Ranjit a Psychic is madly in love with a college going beautiful girl Rekha.
Rekha who is engaged to Inspector Rakesh rejects Ranjit's love. On rejection by Rekha, Ranjit's emotions takes a different turn and he starts visualizing Rekha in every girl he sees with her lover, and commits their murder.
Rekha gets Ranjit arrested by Inspector Rakesh after coming to know from Ranjit about his killings.
In the Courtroom battle, Ranjit's counsel proves that Ranjit is not a killer but a mentally deranged dejected killer. The judge orders Ranjit ot be sent to the mental hospital.
Ranjit escapes from the mental hospital and reaches the place where the Hangama Group is celebrating the arrest of Ranjit. He threatens to kill Rekha and in the ensuring struggle Ranjit is accidentally killed by the Group. The group gets scared from the consequences of their criminal act and decides to hid the body of Ranjit in junk-yard.
The story takes a thrilling turn when Ranjit's Spirit starts taking revenge by killing one by one the boys and girls of the Hangama Group.
Everybody including the police are baffled at the ruthlessness and the method of killings.
The group ultimately decides to seek the help of a Tantrik, who agrees to tackle the revengeful wandering Spirit of Ranjit.
What happens to the Tantrik when he confronts Ranjit's Spirit? Could he overpower him?
Did the remaining members of Hangama Group also get killed? Finally could Ranjit's Spirit get peace after fulfilling his revenge?
This is all what "KHOONI MURDAA" is about.
[From the official press booklet]