The Butwal bench of the Tulsipur High Court on Thursday ordered the release of Rastriya Swatantra Party (RSP) chairman Rabi Lamichhane on bail, setting specific conditions. He was taken into judicial custody in connection with the Supreme Cooperative fraud and organised crime cases.

A division bench comprising Chief Judge Basudev Acharya and Judge Tej Narayan Paudel issued the order, directing Lamichhane’s release upon depositing bail equivalent to the alleged loss amounting to Rs27.48 million.

The court noted that Lamichhane had submitted an application expressing readiness to deposit bail equivalent to his alleged liability. On that basis, the bench quashed the earlier order that had sent him to judicial custody for trial and ordered his release on bail instead.

Lamichhane, a former television presenter-turned-politician and the founding chief of the RSP, had been in judicial custody over allegations of misappropriation of funds belonging to the Butwal-based Supreme Cooperative. The hearing held on Thursday marked the seventh consecutive hearing since October 30 in the case involving Lamichhane and another defendant, Chhabilal Joshi.

During the proceedings, hearings were postponed twice at the request of Lamichhane’s side and once at the request of Joshi’s side, while the prosecution did not seek any adjournment. Under the law, both the prosecution and the defence are allowed to seek adjournments up to two times each.

With the order, Lamichhane, who is currently held at Nakhkhu Prison, will be released on bail pending further proceedings in the case.

After completing the required procedures in line with the order, Lamichhane is set to be released from custody likely on Friday. According to Ram Bahadur Kunwar, information officer at the high court, the original case file along with the high court’s order will reach the Rupandehi District Court on Friday.

Following this, the district court will issue a conditional release order in accordance with the high court’s verdict. As per the order, a guarantee covering the claimed amount must be secured, and a written undertaking must be obtained confirming that, should the court’s final verdict create any additional liability with regard to the claimed losses, the defendant agrees to pay or settle such obligations. Once these formalities are completed, the court will order his release from detention.

Rabi Lamichhane must personally appear before the court, submit the written consent accepting the conditions, and take a hearing date. Only after completing these steps will he be released from custody.

More cases involving cooperative fraud, organised crime, and money laundering against him are still pending in various courts.

Mahendra Pandey, the legal practitioner who argued on Lamichhane’s behalf on Thursday, said the court order allows him to fight the case outside the judicial custody.

“At this stage, the order merely permits him to contest the case while staying out of custody. The other legal procedures related to the case are still pending,” said Pandey.

The high court has ordered Lamichhane’s release, setting five specific conditions. The bench stated that ensuring the protection of depositors’ and investors’ funds must be the court’s primary concern, and therefore decided to accept bail subject to clearly defined safeguards.

According to the order, the first condition requires acceptance of the bail amount that had been sought by the district court during the detention hearing that began on January 26,2025. The court directed that the bail figure previously demanded by the district court be enforced as part of Lamichhane’s release.

Second, the court ordered that the bank guarantee submitted by Lamichhane—covering an amount of Rs 27.48 million in claimed losses—must be secured. The bench stressed that this guarantee should remain protected to ensure that the financial interests of depositors and investors are not compromised during the course of the proceedings.

Similarly, the court imposed restrictions on foreign travel. If Lamichhane needs to travel abroad, whether in a personal or institutional capacity, he must inform the court in advance. The condition aims to ensure Lamichhane’s availability throughout the legal process and prevent any risk of absconding.

Fourth, the bench ruled that Lamichhane must formally agree to comply with any obligations determined by the final verdict. The order states that once the court delivers its judgment, he will be bound to act in accordance with the ruling. Furthermore, if the verdict creates additional financial liabilities related to the claimed losses, Lamichhane must accept responsibility to pay or settle such amounts. The court directed that a written undertaking to this effect be obtained before his release. Fifth, the court annulled the order issued by the district court on August 11, 2025 which had previously directed that Lamichhane be remanded in custody.

According to legal experts, Lamichhane will be allowed to contest elections at the present status because no court has so far convicted him. “He has not lost the eligibility of a candidate determined by the constitution and election laws,” constitutional expert Bipin Adhikari told the Post.

In the same case, the high court has ordered that another defendant of a similar nature, Chhabilal Joshi, a director of Gorkha Media, be kept in judicial custody for the time being. The high court ruled that, in Joshi’s case, the application seeking release from detention upon payment of an amount equivalent to the claimed losses did not meet the required legal criteria. Consequently, the court concluded that he could not be released on bail at this stage and must remain in custody.