Increase in Reconciliation Requests in Suryadarsan Cooperative Case, Victims Seek GB Rai After Bhote’s Release

May 8, Pokhara – In the Suryadarsan Cooperative fraud case, former director Shivbahadur Gurung, known as ‘Mahendra Bhote’, who was in custody for trial, has been ordered released on NPR 500,000 bail by the District Court of Kaski after agreeing to pay the compensation.

Gurung, who along with the group led by former chairman Gitendra Babu (GB) Rai is accused of embezzling cooperative funds, faces a compensation demand of NPR 178 million. After paying the bail amount, he will now be able to fight the case from outside custody.

Previously, Gurung was also charged under organized crime laws related to the cooperative’s fund embezzlement. However, after the Attorney General’s office withdrew the money laundering and organized crime cases, leaving only the cooperative fraud case to proceed, the court allowed his release on bail.

The order for bail was granted by Judge Himalal Belbase’s bench at Kaski District Court on May 5 (Jestha 22). Though the order was granted, the bail and compensation processes remain ongoing due to procedural matters, according to police sources.

On October 26, 2023 (Ashoj 10, 2080 BS), the Office of the Government Attorney filed charges against 19 individuals including former chairman GB Rai, chairman Gyan Bahadur Bamjan, vice-chair Kailash Darlami, treasurer Kumar Ramtel, and Shivbahadur Gurung.

After an arrest warrant was issued for Gurung on September 10, 2023 (Bhadra 24, 2080 BS), he surrendered voluntarily at the Kaski District Court on January 1, 2024 (Poush 17, 2080 BS) with his legal counsel.

The following day, a single bench led by Judge Basant Jung Thapa denied his bail and ordered his remand for trial.

Initially, a compensation claim of NPR 1.11 billion was filed against 19 defendants, based on complaints from 1,038 investors, following which Gurung was found to have embezzled about NPR 8 million according to financial reports.

In January 2024 (Magh 24, 2080 BS), police raided Nature Herbs’ office in Kathmandu and seized additional digital evidence related to the cooperative including software, electronic records, and transaction details linked to GB Rai’s group.

Following discovery of further embezzlement based on the evidence, 121 complaints were filed against 18 individuals and institutions, including Ravi Lamichhane, Dipesh Pun, and Netrapani Bastola.

Additional charges were registered against 19 individuals including GB and Mahendra on December 20, 2024 (Poush 5, 2081 BS), and supplementary charges filed against 44 people including Rashtriya Swatantra Party Chairman and former Home Minister Ravi Lamichhane and former DIG Chhabilal Joshi on December 22, 2024.

The requests for compensation were differentiated in these additional charges. From the total NPR 1.51 billion demanded, Gurung alone faced claims of NPR 178 million for cooperative fraud and organized crime.

Another defendant, Bhavishwar Aryal, along with Mahendra approached the High Court against the order to keep Mahendra in custody during the pretrial investigation. They also filed petitions through the Government Attorney’s Office seeking property release and bail, but were unsuccessful.

After the Attorney General’s decision to withdraw the money laundering and organized crime charges, retaining only the cooperative fraud case, both the victims and Mahendra submitted a joint petition to the Government Attorney’s Office.

District Public Prosecutor Kamala Kafle disclosed that several petitions had been filed requesting release on simple or bail bonds to proceed with the trial, and such petitions were subsequently presented to the court.

Mahendra agreed to pay the compensation amount to the cooperative’s fund and guaranteed this commitment, which was also admitted in his court statements. Based on petitions submitted by victims, the court allowed the prosecution under the condition that compensation be deposited to the cooperative fund to protect victims’ interests.

Mahendra had been in custody for two and a half years pending trial and filed a bail petition under Section 77 of the Criminal Procedure Code, 2017, which allows bail if a case is not concluded within one year of pretrial detention.

According to the Government Attorney’s Office, he also filed a petition for reconciliation under Section 131 of the Cooperative Act, 2017.

Under subsection 1 of that section, if a defendant agrees to return compensation, savings, or share amounts in accordance with the victim’s demands, or both parties consent, they can submit a joint reconciliation petition to the Attorney General or authorized government attorney. Accordingly, Mahendra and the victims have submitted a joint petition, as reported by Suryadarsan’s Cooperative Management Committee Chair Kiran Shrestha.

Judge Belbase’s bench approved the bail order based on Mahendra’s admission to deposit the compensation into the cooperative’s account.

Mahendra was accused of entering business and politics through intimidation and colluding with GB’s group to embezzle funds in various Pokhara locations. He was also alleged to have invested in nightclubs, restaurants, construction companies, and resorts in Pokhara.
He was the Central Deputy General Secretary of the UML-affiliated Youth Association and a candidate for chairperson in Madi Rural Municipality in the 2022 local elections.

Following the withdrawal of the money laundering and organized crime cases, only the cooperative fraud case remains active, resulting in an increase in reconciliation requests.

The Attorney General’s approval for the withdrawal of organized crime and money laundering charges via a petition from the Kaski District Government Attorney’s Office has triggered these reconciliation requests.

District Public Prosecutor Kamala Kafle confirmed that petitions from cooperative defendants seeking reconciliation are now being received and joint petitions with victim consent will be filed in court.

In the Suryadarsan Cooperative fraud case, the District Court had approved the withdrawal of money laundering charges against Rashtriya Swatantra Party Chairman and former Gorkha Media Managing Director Ravi Lamichhane, GB Rai, Chhabilal Joshi, and five others on May 21, 2024 (Jestha 7).

The approved petition proposed that defendants, including GB Rai, provide bank guarantees or property pledges equivalent to the compensation amount to secure the refund of savers’ money through agreement-based settlements.

Defendants who are in custody or absconding can now fight the cooperative fraud case from outside custody after paying the compensation or providing guarantees and appearing in court, which has led to numerous reconciliation petitions according to District Public Prosecutor Kafle.

Kiran Shrestha, coordinator of the victims’ struggle committee and current chair of the Suryadarsan management committee, stated that appeals for reconciliation continue and they plan to fully support the defendants while also naming borrowers as defendants.

“We urge all defendants to come forward, pay the compensation, and reconcile; we will facilitate necessary support and coordination with government attorney’s office and court,” he said, adding, “We are also preparing to initiate legal actions against defaulters.”

He also called on GB Rai to participate in reconciliation efforts. After all fugitives including Gyan Bahadur fled and the cooperative closed, Kiran Shrestha was appointed chairman on December 3, 2024 (Mangsir 18, 2081 BS) at a special general assembly.

In the Suryadarsan cooperative fraud case, Ravi Lamichhane was released on NPR 6.5 million bail after 84 days of detention on January 9, 2025 (Poush 25, 2081 BS).

On the same day, Chhabilal Joshi was released on NPR 8.8 million bail. Former Gandaki Province MP Meena Gurung, Ram Bahadur Khanal of Nature Herbs, Aarti Gurung, Krishnabahadur Gurung, and Leela Pachai were also released on bail alongside Ravi.

Former Secretary Anuj Nakarmi, Netrapani Bastola, and Vigyan Rai were also granted bail.

Former chairmen were released on NPR 1 million bail on September 23, 2025 (Bhadra 8, 2082 BS), while Devkumar Nepali was released on NPR 2 million bail on May 21, 2025 (Jestha 8, 2082 BS). GB Rai, the chief planner of the cooperative, remains absconding.

Former vice-chair Kailash Darlami has been absconding since the Generic Movement.

Treasurer Kumar Ramtel, former director Bhavishwar Aryal, and Pramod Bhattarai remain in custody for trial. Arrest warrants have been issued for 63 others who are still absconding.