The 20-seater small plane, owned by the government-run Nepal Airlines Corporation, was discovered scattered in pieces over a hilly area along with the bodies of all the 18 people on board.
"The probe committee will study several aspects of the plane crash, including the reason behind it and the course of action to be taken," Mohan Krishna Sapkota, spokesperson of Nepal's Tourism and Civil Aviation Ministry, told Xinhua.
The probe committee, headed by former director general of Civil Aviation Authority in Nepal Tri Ratna Manandhar, has been given a mandate of 60 days beginning from Monday.
"The committee has also been asked to recommend about Nepal's air safety situation," added Sapkota.
Government officials and security personnel have brought to Kathmandu the badly burnt bodies of all victims of the crash.
Medical officials have begun the postmortem at a Kathmandu hospital to find out the reason behind the deaths and also to ascertain the identities of the deceased.