Some of the decisions made by the cabinet of the coalition government formed in Chaitra 2053 were focused on personal and group interests. Due to the weak leadership of Prime Minister Lokendra Bahadur Chand, Home Minister Bamdev Gautam seemed very powerful.

The power of the Home Minister increased further after the UML won a majority in the local elections held on Jestha 4 and 13, 2054. Because, when the opposition was accusing the widespread misuse of state resources in the elections and the use of force to suppress the opposition, UML Chairman Manmohan Adhikari had thanked Bamdev. After Chairman Manmohan thanked him for helping his party win many seats, Bamdev's effective interference in the cabinet increased even more. Prime Minister Chand was also forced to keep the coalition government by appeasing the ministers. RPP General Secretary and Foreign Minister Prakash Chandra Lohani had even resigned, saying that Chand was innocent in the government. Therefore, evidence that the government is arbitrary and decisions linked to personal interests and commission games were quickly made . 

In this background, the incident of Nepal Oil Corporation increasing the prices of petroleum products as per the decision of 2054 Jestha 31 by the Chand-led coalition government not only attracted a lot of criticism, but also the Public Accounts Committee of Parliament and the authorities intervened in the government . When the corporation's opaque transactions and the practice of hiring employees one by one by one by the minister were becoming more and more widespread, the general public did not consider the price increase to be natural . When the price of petroleum products fell in the international market, the 'commission game' came to the surface after it was revealed that some government ministers had increased the prices with the informal consent of some ministers. In particular, there were voices that the then Minister of Supplies Gajendra Narayan Singh had appointed petroleum product traders to the board of directors of the corporation and had decided to affect the daily lives of the general public by not increasing the prices as per the formal proposal to serve someone's interests . 

During the fall of Sher Bahadur Deuba's government on Chaitra 23, 2053, Minister of Supplies Singh suddenly came out in favor of Chand. After the fall of the Deuba government, Singh became the Minister of Supplies again. It was estimated that the government was forced to increase the prices of petroleum products to pay for the mistakes he made during the formation of the government. The government had increased the prices of petrol, diesel and cooking gas. Petrol was increased by Rs 5, diesel by Rs 3.50, kerosene by Rs 1.50 and gas by 60 percent. The government had claimed that the price increase had to be made because the corporation was in deficit.

Members of the Accounts Committee had claimed that the proposal to increase the prices was not formally submitted to the Council of Ministers but was decided only on the advice of two ministers, including the Prime Minister and Deputy Prime Minister, in a meeting. In a discussion held in the Accounts Committee on 20 Ashad 10, 2054, committee member Birodh Khatiwada claimed that the price hike was the result of an informal discussion between Prime Minister Chand, Home Minister Gautam, Finance Minister Rabindranath Sharma and Supplies Minister Singh. Prime Minister Chand, Home Minister Gautam, Finance Minister Sharma, Supplies Minister Singh and Health Minister Radhakrishna Mainali were present in the meeting of the Accounts Committee. The government had stated that the main reason for the price hike was that the corporation was in deficit. However, the accounts of the corporation had not been audited for 7 years. However, details of the deficit had been presented for nine months.

In the Accounts Committee meeting, ruling party MP and UML Standing Committee member Khadga Prasad Oli presented data that the corporation was not in deficit. Oli, who was also a member of the Accounts Committee, had said in the meeting, ‘The corporation has made a profit of Rs. 858.8 million from 2046 to 2052/53.’ He claimed that the government had increased and decreased prices on a whim without analyzing the overall economic situation. In the committee meeting, Finance Minister Sharma had informed that there was 'overstaffing' in the Corporation. He had said that there were too many employees not only in the Corporation but in all institutions and that they were recruited by us (the political leadership). Finance Minister Sharma had claimed in the Accounts Committee that even if the employees were to be cut, the loss could be much less.

Investigation by the Authority

The Authority had started an investigation saying that the benefits of oil traders operating the Corporation were linked to the price increase. When Singh was the Minister of Supply in the Deuba-led government, a year and a half ago, he had appointed a businessman who did business with the Corporation as a director. At that time, there were voices that his appointment was against the law. But even then, the appointment against the rules was ignored in order to play a role in sustaining the Deuba government. But the Authority was investigating the matter.

The investigation file was shelved because there was no commissioner in the Authority. The Authority had informed that it would open the file after the price increase. Nepal Dealers Association General Secretary Saroj Pandey had said that it was ridiculous for the government to argue that the price of oil had increased in the international market. Businessmen had criticized the government, calling the corporation a white elephant and saying that citizens had to pay a high price to provide facilities and bonuses to employees. Businessmen had also demanded action against those involved in financial scams.

Madhav's memorandum to Bamdev

UML General Secretary Madhav Kumar Nepal had submitted a memorandum to his party's Deputy Prime Minister and Home Minister Bamdev Gautam opposing the price increase. General Secretary Nepal had demanded that the price increase increased by his own party be reduced. He had urged the government to withdraw the price increase, saying that it had broken the agreement between the government and his party. Nepali Congress and the United People's Front had made public the view that the government had committed a crime by increasing the price of petroleum products. Prime Minister Chand had informed the Accounts Committee that the decision to reduce the price was taken after widespread opposition to the government.