Both actors shared copies of a settlement agreement on their social media accounts on June 22 and confirmed that they had reached a mutual understanding.
Dispute began after podcast appearance
The disagreement started after Shajaffar appeared on the YouTube show Say It All with Iffat Omar in May.
During the interview, she alleged that a person identified as “Arsalan” had made her feel uncomfortable while working on set.
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Shajaffar later clarified on social media that she was not referring to actor Arslan Khan, her College Gate co-star.
Public discussion later linked the remarks to Arslan Butt after comments attributed to the programme host.
Legal notices followed public allegations
Following the controversy, Butt issued a legal notice.
He described the allegations as false, baseless and defamatory.
The notice claimed the remarks caused reputational harm, emotional distress and public embarrassment.
Butt demanded a retraction, removal of the disputed content and a public apology. He also asked that similar allegations not be repeated.
Shajaffar later responded with a Rs1 billion counter-notice.
Her legal response described Butt’s claims as legally defective and alleged that the notice aimed to pressure and silence her following alleged harassment.
Settlement agreement closes dispute
According to the agreement signed on June 19, both sides acknowledged that misunderstandings and disputes had emerged through statements, communications and legal actions.
The document stated that both parties resolved the matter voluntarily with support from elders, well-wishers and mutual mediators.
The agreement specifically addressed the issue of alleged workplace harassment and declared the matter resolved.
Both parties confirmed that no claims, disputes or grievances remain pending.
The settlement also stated that all previous allegations, notices, complaints and legal communications have been withdrawn and closed.
No admission of wrongdoing
The agreement clarified that the settlement should not be treated as an admission of guilt, misconduct or legal liability by either side.
It also stated that both actors agreed not to make hostile, defamatory or adverse statements about each other in the future.
The parties further agreed to cooperate in closing or withdrawing any remaining complaints, applications or legal proceedings connected to the dispute.
