Activists of Tehreek-i-Khatm-i-Nabuwwat, Tehreek-i-Labaik Ya Rasool Allah (TLY) and Sunni Tehreek Pakistan (ST) religious groups started protests last month.
After the weeks-long protest that had virtually paralysed the capital, the government and leaders of the TLY reached an agreement on November 26 in which the former conceded to the latter's demands including dropping all the cases against the protesters.
"How can cases filed under the Terrorism Act be dismissed?" Justice Shaukat Aziz Siddiqui asked during the hearing regarding the recent sit-in at the Faizabad Interchange in the capital, Dawn News reported.
"Who is the army to adopt a mediator's role?" Justice Siddiqui had inquired in the previous hearing. "Where does the law assign this role to a major general?"
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The IHC recommended that the legal standing of the agreement should be discussed in a joint session of parliament.
Attorney General of Pakistan (AGP) Ashtar Ausaf, however, disagreed with the recommendation, saying that since the high court had taken suo motu notice of the matter, the judiciary should oversee it. He had appeared in court on Justice Siddiqui's orders, the report said.
In a written order on November 27, the IHC bench had directed the attorney general to help the court determine how the armed forces could act as an arbitrator.
The Intelligence Bureau also presented a report on the botched operation against the protesters by the police while the chief commissioner of Islamabad submitted a detailed report on the protest.
The judge remarked that the protesters were guilty of blasphemy, pointing to the language used by the protest leaders and participants during the sit-in.
Hamid's resignation cleared the main hurdle in the lifting of siege of the capital by protesters.