The Treaty of Sugauli (also spelled Sugowlee, Sagauli and Segqulee), the treaty that established the boundary line of Nepal, was signed on 2 December 1815 and ratified by 4 March 1816 between the East India Company and King of Nepal following the Anglo-Nepalese War of 1814-16. The signatory for Nepal was Raj Guru Gajraj Mishra aided by Chandra Sekher Upadhayaya, the signatory for the Company was Lieutenant Colonel Paris Bradshaw. The treaty called for territorial concessions in which some of the territories controlled by Nepal would be given to British India, the establishment of a British representative in Kathmandu, and allowed Britain to recruit Gurkhas for military service. Nepal also lost the right to deploy any American or European employee in its service (earlier several French commanders had been deployed to train the Nepali army).
Under the treaty, about one-third of Nepalese controlled territory was lost including all the territories that the King of Nepal had won in wars in the last 25 years or so such as Sikkim in the east, Kumaon Kingdom and Garhwal Kingdom (also known as Gadhwal) in the west. Some of the Terai lands were restored to Nepal in 1816 and more were restored in 1860 to thank for helping the British to suppress the Indian rebellion of 1857.
The British representative in Kathmandu was the first Westerner allowed to live in the post-Malla Era Nepal. (It is to be noted that few Christian missionaries operating were deported by the Gorkhas after conquering Nepal during the mid 18th century). The first representative was Edward Gardner, who was installed at a compound north of Kathmandu. That site is now called Lazimpat and is home to the Indian and British embassies. The Sugauli Treaty was superseded in December 1923 by a "treaty of perpetual peace and friendship," which upgraded the British resident to an envoy. A separate treaty was signed with India (independent by now) in 1950 which established relations between the two countries.
The territories under Nepalese control included Darjeeling to the South-east, whole of Sikkim to the east, Nainital to the south-west and the Kumaon Kingdom and Garhwal Kingdom to the west.