Tulsi Mehar was born in a humble middle class Newar family on December 30th 1896 in Lalitpur District of Nepal. He was an only child who was deeply inspired by reading the book of Maharshi Dayanand intitled "The Light of Truth". His self realizations about life and observation of self-discipline led him to understand the difficulties of the time when people were not allowed education or to express their views freely. Tulsi Mehar dared to speak up to society about the importance of self awareness and urged people to overcome ignorance and evil woes. He began to speak publicly against the prevalent religion of Hinduism, especially against the rigid caste system which led to the oppression of marginalized people, mostly women. His vision towards social reform and development emphasized women's empowerment through education and income generation programs to make women economically self-reliant. The expression of his views caused an uproar in Nepali society, pushing Prime Minister Chandra Shumsher J. B. Rana to accuse Tulsi Mehar of being anti-national. He offered him a choice - life imprisonment or life-long exile. Tulsi Mehar chose to set out for India.

His search for truth, his strong will and dedication to work for the society brought him to work closely with Mahatma Gandhi of India. He stayed in various ashrams and dedicated himself wholeheartedly to learn spinning and weaving techniques. His time with Mahatma Gandhi gave him an opportunity to gain experience and insight to the liberation of underprivileged people and renewed his commitment and conviction to return to Nepal in 1923 to bring social change. Mahatma Gandhi wrote a letter to the Nepali Prime Minister to allow Tulsi Mehar to come back to Nepal and let him work for the sake of Nepalese people. The Rana Prime Minister gave him consent and Tulsi Mehar started a small project of spinning and weaving some seventy five years ago.

Tulsi Mehar settled at Shankhamul Ghat on the bank of the sacred Bagmati River in Lalitpur District. There, he started the first textile industry in Nepal with a bundle of raw cotton donated by Gandhi, which he used as raw material for the spinning program. He established an institution named "Shree Tin Chandra Kamdhenu Charkha Pracharak Mahaguthi" in 1927 which was one of the first social services organizations at the time. Following this, he also founded another organization in commemoration of Mahatma Gandhi named "Nepal Gandhi Smarak Nidhi", which later merged in 1973 to become the "Nepal Charkha Pracharak Gandhi Smarak Mahaguthi". Prior to Tulsi Mehar's effort to initiate the spinning and weaving project, people of Kathmandu Valley used to grow cotton in their field and spin and weave on their own. With Tulsi Mehar’s organization, they were able to work in a semi-industrial way, gain skills and increase their revenue. Eventually, a retail outlet was set up in Mangal Bazar where production, raw material collection and distribution were channeled. This small outlet later developed and became "Mahaguthi, Craft With a Conscience" in 1984, which at present serves over 1000 producers throughout Nepal.

It was also Tulsi Mehar's vision to establish an ideal residential type of training centre in Manohara, Kathmandu for the care of widowed and abandoned women. In 1977, he received the "Nehru Award" as recognition for his social service and donated the whole amount of 145,000 Rs to establish a residential type training and rehabilitation center for the betterment and upliftment of widowed and destitute women of the society. This center, named after its founder the Tulsi Mehar Mahila Ashram has living quarters, a small community hospital, production workshops, a kindergarten school and a play area for children. The ashram offers a 2 year program free of charge with training in weaving, sewing, knitting and literacy classes to destitute women as well as education to their children. Tulsi Mehar died on September 27th 1978, shortly after the opening of the ashram. Today, the center is financed by 40% of Mahaguthi’s yearly profit and has approximately 80 women each year in its training program. Tulsi Mehar’s vision for self-empowerment and self-reliance still guides the efforts of Mahaguthi and its Ashram in its activities.