The film starts with Eshwar Prasad, the home minister of Hyderabad who vows to resign from his post if the government fails to recover idols which were stolen over a period of six months. This troubles his political rivals, who forge a plan to destroy his credibility with the help of CBI Joint Director Vaishnavi Natarajan and Assistant Commissioner of Police Sampath.
The two of them plan to interrogate district collector Chanchala Reddy, a close confidante of Eshwar, who is in jail for murdering her fiancé Shakthi, who was Sampath’s brother. To avoid attention, they shift her to Bhaagamathie Bungalow, a dilapidated, supposedly haunted house in the outskirts of a village, for the interrogation. The CBI question Chanchala to get some clues against Eshwar, but she repeats that he is a good man, and that they are doubting his integrity without any proof in a cryptic but leading manner.
Later that night, the spirit of Bhaagamathie, the Queen of the house before independence, takes control of Chanchala. The CBI team calls upon a psychiatrist to investigate the matter, who concludes that Chanchala must be schizophrenic as she seems to take on a different persona and narrate some story from a book as if it were her own. He suggests that the CBI commit her to an asylum. However, Sampath suspects that this might be a ploy by her to escape and arranges for a spiritual guru to find out if there is paranormal activity. The guru suggests a few indicators. Later, Sampath discovers that those indicators to indicate the presence of ghosts in the bungalow. He also finds Chanchala hurting herself under the influence of the ghost. This leads to Sampath taking Chanchala to a mental hospital.