In July of 1850 the Bab was executed by the Iranian government. Thereafter a number of important Babis put forth extravagant claims, including, in 1851, Sayyid Basir-i Hindi of Multan. Bahá'u'lláh challenged Sayyid Basir, and asserted his own divinity instead (many Babi leaders of the time represented themselves as participating in a pleroma of divine manifestation, similar in some ways to that claimed by Sufis or mystics). In June, 1851, the vizier put pressure on Bahá'u'lláh to leave the country, which suggests that the government had by that time infiltrated the Babis and discovered who the community's real leader was. Bahá'u'lláh went to the shrine city of Karbala in Iraq, the site of the tomb of the Imam Husayn, where a small but active Babi group existed. He found that it was led by a Sayyid 'Uluvv, who had made claims to being God incarnate. Bahá'u'lláh faced the man down and convinced him to retract those claims. On the other hand, during his stay in Karbala between August 1851 and March 1852, Bahá'u'lláh told some of his close companions that he was himself the return of the Imam Husayn, whose return Shi'ites expected after the advent of the Qa'im or Mahdi.
Why so many Babis were mad at claiming divinity?
According to Samuel Graham Wilson, Opium smoking was common among the Babis.
Subh-i-Azal states in a letter to Edgard Blochet, keeper of the Oriental Manuscripts section of the Bibliotheque Nationale in Paris, that:
"I simply wanted him [Baha'u'llah] to keep his silence and not compel me to denounce him. In the end he could not contain himself, and by taking an overdose of opium, he threw down the gauntlet, lured thereunto by the temptations of the bald soap-seller [i.e. Mírzá Aqá Ján of Káshán], and by his brother [Mírzá Músá Kalím]."
There is a reference to Baha'u'llah's smoking drugs (opium) here also. Hope this book will be translated fully, some day, in proper English.