In 1992, in a situation of economic crisis and chaos, with spiralling prices as a result of implementation of changes in policy of the new Nepali Congress government, SJM and CPN (UC) stepped up their political agitation.
The Joint People's Agitation Committee had called for a 30-minute lights out in the capital, and violent erupted outside Bir Hospital when activists tried to enforce the 'lights out'.
The Human Rights Organisation of Nepal estimated that 14 people, including several on-lookers, had been killed in police firing.
The hardline faction (which would later rename itself as Communist Party of Nepal (Maoist) in 1996) under the leadership of Prachandra and Dr. Baburam Bhattarai launched a parallel SJM.
The mainstream group, led by Niranjan Govinda Vidya and Nirmal Lama was the one accorded the recognition by the Election Commission to the name SJM.