Here is my story. TWIW
We keep bumping into topics such as authorities doing a "cover up", of police being "clueless" and the modern day term called as "Hindu Terror". To understand why the above are all happening (or looks like happening), I think we need to go back to pre 90s era and understand (1) how riots are triggered between Hindus and Muslims (2) reasons for the clashes and (3) handling the riots and return to peace.
Pre-1990s
Other than few real emotional clashes (Ayodhya movement, 1993 Bombay riots) most of the times it is always trigger the anger and later control the anger with a goal in mind. The goal is to polarize the Muslim vote bank or to change a factional Congress CM by another. The triggers used to be handiwork of central congress leaders or some powerful regional satraps from the congress party.
For everything you need goons/handlers. These goons have to do things like throwing killed cow or killed pigs in localities. Then if no one reacts, they have to react on behalf of the community. Once the reaction happens if the scale has to be shown big, they have to burn houses and shops. If the scale was not acceptable, they need to rape women and kill people.
By the way the police, CID, IB and all those forces know that who does these things. Their only business is to follow orders and nothing to be innovational. They do arrests and releases per instructions. Some of them do innovational things and get transfered. Some of them collect their moolah and do according to instructions.
The local Muslim ghettos will be made to think that their only saviours are the goons. The police arrest them so that they get the sympathy. They get released and the party gives money to the goons so that they can bring the sympathetic folks to the polling booths. It is an engine of polarization. The party and the muslim goons being part of the well oiled system. Quota system was also implemented Per this system only so and so number of people can be killed or so and so number of things can be damaged etc.
Any such system cannot run forever. Things will slowly be known and other parties also can do similar stuff and owners of the goons change too. On top of that same goons are used by Pakistan. Global ummah driven motivations started creeping into the goons. Number of goons increased as all these ghettos does not have proper education. Arms, ammunition and other goodies started flowing. The sources of money increased. Now the party started asking police to keep a tab on localities because the controlled triggers are in the hands of several forces.
Then came the blunders of next generation congress leadership. Ram Temple's lock was opened. It actually became difficult for money taking goons to convince the communities to vote congress party when there are several competing seculars.
The police looked weaker in lot of places because of the equipment, patronage of system and other factors. They started attacking police. As government started losing a tight grip the police and intel started taking a firm grip. The police which is mostly majority community and in spite of corruption did have sympathies with anti-Muslim forces. When the system collapsed, they did a lot of cleanup and cleanup was not structured and at lot of places it was collateral damage.
All the while there are equal number of goons on the non-Muslim sides but were never well fed because they don't need any grand polarization. One or two castes will vote based on favoritism etc. Muslims are the only real one who needs to be kept in the grip using fear tactics. Now as the party weakened and police started taking control in an unstructured way the Hindu warriors started getting prominence. The anger of Hindu warriors at local levels is always there and there is a burning desire to be part of cleaning up (this includes material stuff too like real estate grabbing)
This does not mean the sleeper cells are gone by any means. Instead of being controlled, goons do have other means with external support and weakened political atmosphere and a new number of willing partners like Mulayams, Laloos etc instead of just one INC.
The goons that I referred above are the INC Muslim cadre, SIMI and now IM. Period. The visible ones got into electoral politics. The rapists, home burners are like cooperators, ward members in the Muslim ghettos.
NDA timeline
Suddenly, there is a government that does not know how to deal with this menace of sleeper cells that were grown under the umbrella of INC and its establishment. On top of that ISI is all over India and these are good handles to do destruction at will. However, it has willing Police forces who want to help and also a passionate Hindu warrior groups who want to be part of this cleanup.
There are few times in India, riots duration was used by police to clean up the sleeper cells. Mumbai riots under congress rule, Diggy Raja was a great (no sarcasm) administrator and they wiped out streets of Mullahs during his rule. Later post Godhra riots are used to wipe out a lot of sleeper cells.
NDA is the government which replaced a mightily established and rooted system and while it was trying to find clues to get over one crisis after another(Kargil, Kalachuk, Akshardham, Parliament etc.) it probably started during its end period with a structure and plan in place to do a real cleanup of these sleeper cells. Again clean up = killing SIMI a.k.a IM a.k.a INC Muslim cadre. Doing this directly in encounters etc means a backlash. How to do quietly? They adopted a two pronged strategy.
(1) POTA to kill/arrest with no means to easily get released
(2) Infiltrate into sleeper cells and put a wedge between the various elements. Purohit et al are the ones who were probably spearheading this with the approval of intel and Government. (Note: Not all are done by them. Definitely not something like Samjhuta express)
This would have created rifts between the various sleeper cells. The idea would be to pit one underworld over another one. Dawood Vs Chota Rajan type stories.
UPA timeline
During the off time of Congress party for a decade, they realized one thing. If we do not have Muslims with us we are nothing electorally. Do everything to help the goons so that they will bring back the voters to booths. Terror, SIMI, IM is all damn bullshit. They lost UP and Bihar to fourth position is just because of losing all these goons and votes to other seculars. They have to go overboard to convince and get back all these goons and give them handles and issues.
To convince:
(1) wind up POTA
(2) wind up sleeper cell busting mission. Convert it to Hindu Terror
(3) pardon, allow terror activities in a controlled fashion. All except 26/11 are minor and controlled ones.
(4) Create confusion with too many names while investigating the terror attacks. Finally convert this into some Hindu terror stuff as it is always there as a tool.
(5) Batala House encounter - blame the police.
How much this will help them in getting back to older glory is all difficult to predict but that is their significant to become relevant again from a 120 seat after PVNR to 207 in 2009.
Now Hindu terror can be used to discredit several things too