The Special Court has convicted suspended Mayor of Nagarjun Municipality, Mohan Bahadur Basnet, and real estate businessman Raju Prasad Kandel in a high-profile money laundering case.

A bench comprising chair Tek Narayan Kunwar and member Ram Bahadur Thapa on Friday found that Basnet laundered money totalling Rs92,246,033 received from Kandel, the operator of Padma Colony and Padma Merchant Company.

The Commission for the Investigation of Abuse of Authority (CIAA) had filed the case at the Special Court on December 29, 2024, accusing Basnet and others, including his wife Urmila Basnet, of accepting and laundering bribes in exchange for misusing his public position.

According to the CIAA charge sheet, Basnet abused his office to facilitate tax exemptions for Jagadguru Kripalu Pratisthan Nepal, chaired by Kandel, and approved foreign aid totalling Rs7.48 billion to the trust. The prosecution said this arrangement was made with an intent to extract illegal benefits from Kandel’s firms operating within the municipality.

The court acquitted Urmila Basnet, while convicting both Basnet and Kandel of laundering proceeds of corruption. The sentence hearing has been scheduled for June 30.

The CIAA said Basnet routed Rs21,573,395 into his personal bank account and accepted land worth Rs68.2 million. He also arranged for Rs2.47 million to be paid to Shankar Hotel for a family wedding reception.

The investigation revealed that land purchased ostensibly for a temple under Jagadguru Kripalu Pratisthan was instead sold in plots, raising funds. Basnet reportedly received Rs30.072 million into his personal account from individuals involved in these transactions.

The CIAA demanded a penalty and imprisonment against Basnet, holding him responsible for laundering a total of Rs131,273,032.

Kandel, found to have encouraged, assisted, and facilitated the laundering process, was also convicted. The charge sheet mentioned that Padma Colony had underpaid for government land—settling only Rs189,418,448 for property valued at Rs477.5 million, with the remainder allegedly managed through collusion between Basnet and Kandel.

Basnet, elected mayor in both 2017 and 2022 under the Nepali Congress ticket, remains suspended following the indictment.