DNS resolution stops working after some time

DNS resolution stops working after sometime (usually 10-20 minutes) in Lubuntu 15.10

The problem can be temporarily corrected after restarting network-manager using systemctl, but it starts again after 10-20 minutes. Looks like network-manager is not configuring dnsmasq properly.

Output from 'nslookup google.com':
~~~~~
Server: 127.0.1.1
Address: 127.0.1.1#53

** server can't find google.com: REFUSED
~~~~~

Output from 'tcpdump -i lo port 53' while running above command:
~~~~~
20:16:59.235879 IP localhost.38045 > comp0.arhome.info.domain: 28529+ A? google.com. (28)
20:16:59.286851 IP comp0.arhome.info.domain > localhost.38045: 28529 Refused 0/0/0 (28)
~~~~~

ProblemType: Bug
DistroRelease: Ubuntu 15.10
Package: network-manager 1.0.4-0ubuntu5.1
ProcVersionSignature: Ubuntu 4.2.0-18.22-generic 4.2.3
Uname: Linux 4.2.0-18-generic x86_64
ApportVersion: 2.19.1-0ubuntu5
Architecture: amd64
CRDA:
 country IN: DFS-JP
  (2402 - 2482 @ 40), (N/A, 20), (N/A)
  (5170 - 5250 @ 80), (N/A, 20), (N/A)
  (5250 - 5330 @ 80), (N/A, 20), (0 ms), DFS
  (5735 - 5835 @ 80), (N/A, 20), (N/A)
CurrentDesktop: LXDE
Date: Wed Dec 2 20:14:32 2015
IfupdownConfig:
 # interfaces(5) file used by ifup(8) and ifdown(8)
 auto lo
 iface lo inet loopback
InstallationDate: Installed on 2015-09-25 (68 days ago)
InstallationMedia: Lubuntu 15.04 "Vivid Vervet" - Release amd64 (20150422)
IpRoute:
 default via 172.16.84.1 dev wlan0 proto static metric 600
 172.16.84.0/22 dev wlan0 proto kernel scope link src 172.16.84.50 metric 600
 200.1.1.2 via 172.16.84.1 dev wlan0 proto dhcp metric 600
NetworkManager.state:
 [main]
 NetworkingEnabled=true
 WirelessEnabled=true
 WWANEnabled=true
 WimaxEnabled=true
SourcePackage: network-manager
UpgradeStatus: Upgraded to wily on 2015-11-06 (25 days ago)
nmcli-dev:
 DEVICE TYPE STATE DBUS-PATH CONNECTION CON-UUID CON-PATH
 wlan0 wifi connected /org/freedesktop/NetworkManager/Devices/1 nn0.arhome.info bab29dc2-8a79-4170-8253-277286712124 /org/freedesktop/NetworkManager/ActiveConnection/0
 eth0 ethernet unavailable /org/freedesktop/NetworkManager/Devices/2 -- -- --
 vboxnet0 ethernet unmanaged /org/freedesktop/NetworkManager/Devices/3 -- -- --
 lo loopback unmanaged /org/freedesktop/NetworkManager/Devices/0 -- -- --
nmcli-nm: Error: command ['nmcli', '-f', 'all', 'nm'] failed with exit code 2: Error: Object 'nm' is unknown, try 'nmcli help'.