He was appointed despite being dismissed from the same municipality in 2012 after being found guilty on four charges of misconduct.
The charges related to a land deal where the provincial Department of Human Settlements granted the town R28 million for a transaction.
An independent valuation later put the value of the land at R2.4m. Nqoqo faced seven charges.
The department said the recent court case related to Ngoqo’s appointment by and the payment of R781 184 to him in February.
Local Government, Environmental Affairs and Development Planning MEC Anton Bredell said the council’s decision was intended to circumvent the law.
“We never want to go to court against another sphere of government, but sadly there are times when we have no other option So we took the matter to court and we are very happy about the outcome.”
He said the court found that the decision taken by the Bitou council was unlawful and ordered that the settlement agreement entered into between the municipality and Ngoqo in February be set aside, and that his appointment as municipal manager also be set aside.
“A cost order was also made against the council. We want to urge our municipalities to remember who they are representing.
“These are communities who are putting their trust in their leaders and rely on their leaders to place community interests first,” said Bredell.
Bitou municipality’s acting head for corporate services Gerrie Groenewald said they would study the court’s decision and issue a statement in due course.