The fallout from the decision to take former chief justice Cholendra Shumsher Rana to a police office over an alleged security threat has spread from Nakkhu prison in Lalitpur to the Armed Police Force headquarters.

Investigators say the case could widen further after intermediary Inam Sapkota was linked to the episode. The investigation is now examining contacts between senior police officials and Sapkota, as well as the possible leakage of sensitive information.

Controversial businessman Deepak Bhatta, who had been held at Nakkhu prison on charges related to money laundering, corruption and banking offences, has since been transferred to Sindhupalchok prison. Police officials said members of the prime minister’s secretariat have alleged that Rana was also involved in efforts to secure Bhatta’s release.

Bhatta was remanded in custody after preliminary hearings in cases pending at the Patan High Court and the Special Court in Kathmandu. He had been sent to Nakkhu prison after the courts ordered his detention pending trial. Government officials allege that efforts to influence the case began after Bhatta’s lawyers filed a petition at the Supreme Court challenging the order to keep him in custody.

As part of the investigation launched after Rana was taken to the police office, police found that the former chief justice had communicated with Sapkota several times and began looking for the intermediary. After locating Sapkota and examining his mobile phone records, investigators found that senior officials of both the Armed Police Force and Nepal Police had also been in regular contact with him, according to a police officer who spoke to Kantipur. It has not been established whether the contacts involving senior Nepal Police officials were merely routine or involved anything beyond a professional acquaintance, the officer said.

According to sources, the Special Bureau, which investigates terrorism and transnational crime, detained Sapkota at Tribhuvan International Airport at around 1:30pm last Wednesday. Sapkota, who holds a US green card, had arrived in Kathmandu only a few days earlier and was preparing to travel to New Delhi when he was detained. Police officials also claim that he has links with some Nepali Congress leaders aligned with the Deuba faction.

Information obtained from Sapkota’s phone after his arrest also led to the suspension of Additional Inspector General Banshi Raj Dahal, who heads the  Armed Police’s operations department.

A senior home ministry official said Dahal had gone to the police office at around 3am to meet Rana while the former chief justice was being held there and left at around 5am without informing senior officials.

“That led to an inquiry into him,” the official said. “After it became known that he had gone to the police office to meet Rana, Inspector General Narayan Dutta Poudyal was also asked whether Dahal had obtained permission.”

According to the home ministry official, Home Minister Sudan Gurung asked Poudyal about the visit and was told that the inspector general had not been informed beforehand. Poudyal said he was informed only after Dahal had returned from the meeting, the official said.

The APF headquarters initially did not treat the matter as serious and instead recommended Dahal for an extension of his tenure to the home ministry. Under the Armed Police Force Rules, 2015, the government can extend the four-year tenure of an AIG or DIG by one year on the recommendation of the inspector general. Most AIGs and DIGs have traditionally received such one-year extensions.

Without an extension, Dahal would have completed his four-year tenure and retired on October 13.

The home ministry was to decide whether to extend his tenure following the recommendation from the APF headquarters. But screenshots of several messages subsequently reached Home Minister Gurung, prompting the ministry to suspend Dahal shortly before his retirement.

According to ministry sources, information had emerged earlier that Rana was continuing to attempt to influence judicial proceedings at the Supreme Court even after leaving office.

“There were particular efforts to secure Deepak Bhatta’s release, and Sapkota appears to have acted as an intermediary between the two sides,” a ministry official said. “The fact that a serving AIG was in regular contact with such a person through WhatsApp and Signal raised further questions.”

Gurung subsequently instructed APF chief Poudyal to seek an explanation from Dahal. In his response, Dahal said he had gone to meet Rana because of a family relationship and denied engaging in any conduct contrary to official standards.

The home ministry nevertheless decided to suspend him, saying evidence had already emerged. Poudyal also went to the ministry on Monday afternoon. Gurung described the information received by the ministry as serious and instructed home secretary Kedarnath Sharma to issue a statement announcing Dahal’s suspension.

The ministry subsequently said Dahal had been suspended for allegedly leaking sensitive security-related information and engaging in conduct contrary to official standards. It appointed an inquiry officer to investigate the allegations and submit a report within three days.

The ministry statement said all personnel under its authority are required to follow professional standards appropriate to their positions and protect the confidentiality of sensitive security information. It also said the ministry was closely monitoring and analysing conduct contrary to official duties, leaks of sensitive information, and activities that could adversely affect public security.

Gurung himself said on Tuesday morning that he had long been monitoring what he described as a tendency among officials and employees under the ministry to misuse their positions by leaking confidential or sensitive information to unauthorised individuals or entities.

“Sensitive state information is not anyone’s private property; it is a public responsibility,” he said. “A position gives access to information, but it does not give anyone the right to misuse it.”

Officials close to Dahal, however, have alleged that rival aspirants were behind efforts to prevent his tenure from being extended. They said extending Dahal’s tenure by a year would have blocked another officer’s opportunity for promotion.

“Had his tenure been extended by a year, another officer would have lost the opportunity for promotion, so efforts were made to create a situation in which he would have to leave,” one of the officers close to Dahal claimed. “That objective has now been achieved.”

With Dahal’s tenure unlikely to be extended, Deputy Inspectors General Suresh Shrestha, Dipendra Shah and Purushottam Thapa are now competing for promotion to Additional Inspectors General, according to officials. Another AIG, Anjani Kumar Pokharel, has been assigned to investigate the allegations against Dahal.

Sapkota is currently being held at the Kathmandu District Police Range. The Special Bureau handed him over to the district police after questioning him. He was then remanded in custody by the District Administration Office, Kathmandu for investigation into an alleged offence of indecent behaviour towards police.

“We have obtained permission to keep him in custody for seven days to investigate the alleged offence of indecent behaviour,” said SP Dan Bahadur Thapa of the Kathmandu police.