PESHAWAR: The Peshawar High Court has turned down the petition of a former chief executive officer of the Khyber Pakhtunkhwa Economic Zones Development and Management Company (EZDMC) against his removal by the provincial government.

A bench consisting of Justice Syed Mohammad Attique Shah and Justice Sahibzada Asadullah pronounced the order after the completion of arguments by lawyers for the petitioner, Javed Iqbal Khattak, and the provincial government.

Last month, the court granted an interim relief to the petitioner by stopping the government from initiating the process to appoint the new CEO to the company.

The petitioner had requested the court to declare the impugned acts related to his removal, including the cabinet’s decision, illegal and unconstitutional.

Petitioner insisted cabinet wasn’t authorised to terminate his service

After the petition was filed, the secretary of the industries department issued a notification on Sept 2, terminating the service of the petitioner.

The petitioner’s counsel contended that after following all legal formalities, the EZDMC’s board of directors selected and appointed the petitioner as the company’s CEO on Feb 10, 2020. He added that the decision was subsequently approved by the provincial cabinet and the relevant notification of his appointment was issued on March 18, 2020, for a term of three years.

The lawyer said that in view of the outstanding performance of the petitioner, the HR committee of BoD, in its meeting on Aug 17, 2022, recommended the extension of his employment term.

He said that the recommendation was made by keeping in view the provisions of the extension of a CEO in light of the SECP Public Sectors Company (Appointment of Chief Executive) Guidelines, 2015.

The counsel also pointed out that the Article of Association of EZDMC declared that the CEO should be a contractual employee to be hired for a period of three years renewable term with the approval of the government.

He contended that the contract of the petitioner was later extended for another term of three years by KP cabinet in its meeting on Dec 13, 2022, on the recommendation of BoD and the term would expire in 2026.

The lawyer, however, said that the cabinet, in its meeting on Aug 27, 2024, decided to remove the petitioner though the issue was not on the agenda of the meeting.

He argued that Section 190 of the Companies Act authorised a company’s BoD to remove the CEO but the KP cabinet was not vested with any authority to remove him.

The counsel said that before removing him, the provincial government didn’t bother to consult the board.

Assistant advocates general Farhan Qadeer and Waqar Orakzai argued that the notification about the termination of the CEO’s service had already been issued by the government.

They argued that the petitioner had been removed from the service in accordance with the relevant laws and rules and that the provincial government had the authority to remove the company’s CEO.

The AAGs said that the BoD had illegally made recommendations to the provincial government to extend the tenure of the CEO for further three years with effect from March 20, 2023.

They added that the earlier approval of the provincial cabinet on Dec 13, 2022, to give extension to the petitioner by terming it re-appointment was also illegal. The AAGs contended that appointment of a CEO could only be made through a competitive process by advertising the post and there was no provision of service extension in the law.

Published in Dawn, October 12th, 2024