One day, his friend and private detective Captain Usman (Suresh Oberoi) visits him and gives him a diary along with a dagger (khanjar) to safeguard them.
Meanwhile, a smart girl named Preeti (Reena Roy) starts to flirt and get closer to him to know about the diary and the dagger.
Prakash notices her acts, and illustrates to the police the story of Usman's diary, the dagger, his murder and Preeti's attempts for them.
After a few days, his brother-in-law Ramesh (Shekhar Kapur), married to his younger sister Jyoti (Rita Bhaduri), is also found murdered.
Disturbed by these mysterious murders leading to the dagger, Prakash and his magician friends Jagat (Mehmood) and Rasvanti (Jashree T.) visit an old town, Udaigarh, famous for Swamiji (Amjad Khan).