The Kaski District Court on Friday scrapped organised crime and money laundering charges filed against Rastriya Swatantra Party chair Rabi Lamichhane, fugitive Gitendra Babu (GB) Rai and former deputy inspector general Chhabilal Joshi in the Suryadarshan Cooperative fraud case.

A bench of judge Himalal Belbase ordered the amendment to the charge-sheet, allowing only cooperatives fraud charges to remain against Lamichhane and nearly 50 other defendants.

The district government attorney’s office in Kaski had filed an application seeking amendment to the charge-sheet under Section 36 of the National Criminal Procedure Code, 2017, following instructions from the Office of the Attorney General. The court approved the request on Friday.

With the order, claims related to organised crime and money laundering have now been removed from the case in Kaski, while the cooperatives fraud charges remain intact.

Then-attorney general Sabita Bhandari had decided on January 14 to amend the charge-sheet in Lamichhane’s case. On January 16, citing an earlier procedural error, she authorised similar amendments for all defendants, including GB Rai and Joshi. Based on that directive, the Kaski district government attorney’s office moved the court seeking approval to revise the charge-sheet.

However, in February, a bench of judge Neetij Rai had, on February 17, halted the process after a writ petition challenging the attorney general’s decision was filed at the Supreme Court.

Lamichhane’s legal team later moved the Pokhara High Court against that order. The high court subsequently ruled that the Kaski District Court itself should hear the matter, paving the way for Friday’s decision.

Two separate applications seeking amendment of the charge-sheet had been registered in three different cases involving GB Rai, Joshi and other defendants.

Representing the government during Friday’s hearing were Rudra Prasad Panthi, joint attorney at the High Government Attorney’s Office in Pokhara, deputy attorney Swatantra Neupane, Kaski district attorney Kamala Kafle and assistant district attorneys Sujata Poudel and Deepak Aryal.

Senior advocate Rohitraj Bastola and advocates Priti Pandey and Ramesh Giri represented the defendants.

In its order, the court cited four main grounds for approving the amendment.

The court noted that the original complaint filed by the victims did not include allegations of organised crime or money laundering, and that the government itself had not initially pursued those charges in the main charge-sheet.

It also said retaining those charges could obstruct possible settlements between victims and defendants and complicate efforts to recover depositors’ savings.

The court further said removing the organised crime and money laundering charges would not undermine the broader principle of justice. It observed no malicious intent in the prosecution’s request to amend the case and said the move reflected sensitivity towards the rights of both victims and defendants.

The case relates to the alleged embezzlement of depositors’ funds by officials of the Suryadarshan Cooperative in Pokhara.

Initially, only a cooperative fraud case was filed. Later, supplementary charge-sheets adding organised crime and money laundering charges were also registered. Lamichhane, GB Rai and Joshi were named defendants in all three cases.

The court said that although the earlier amendment decision had applied only to Lamichhane, the same correction process should also apply to other defendants to address procedural inconsistencies.

The amended order will now be treated as an integral part of the original, supplementary and additional charge-sheets, the court said.

Kaski district court registrar Rajan Khanal said further legal proceedings would now move ahead on the basis of the revised charge-sheet.

“The court has ordered an amendment to the charge-sheet as requested by the government attorney’s office, retaining only the cooperative fraud charges and removing claims related to organised crime and money laundering,” Khanal said. “The remaining legal process will now proceed on the basis of the amended charge-sheet.”

Kiran Shrestha, coordinator of the Suryadarshan Victims Struggle Committee, said victims hoped the amendment would help ensure the return of their savings.

“If the authorities work according to the stated objective behind the amendment, it could bring some relief to victims,” he said. “But if the amendment is pursued without ensuring justice for depositors, the consequences will soon become clear.”

The former attorney general’s decision to withdraw the charges had sparked legal and political controversy, with critics alleging political interference.

Advocates Dinesh Tripathi and Yubaraj Paudel, among others, filed a writ petition at the Supreme Court on January 18 challenging the legality of the decision.

The petition argues that withdrawing serious charges such as organised crime and money laundering was contrary to constitutional and legal principles and amounted to interference in the judicial process.

The petitioners also argued that the cooperative fraud, organised crime and money laundering cases were interconnected and that withdrawing only some charges was unjustified.

The writ petition is still under consideration at the Supreme Court.

Earlier, the Rupandehi District Court had also ruled that the charge-sheet could not be amended while the case was sub judice before the Supreme Court. The process of withdrawing organised crime and money laundering charges against Lamichhane in Rupandehi remains on hold.

Cases related to cooperative fraud, organised crime and money laundering have been filed against Lamichhane in district courts in Kaski, Rupandehi, Kathmandu and Chitwan.

Among those cases, Kaski has now become the first district where organised crime and money laundering charges have formally been dropped.

Victims of the Suryadarshan Cooperative have accused Lamichhane and others of diverting cooperative funds into Gorkha Media Network. Prosecutors have claimed that investigations found evidence that money withdrawn from the cooperative had been invested in multiple areas and subjected to money laundering.