The Sikh celebration of the return of the sixth Nanak from detention in the Gwalior Fort coincides with Hindu festival of Diwali. This coincidence has resulted in similarity of celebration amongst Sikhs and Hindus.

When Murtaja Khan, Nawab of Lahore, noticed that Guru had constructed a fort at Amritsar and was also strengthening his army he informed about it to King Jahangir. He also emphasized that he was making preparations to take revenge for his father's assassination. When Jahangir came to know about this he at once sent Wazir Khan and Guncha Beg to Amritsar in order to arrest Guru Hargobind Sahib.
But Wazir Khan who was a well-wisher of the Sikh Guru’s requested the Guru to accompany them to Delhi as King Jahangir wanted to meet him. The Guru accepted the invitation and reached Delhi.
On their first meeting when Jahangir saw the Guru, he was completely won over by his youthful charm and holiness. King decided to befriend the Guru. So he gave royal welcome to the Guru. But Chandu Shah could not bear it. His daughter was still unmarried and thus the rotten sore was still bleeding. At Agra, the King fell seriously ill. The physicians tried their best but they failed to care him. Then Chandu Shah conspired with the astrologers, who were asked to tell the King that his malady was due to wrong track of stars and it could, be cared only if some holy man goes to Gwallior Fort to offer prayers to the deity. He also pointed out that Guru Hargobind was such a holy man and he should be asked go to Gwallior Fort. At King’s request the Guru readily agreed and left for the Gawalior Fort.
In the fort the Guru met many princes who were detained there due to political reasons. They were leading a very deplorable life. With the help of Hari Dass, the governor of fort, the Guru improved their condition. Hari Dass was a Sikh of Guru Nanak and he become ardent devotee of Guru Hargobind. Once when Chandu wrote to Hari Dass to poison the Guru, he at once placed that letter before the Guru.
When several months passed and the Guru was not released then Baba Budha and other devotees met the Guru. They informed him about the despicable condition of the Sikhs, who were waiting for him with great eagerness. The Guru assured them that they should not worry, he would join them soon.
In the meantime Sai Mian Mir met Jahangir and asked him to release the Guru. Jahangir, who had fully recovered, ordered Wazir Khan reached Gwallior Fort and informed Hari Dass about the message of the King. Hari Dass was very pleased to hear it. He informed the Guru about the message of King. But the Guru declined to leave the fort unless princes confined in the fort were also released. When Wazir Khan informed king about the desire of the Guru, the king agreed. The fifty–two princes who had been detained due to political reasons or for committing default, were pining in fort for years. The Guru left the fort with all fifty-two princes. As the Guru liberated the fifty-two princes so he is known as Bandichhod (Liberator).

A Gurdwara known as Bandichhod is built at the place where Guru stayed during his detention. Jahangir advised Wazir Khan to bring Guru Hargobind in his court at Delhi with great honour. Jahangir realized that he had killed as innocent pious man Guru Arjan Dev without any offence. He wanted to exonerate himself by indicting this crime on Chandu Shah and other officers. So in order to show his innocence he wanted to meet Guru Hargobind. The Sikhs celebrate this day as Bandi Chhorh Divas i.e., "the day of release of detainees" . So in the evening, illuminations are done with Deewé (earthen oil lamps) or candles and fireworks. The celebrations are held both in the Gurdwaras and in homes.