"The man was handed over to the British Embassy in Kathmandu after it was established through investigation that he had no political affiliation," DSP Prajit KC, Chief of Metropolitan Police Circle, Singha Durbar, was quoted as saying by the Republica Online.
Martin Benjamin Travers, 44, was arrested yesterday after he was found near the site of the sit-in protest, taking pictures of the scuffle between police personnel and hundreds of Madhesi protesters, who are demanding changes to the new Constitution.
Earlier this month, Nepal government ordered a Canadian IT professional Robert Penner to leave the country as his tweets were deemed to "incite conflict".
The authorities said Penner had violated the terms of his visa by commenting on Nepal's "internal matters".