Karan Singh lives a wealthy lifestyle in a palace along with his widowed mother, an elder brother, Shamsher, his wife and daughter, Meena. His mother, Rani Maa, spent most of her time playing cards, and left his upbringing on his nanny, and as a result Karan ended up believing her to be his real mother. Now matured, a womanizer and alcoholic, he comes to the rescue of a former air-hostess, Lata, who is being molested by her boss, hires her as his Secretary, and even permits her parents, sister and brother, to move into one of his cottages. Lata attempts to change his bad habits, initially meets with opposition, but does eventually succeed, and both fall in love with each other. Karan even builds a palace and names it 'Prem Nagar'. Their idyllic romance is shattered when Lata is accused of interfering in palace affairs and stealing a valuable necklace - with her very own mother testifying that she found it on Lata's purse - and as a result a much-humiliated Lata quits and her family moves out. The question remains: did Lata really steal this necklace?