Nepal Airlines Chairman Appointment Under Legal Challenge

Nepal's Supreme Court Just Issued a Show Cause Order Against Nepal Airlines New Chairman, Six Weeks After Annulling the Board Below Him

Nepal's Supreme Court issued a show cause order on July 21, 2026 against the appointment of Maheshwar Bhakta Shrestha as Nepal Airlines Corporation's executive chairman, directing the Prime Minister's Office and Ministry of Tourism to respond before the next hearing on July 24. The writ was filed by board member candidate Upendra Bahadur Karki, who alleged the appointment violated legal criteria and age limit provisions.

This is the third major court intervention in Nepal Airlines' leadership in six weeks. The airline has not had a stable, legally uncontested management team since the current government took office.

The Timeline of a Governance Collapse

The sequence of events since the Balendra Shah-led government came to power tells the story more clearly than any single development. On June 12, the Supreme Court invalidated the appointment of five members to the Nepal Airlines Corporation board, appointments that had been approved by Cabinet on the recommendation of the Minister for Culture, Tourism and Civil Aviation. The court's finding was unambiguous: candidates ranked first in order of merit had been sidelined without basis or reason, and junior candidates appointed in their place.

Before that, in early June, the Supreme Court had already issued an interim order halting the entire board selection process after Karki alleged he was unfairly dropped from the final shortlist despite performing well in the competitive process. The government pushed ahead regardless, made the appointments, and had them annulled by the same court weeks later.

Now the executive chairman appointed to lead the institution whose board was just annulled is himself facing a show cause order. The hearing is set for July 24. Nepal Airlines currently has no legally settled board and a chairman whose appointment is before the Supreme Court simultaneously. 

The Institution Underneath the Legal Crisis

None of this exists in a vacuum. As we reported previously, Nepal Airlines carries NPR 55 billion in debt, had its first-half financial year loss driven significantly by engine groundings, is still waiting on a formal response to a Chinese aviation authority safety query from February 2026, and has six executive positions below the general manager level all filled in an acting capacity. The rot, most analysts agree, began after the restoration of multi-party democracy in 1990, when politicians began interfering in management appointments and lucrative contracts were awarded on the basis of relationships rather than merit. 

Critics have also pointed out that the existing Nepal Airlines Act contains no provision for appointing an executive chairman through open competition, meaning the legal framework the government is using does not clearly exist in the statute it is supposed to operate under. That foundational ambiguity is what creates the space for repeated legal challenges, because every appointment can be contested on procedural grounds before its merits are even examined.

What the Court Is Actually Saying to the Government

The Supreme Court has, within roughly 100 days of the Shah government taking office, annulled its Nepal Airlines board appointments, halted its media advertising policy, blocked forced evictions, stopped student organisation removals from campuses, and examined the Attorney General's qualifications. The Nepal Airlines interventions are not isolated rulings, they are part of a pattern in which the judiciary is consistently finding that the executive is moving faster than the legal frameworks that are supposed to govern its decisions.

For an airline that needs stable leadership to address a debt crisis, negotiate aircraft acquisitions, respond to safety regulators, and execute any kind of operational reform, the court calendar is now the most important document in the building. The July 24 hearing will determine whether Nepal Airlines enters August with an executive chairman who can act — or with yet another vacancy at the top.