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Description: The situation is termed a Hung parliament. If no party has a clear majority, the President usually calls the biggest party and gives them time to prove a majority (usually about 10 days). The bigger party then goes "shopping" around for legislators. 

If the party fails to prove majority within that time period and no other party is able to attain majority, the President can dissolve the Parliament & call for an election. This is one of the powers vested with the President. In theory, the President can keep calling for elections indefinitely this way.  In practice, at some point the parties get tired of campaigning and give up the "no confidence motion" letting the opponent rule. Usually a few suitcases transfer & things get back to normal.

Prior Situations: India follows the UK model and they faced such a situation in early 1920s. Between 1922 and 1924 they had 3 elections as no party was able to prove a majority. It was a revolving door. In 1910 they had 2 elections in the same year for the same reason.

India's elections in 1996 and 1998 faced such a situation. Both those times produced indecisive majorities. After letting a hodgepodge of parties to rule for sometime, both times President Narayanan dissolved the Lok Sabha (first in 1998 and then in 1999).
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