The court also declared that all decisions taken by Nawaz as PML-N president since July 28 stand null and void after the judgment.
The announcement was made in PML-N's Central Working Committee (CWC) meeting which was held in Lahore and was presided by the country's former premier Nawaz Sharif, reported the Express Tribune.
Nawaz Sharif had already put his weight behind his younger brother for performing well in Punjab and keeping the party united by dint of his "exceptional qualities". Climate Change Minister and PML-N's information secretary Mushahidullah Khan told reporters on Monday that the election of an interim president of the PML-N was the top agenda item for the CWC meeting.
"Begum Kulsoom would have been the best choice to succeed Nawaz Sharif but since she is not well and is recovering from throat cancer (lymphoma) in London, Shahbaz Sharif has become the ultimate choice although some close to Nawaz have reservations (about him)".
"How long will this keep happening and how long can the country function like this?" asked Nawaz, who was ousted from the post of prime minister by the Supreme Court a year ago for dishonesty in declaring his assets.
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Shahbaz Sharif has been elected for the interim period of 45 days until the general council meeting takes place next month to elect the full-time president. Shehbaz, who has a formidable reputation as an administrator but is considered less charismatic than Nawaz, is expected to be the party's prime ministerial candidate.
Despite the court rulings against the PML-N, the party will likely remain a force at the polls after whipping its rivals in consecutive by-elections. "I will try my best to come up to the expectations of my party after assuming this responsibility", he said.
A bench headed by Chief Justice Mian Saqib Nisar declares that any person disqualified under Articles 62 and 63 of the Constitution is barred from holding the position of head of a political party.
He was first elected as the PML-N president during exile in 2002, due to the registration of cases against Nawaz. The party's CWC would pass a resolution to repose full confidence in the leadership of Nawaz Sharif, the source said, while adding that a follow-up resolution would be tabled to denounce the vindictive acts and harassment of bureaucrats and politicians at the hands of the National Accountability Bureau (NAB).