It's worth noting that not everything that happened in the Dragon Ball/Z anime is canon. From the Dragon Ball Wikia:
Episodes often include filler, which is material that was not in the manga. This is due largely to the manga and the anime being produced in parallel; it was often necessary for the anime to add filler material to keep from getting ahead of the manga. These extended sequences often add detail to the back story. The original Japanese version is considered by some to be a more authoritative source than other dubs due to occasional translation errors. Some of the filler contradicts later additions made by Toriyama itself, like Dragon Ball Minus.
As you can see from the Dragon Ball Wikia page on Shula, he never appeared in the manga and thus was not a true canon character. Thus, if there is something with a higher "canon priority," such as Dabura being the ruler of the Underworld, that would take precedence over a filler character such as Shula. While this answer may leave something to be desired, there aren't any better explanations, unfortunately.