We have all heard the story in which Lord Hanuman had once set the entire Lanka on fire. We believe that it was the Ravana and Lord Rama rivalry that made this incident happen. But it is just a part of the whole story behind it.
In a world where incidents are inter-connected and where your Karmic account is what matters the most, there is another history behind the most beautiful palace being burnt.
Lord Shiva lived on the Kailash Parvat with his consort Goddess Parvati. Goddess Parvati and Goddess Lakshmi are sisters. So once, Goddess Parvati invited her sister for dinner at her house. With some presents and all the respect, Lord Vishnu and Goddess Lakshmi arrived at her house.
As they were having dinner, Goddess Parvati observed that Goddess Lakshmi was shivering with cold. Not being able to make her sister comfortable in her house was disappointing for Goddess Parvati. When the dinner was over and the deities were to leave, Goddess Lakshmi also invited both Lord Shiva and his consort to their place for a dinner the next day.
Lord Shiva and Goddess Parvati went to the palace of Lord Vishnu and Goddess Lakshmi. As she saw the beauty of the great palace, a desire came in Goddess Parvati's heart as well to have such a palace as her house. For a few days after the meeting, Lord Shiva kept observing that the goddess was a little upset.
When he spoke to her about it, the Goddess expressed her desire and asked him to fulfil it. However, Lord Shiva explained that since her husband (Lord Shiva himself) was a sage, and she being the wife of a sage, they should not live in a palace.
However, the thought of Goddess Lakshmi shivering with cold made her feel helpless and therefore she insisted before Lord Shiva on having a nice palace as their house. Therefore, Lord Shiva agreed to her request and soon sought the help of Lord Vishwakarma asking him to create a palace for the Goddess.
Lord Vishwakarma, the divine architect thus created the palace of gold which came to be known as Swarna Mahal of Lanka, the palace of gold.
Delighted to have got a beautiful palace, Goddess Parvati invited all the gods, goddesses and various divine sages for a feast. The hosts, Lord Shiva and Goddess Parvati also gave presents and donations to the guests. However, sage Vishwa, one among the divine sages, asked the palace itself as a donation from Lord Shiva.
Hence, he had to give away the palace to the sage. Well, Goddess Parvati did not like this behaviour of the sage and thus cursed that the palace would one day get reduced to ashes.
According to the Ramayana, written by Valmiki, Ravana was the grandson of sage Pulatsya and the son of sage Vishwa. Thus, due to the curse, there came a day when the curse given by Goddess Parvati worked and the entire palace was burnt to ashes.