The roughly 2,000 protesters from the Tehreek-i-Labaik Ya Rasool Allah Pakistan group have blocked a main highway used by thousands of commuters since November 6, causing hours-long traffic snarls.
The sit-in has already cost the life of at least one eight-year-old child whose ambulance could not reach a hospital in time due to the blocked roads, a statement from the Supreme Court has confirmed.
The largely unknown hardline religious group is relatively small and no serious violence has broken out, but despite the growing frustration of residents and previous court orders for the site to be cleared authorities have hesitated to act, insisting on negotiations instead.
He said it was "beyond understanding" how even a prime minister could fail to act on a court order, and branded the sit-in not freedom of expression but "anti-state activity".
"Patients dying for want of access to hospitals, traders crying for lack of business activity, students are being deprived from their right to education and (the) right of free movement of almost six million people of (the) twin cities (is being) usurped," he said.
Such agencies, particularly those run by the powerful military such as the ISI, have been accused of undermining civilian governments in the past in a country that has been ruled by generals for half its 70-year history.
The Islamabad High Court's scolding came one day after the Supreme Court also rejected the government's claim that using force on the protesters could result in injuries and deaths which would foment further unrest in the country.
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