Malhar Rao Holkar praises Ahilya for handling the responsibilities, but she wants to relinquish her duties. Dhanaji feels insulted and decides to wage a war. Malhar Rao gives Dhanaji a difficult choice to make in front of everyone in the palace. Gunoji asks Rangrao about his visit but gets no information from him. Malhar comes up with a plan to neutralize the threat on Khanderao's life but Dhanaji has a counter plan.
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