Contempt of court?: Despite orders, PDL CEO could not resume work

IT secretary says board has revalidated CEO’s removal after court decision.

KARACHI:

Under highly dramatic circumstances, Pak Datacom Limited (PDL) CEO Salman Elahi Malik was once again removed from his position after briefly holding the post on Monday.

The move, according to Malik’s lawyer Habibullah Khan, is not only illegal but can also lead to contempt of court by PDL’s management.

A massive support from company employees and an Islamabad High Court (IHC)’s order – reinstating Malik as chief of PDL – offered little help as the board of directors revalidated its June 27 resolution calling for termination of Malik’s services.

While trying to enter his office on Monday morning, Malik showed the security guards a June 28 order of IHC, which restored him as chief of PDL – a subsidiary of IT ministry and a leading ICT solution provider based in Islamabad. The guards, however, didn’t allow him inside and manhandled him and his wife, Malik told The Express Tribune.

Earlier, PDL board of directors sought Malik’s suspension – allegedly for forgery and acting beyond his authority – on June 8 by circulating a resolution, which was opposed by at least two members of the board, thus not meeting the requirement of a two-third majority.

Malik then filed a petition and the IHC, in its ruling on June 28, restored him and declared the resolution illegal. IHC, according to Malik, also said the board needs to bring a fresh resolution if it wants to remove Malik.

The board, in a meeting held on June 27, passed another resolution, terminating Malik as CEO and appointed Amir Malik as new CEO. The company also presented this new resolution to the IHC on June 28, hoping to get a decision in its favour. IHC, however, rejected it, Malik said. Malik’s lawyer said the court’s reinstatement
order was issued on June 29. Therefore, every resolution that was passed before this date is null and void, according to the court’s decision.

They should have restored him first by issuing a letter and then they should have called board meeting with a seven-day notice as per SECP rules, only then a new resolution could be passed with support from at least six members, Habibullah Khan said.

“Removing him by validating a resolution passed before June 29 is, therefore, illegal,” he said, which can lead to contempt of court.

An optimistic Malik – under whose leadership the company had won its biggest ever project; doubled the profits and achieved its highest stock price during last one year – faced massive resistance as he tried to resume work on the first working day of financial year 2012-13.

The drama started even before Malik reached the office, as dozens of employees including his supporters, protested against the IT ministry for being stopped from entering the office. Malik, too, was stopped outside his office despite showing court orders to the security staff.

Malik’s supporters, as seen in a youtube video, were chanting slogans against the ministry and carrying placards that read ‘Contempt of court not accepted, save Pak Datacom, restore Salman Malik, we want justice to prevail, any decision from the Ministry of IT will not be accepted’, etc.

When they were denied entry, according to Malik, he sought help from the police and managed to get into the building, but still he couldn’t make it to his office. Later on, he had to submit an application with the police station, which finally escorted him to his office.

The drama, however, didn’t end here. IT Ministry Joint Secretary Rashid Bashir Mazari, who was present in the office, directed Amir Malik, the new CEO, to stay in the office.

IT Ministry Secretary Farooq Ahmed Awan argued that it was Malik, who entered the office by force and manhandled the security staff with the help of “some 100 gundas [miscreants]”. The videos of protests showed protesters chanting slogans with smiles on their faces, no violence was seen, Malik’s lawyer said.

“Malik stands terminated from June 27,” Awan said when asked why Malik was not allowed to enter his office despite IHC’s orders. “Today, we revalidated the June 27 resolution,” said Awan, who is also the chairman of PDL board of directors.

He further said Malik was restored by IHC through a petition in which he challenged the circular resolution of June 8. IHC, Awan said, in the same order also stated that the board of directors had
liberty to take any decision in this matter in accordance with the law.

Later, he said, an inquiry committee submitted its report against Malik in the June 27 board meeting, which led to his termination.

Published in The Express Tribune, July 3^rd, 2012.