Peshawar High Court Declares Appointment of Civil Servants as WSSC CEOs Illegal
Peshawar: The Peshawar High Court has declared the appointment of civil servants as Chief Executive Officers (CEOs) of various Water and Sanitation Services Companies (WSSCs) illegal and set aside the provincial government’s notifications issued in 2024.
A division bench comprising Justice Syed Arshad Ali and Justice Babar Sattar ruled that the notifications issued on September 11, 2024, appointing civil servants as CEOs of six WSSCs were contrary to law and inconsistent with principles of corporate governance.
While partially allowing a petition filed by engineer Mohammad Naeem Khan, the court directed the respective Boards of Directors of the WSSCs to complete the appointment process for CEOs within three months.
The court ordered that, as an interim arrangement, chairpersons of the boards of directors of the respective companies would perform CEO functions only for convening board meetings, determining eligibility criteria, advertising CEO positions, and completing the appointment process strictly according to law.
The bench rejected the petitioner’s argument that an engineer should necessarily be appointed as CEO due to the technical nature of the services, observing that the public sector companies themselves must determine eligibility criteria according to job requirements.
The six affected WSSCs include Peshawar, Bannu, Kohat, Dera Ismail Khan, Mardan, and Swat.
The petitioner’s counsel, Shumail Ahmad Butt, argued that WSSCs are public sector companies incorporated under relevant company laws and operate as independent corporate entities with their own Memoranda and Articles of Association defining CEO appointment procedures.
He maintained that under the existing legal framework, civil servants cannot be appointed as CEOs of such companies merely through transfer or posting.
Representatives of the provincial government argued that the Companies Act allows the government to nominate CEOs where the majority of directors are appointed by the state.
The court observed that the global practice of establishing public sector companies for services such as water management, waste management, and grassroots public services is aimed at improving efficiency, flexibility, and institutional autonomy.
The judgment emphasised that public sector companies should be able to operate effectively without being restricted by traditional bureaucratic procedures, enabling faster decision-making and improved service delivery.