We present a detailed study of McNeil's nebula (V1647 Ori) in its ongoing outburst phase starting from 2008 September to 2013 March. Our 124 nights of photometric observations were carried out in optical V, R, I, and near-infrared J, H, K bands, and 59 nights of medium-resolution spectroscopic observations were done in the 5200-9000{AA} wavelength range. All observations were carried out with the 2m Himalayan Chandra Telescope and 2m IUCAA Girawali Telescope. Our observations show that over the past four and a half years, V1647 Ori and region C near the Herbig-Haro object HH 22A have been undergoing a slow dimming at a rate of ~0.04mag/yr and ~0.05mag/yr, respectively, in R band, which is six times slower than the rate during a similar stage of V1647 Ori in the 2003 outburst. We detected change in flux distribution over the reflection nebula, implying changes in circumstellar matter distribution between the 2003 and 2008 outbursts. Apart from steady wind of velocity ~350km/s, we detected two episodic magnetic reconnection driven winds. Forbidden [OI]{lambda}6300 and [FeII]{lambda}7155 lines were also detected, implying shock regions probably from jets. We tried to explain the outburst timescales of V1647 Ori using the standard models of the FUors kind of outburst and found that pure thermal instability models like Bell and Lin cannot explain the variations in timescales. In the framework of various instability models we conclude that one possible reason for the sudden ending of the 2003 outburst in 2005 November was a low-density region or gap in the inner region (~1AU) of the disk.