning to launch a talent hunt show called "Akbar Asif Ko Anarkali Ki Talash" on both Indian and Pakistani television channels soon.
"With the reality TV show, we will take a huge second step that will hopefully create a sense of friendship that will last beyond our lifetime," he said.