Punjabi Taliban chief Asmatullah Muawiya, who had on Thursday said Sharif had shown maturity by asking rebels to join peace efforts, was expelled by the Tehrik-e-Taliban Pakistan (TTP).
A spokesman of the TTP, an umbrella group of over a dozen factions, said Muawiya had no authority to respond to the government's offer as such decisions are solely the domain of the high powered 'Shura' or council.
"We have nothing to do with Muawiya from today and we will appoint a new chief of the Punjabi Taliban," said spokesman Shahidullah Shahid.
Muawiya is also head of the dreaded Lashkar-e-Jhangvi, the largest militant group in central Punjab province. He has been linked to deadly attacks on the security forces and the minority Shia community.
The Punjabi Taliban and the LeJ are also linked to Al Qaeda.
Media reported that in his immediate reaction to his removal by the Taliban, Muawiya said the TTP had no authority to do so as he was independent of them.
Sharif, in his first televised speech on Wednesday, asked the militants to enter peace talks to end deadly violence in the country.
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