Khalujan, played by Naseeruddin Shah, and his clever nephew Babban, portrayed by Arshad Warsi, are a notorious duo that finds themselves in quite a predicament after successfully masquerading as a Nawab and his attendant to escape with a coveted necklace from a jewelry store. However, chaos ensues during a police chase, leading to their separation and Khalujan sustaining injuries. To cover his tracks, Khalujan pretends to have dropped the valuable necklace before they part ways, leaving Babban under the assumption that his uncle has either been captured or killed.
Fast forward a few months, and Babban is on the hunt for Khalujan once more, this time presenting himself as Iftikar Hussain, the Nawab of Chandipur, at a poetry competition known as a Mushaira. This event is organized by the beautiful and widowed Begum Para, played by Madhuri Dixit, who is honoring the wishes of her late husband. The winner of this contest will earn not only the Begum's hand in marriage but also the title of Nawab of Majidabad.
As the opening night unfolds, Babban finally locates Khalujan, who reveals that the necklace was indeed lost. Amidst the unfolding drama, Babban finds himself infatuated with Muniya, the Begum's charming assistant, portrayed by Huma Qureshi. Meanwhile, Khalujan has his sights set on marrying the Begum for her wealth. Their ambitions, however, are thwarted by a local MLA-gangster, Jaan Mohammed, played by Vijay Raaz, who poses as a poet and uses the talent of a captive poet Nawab Italwi, played by Manoj Pahwa, to further his twisted agenda. Jaan sees Khalujan as a major obstacle in his pursuit of the Begum.
Complicating matters further, Jaan holds the deeds to Para's mansion, which he had mortgaged from her late husband. He pressures Para to choose him as her next suitor. As the plot thickens, a scheme to kidnap the Begum comes to light. Unexpectedly, Muniya turns out to be involved, initially negotiating with a kidnapper in the marketplace. However, her plans take a turn when the kidnapper is apprehended by the police. Undeterred, Muniya shifts her focus onto Babban, seducing him into participating in the Begum's abduction.
Babban, oblivious to the brewing conspiracy, attempts to confide in Khalujan about what’s to come. Yet, Khalujan, who is genuinely smitten with the Begum, decides against any violent action and chooses instead to express his true feelings to her, even as Para hesitates, considering his words as mere jest. In a bid to win Para's affection, Khalujan tries to return the very necklace they had stolen, but by the contest's finale, all hopes are dashed when the Begum chooses Jaan Mohammed as her future husband and the new Nawab of Majidabad.
Crushed, Khalujan confronts the Begum, armed and determined, only to find her abruptly kidnapped by a masked man. Following a heart-racing pursuit, Khalujan discovers that the masked figure is none other than Babban and that the Begum orchestrated her abduction as a gambit to extort a hefty sum from Jaan Mohammed, who is now the to-be Nawab. That night, the truth unfurls in a shocking revelation that Muniya and Para are not just partners in crime but lovers.
As the layers of deception unfold, Para shares the backstory of her loveless marriage, revealing that her husband was gay and had no desire for intimacy with her. Feeling trapped, she concocts the kidnapping plan to escape her financial struggles. Babban sets a meeting with Jaan Mohammed at the railway station for a ransom exchange, but when they arrive, they find the bag empty and themselves surrounded by Jaan's henchmen.
In a fortunate twist, Nawab Italwi makes a dramatic entrance with law enforcement, sparking a chaotic shootout. Amidst the commotion, Begum and Muniya manage to evade capture, leaving Babban and Khalujan behind to face arrest. After a month and a half in custody, they finally receive bail along with a cryptic message from Begum and Muniya, who have settled in an undisclosed location after selling the necklace. The closing scene leaves the duo once again encircled by Mushtaq and his gang, ensuring that their misadventures are far from over.
