The ostensible reason for Kumar to quit was his falling out with Deputy Chief Minister Yashaswi Yadav, the son of RJD supremo Lalu Prasad. Yadav is facing corruption charges but had refused to step down despite Kumar's exhortations.
"In the circumstances that prevail in Bihar, it became difficult to run the grand alliance government," Kumar told reporters outside Raj Bhavan after submitting his resignation to Governor Keshri Nath Tripathi.
First, Prime Minister Narendra Modi praised him for his "honesty" in standing up to corruption. Then the BJP said it would support him, and its legislators met Kumar's JD(U) MLAs.
After the meeting, Kumar, accompanied by senior BJP leader Sushil Kumar Modi drove to Raj Bhavan to stake claim to form the government.
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Modi later told journalists that a list of 132 MLAs supporting the alliance was submitted to the governor who has invited Kumar to form the government. These include 71 of JD(U), BJP 53, RLSP 2, LJP 2, HAM 1 and three Independents.
The JD(U)-BJP combine will now return to power after four years in the politically volatile state. Prodded by Kumar, the JD(U) had walked out of the NDA in July 2013 after Narendra Modi was nominated head of the BJP's campaign committee for the 2014 Lok Sabha polls.
However, the RJD appeared in no mood to give up without a fight, with Tejashwi Yadav saying he, too, would stake claim to form government.
"Have sought appointment with the governor. Will stake claim to form government as the the single largest party. Will also get the support of JD(U) MLAs who have won after defeating BJP candidates," Tejashwi tweeted.
RJD has 81 MLAs and even if Congress with 27 MLAs and CPI-ML (03) decide to back Tejashwi, their number would add up to 110.
Reacting sharply to the governor inviting Nitish Kumar for the swearing-in at 10 am after giving him an appointment for 11 am, Tejashwi said RJD would stage a dharna outside Raj Bhavan against it.
"Governor gv us time of 11AM and now suddenly has asked NDA for oath ceremony at 10AM. Why so much hurry & rush Mr. Honest & Moral?" he tweeted well past midnight.
He claimed half of JD(U) MLAs were in touch with him which forced Kumar to rush to Raj Bhavan at midnight to stake claim to form the government.
Earlier, citing irreconcilable differences with the senior ally over corruption charges against Tejashwi, son of Lalu Prasad, Kumar announced his resignation after meeting Governor Keshri Nath Tripathi, hours after the RJD supremo rejected outright the demand for his son's ouster.
Tensions simmered between the two alliance partners ever since the CBI registered a case against Lalu Prasad, his wife and former chief minister Rabri devi and son Tejashwi in a land-for-hotels case.
The offence was allegedly committed when Lalu was the railway minister in the UPA government. He was allegedly instrumental in handing over the maintenance of two hotels of Indian Railways-owned PSU ICRTC to two Patna businessmen in return for a prime plot of land in the Bihar capital where his family is now constructing a shopping mall.
Kumar responded quickly tweeting: "I thank the prime minister from the core of my heart for praising my decision (of quitting)."
The state and central BJP leadership swiftly got in touch and Sushil Kumar Modi, who was Kumar's deputy when the two parties ran a coalition government, said his party was not in favour of a mid-term election.
The development has left Tejashwi out of the government, and his father emasculated, at least for now. Also, the Congress, part of the grand alliance, stands diminished politically.
Earlier, after putting in his papers, Kumar told reporters outside Raj Bhavan he had favoured opposition unity but that was not possible when it only had a "reactive agenda".
"I favoured opposition unity...But what kind of opposition unity was going to be there...There was no discourse, no agenda. Having a reactive agenda will not do," he said.
Kumar also said that while supporting demonetisation he had called for a crackdown on benami properties and that he cannot back out now.
Several members of Lalu Prasad's family, including his MP daughter Misa Bharti and son-in-law Shailesh Kumar, are embroiled in cases related to possessing benami properties (immovable properties not registered in the name of the real owners) bought with tainted money.