One of the most important forms of Avalokitesvara in Nepal is Rato (Red) Macchendrenath. The sacred history of Rato Macchendrenath tells of his journey to the Kathmandu Valley at the behest of Nepal's king. At the time, Nepal was enduring the effects of a terrible drought, so the king requested that Rato Macchendrenath come from Assam to aid his people. Through his infinite compassion, Macchendrenath came to the Valley. He took the form of a bumblebee and was carried in a jar. It was intended that he come to Patan but, while on his journey, he stopped at Bungamati and liked it so much that he expressed a desire to remain there. Today, the deity is housed for six months at the Bungamati Temple and for six months at the Rato Macchendranath Temple in Patan. He moves from Patan to Bungamati at the beginning of the rainy season (approximately June), during which time, Macchendrenath is propitiated in the Ratha Jatra Festival for a successful monsoon season.

During the Ratha Jatra Festival, the Rato Macchendrenath image, accompanied by Minnath (another form of Avalokitesvara who also resides in Patan), is taken from Patan to Bungamati where the it will spend the rainy season. The Rato Macchendrenath and Minnath images are enshrined in their carts and propitiated for rain and prosperity. After the offerings are made, the carts are pulled by their devotees. Minnath's presence during this festival is important. Although it is unclear at this time, it may be that the Minnath image is invested with the presence of Rato Macchendrenath when Macchendrenath goes to Bungamati. In other words, the Minnath image serves as a surrogate for Rato Macchendrenath while he is in Bungamati (JCH).

The Festival lasts for several days and on the last day, Macchendrenath's vest is held up and displayed to the watching crowd to show that it is still in the hands of the community. It is believed that, given the proper propitiation, the rains will begin on the final day of the festival.