LAHORE: The Lahore High Court has struck down the appointment of the managing director of the National Transmission & Dispatch Company (NTDC) for being made against the law and ordered a fresh process for the selection of the company`s chief strictly in accordance with the State-Owned Enterprises (Governance & Operations) Act 2023.

Justice Shahid Karim issued the directive on Tuesday last (a day before Eid), allowing a petition by Dr Khwaja Riffat Hassan, who was not appointed as MD of the NTDC despite being a principal candidate among three-shortlisted aspirants.

The petitioner stated that the process for the impugned appointment was set in motion on an advertisement in newspapers seeking applications from wellreputed professionals.

His counsel stated that at the time the process was initiated, the Public Sector Companies (Corporate Governance) Rules, 2013 (2013) Rules) were in placewhich governed the appointment process of the NTDC MD, a public sector company.

He said the appointment was made by the federal government on Feb 8, 2023, while the State-Owned Enterprises Governance & Operations) Act 2023 was already enacted on Jan 30.

Therefore, he argued that the appointment of the MD was supposed to be made under the 2023 act and not under the 2013 rules.

Justice Karim agreed with the petitioner`s arguments and observed that it would be a fallacy to hold that despite the commencement of the 2023 act the process under the 2013 rules could continue unimpeded.

`That would be tantamount to reading into section 36 of the 2023 Act words that do not exist,` he maintained.

The judge said the argument that the process had already started before the commencing of the 2023 act does not have any legitimacy.

He ruled that once the 2023 act had been promulgated, the process of the appointment ought to have been put on hold to give effect to the latest legislation by clearly stating that since a new procedure had been laid down and since the process had not attained finality to give way to a fresh process to be initiated.

`Since the appointment of respondent No.5(Dr Rana Abdul Jabbar Khan) is in contravention, thereof, it must be struck down as without lawful authority and of no legal effect,` Justice Karim declared in the verdict.

The judge made it clear that the appointment for NTDC MD may be initiated by the board of the company in accordance with the provisions of the 2023 act.