Garak exploded his own shop, because he saw a Flaxian assassin lurking around the station, realized he was probably being targeted, and decided to force the issue. This is, you’ll pardon me for saying, classic Garak, a duplicity so straightforward it’s practically routine. The truth comes out about halfway through the episode, and the best part is, it doesn’t really matter. On another show, the reveal that the supposed victim was actually behind the attack would be a third act twist; here, it’s a stratagem to maintain control and smoke out the real culprits, as well as ensure the sympathy and assistance of outside parties.

That’s telling, by the way. Instead of seeing the Flaxian and reporting him to Odo, Garak uses a lie to help find the truth. This is how he thinks: The simplest approach to any problem is the one which requires the most lies. He’s probably even right. While Odo is undoubtedly driven to maintain order and justice on the station, any report from Garak would’ve been met with suspicion, if not outright disbelief. By framing his potential killer, Garak ensures that he’s given at least some benefit of the doubt.