The fire was sparked by a traditional oil-fed lamp at the house of Man Bahadur BK quickly spread onto nearly houses.
As many as 15 LPG gas cylinders blew up, razing down food items, clothes, furniture and all other belongings in all 40 houses, according to a local, Shyam Das Pandey.
Similarly, there people were reported hurt in the blaze.
The firefighting team of Nepal Army mobilized five fire brigades to douse the massive fire.
Further details of the incident are awaited.