PESHAWAR: The Peshawar High Court has set aside the provincial government’s order to terminate the services of the chief executive officer of the Water and Sanitation Services Peshawar and ordered his reinstatement.

A bench consisting of Justice Ijaz Anwar and Justice Syed Arshad Ali accepted a petition filed by WSSP chief executive officer Dr Hassan Nasir, declaring that the impugned notification of the provincial government issued on May 10, 2024, was “not sustainable in the eyes of the law and therefore, it was required to be set aside.”

It also dismissed the decision of the WSSP’s board of directors to approve on May 31, 2024, the impugned notification of the provincial government, observing that the decision appeared to be under instructions from the government and was not with an independent mind.

“The petitioner was never heard [by the board] before passing the said decision, so its decision notified on May 21, 2024, is also contrary to the principles of natural justice,” it ruled, adding that the decisions of the provincial government and the WSSP BoD were illegal and without lawful authority.

Declares govt’s order to remove him contrary to Companies Act

The bench, however, declared that the WSSP board would be at liberty to remove the petitioner from the office of the company’s CEO in terms of Section 190 of the Companies Act, 2017.

Senior lawyer Shumail Ahmad Butt appeared for the petitioner and said his client was appointed the WSSP CEO in 2021 for three years.

He added that on the completion of his term on Jan 8, 2024, his client’s service was extended for a period of six months or until a new CEO was regularly appointed in terms of the Companies Act 2017.

Mr Butt, however, said the provincial government, through the impugned notification, terminated the petitioner prematurely on May 10, 2024, while purportedly exercising powers under Section 190 of the Companies Act and assigned additional charge of that post to the commissioner of the Peshawar division.

He argued that under Section 190(2) of the Companies Act, the government didn’t have powers to remove a CEO in case a company didn’t have more than 75 percent voting rights.

The lawyer said that under the Act, an outgoing CEO was required to continue until their successor was appointed under Section 187.

He added that the government’s decision was bad as it meant to compromise the spirit of autonomy to the utility company and the Board of the Company wasn’t allowed to act independently.

Mr Butt referred to a 2012 judgement of the Supreme Court insisting that the apex court had held that even if someone worked at the pleasure of the government, he couldn’t be removed without adopting due process.

The bench observed that when a government held more than 75 per cent of the voting rights in the company, then it was competent to remove the CEO, but in the present case, the government held only 50 per cent of the voting rights on the company’s board.

“Even otherwise, if it is assumed that the government has any powers to remove the petitioner from his post, the powers of the government should be exercised judiciously, fairly and to advance the purpose for which the discretion was conferred upon the authority,” it ruled.

It added that the government, in such cases, didn’t enjoy absolute discretion.

“Indeed, it is a settled law that when an authority has discretion in relation to any matter, then that discretion is to be exercised according to rational reasons, which means that there be findings of primary facts based on good evidence and decisions about facts be made for reasons, which serve the purposes of statute in an intelligible and reasonable manner,” it declared.

The bench added that any action that didn’t meet those threshold requirements was considered arbitrary and a misuse of power.

Published in Dawn, June 12th, 2024