Bhootnath Returns takes off from where Bhootnath ends. After Kailashnath’s( Amitabh Bachcahn ) troubled spirit having peace, Bhootnath returns to Bhootworld and we find that all things work in Bhootworld in the exact way as humans do in their lives. Just like the government offices of citizens here, there is something similar in that Bhootworld as well, where all accounts of the spirits are taken care of. Most of the spirits make fun of Bhootnath as he fails in scaring people and because of him, the terror of the ghosts among the people has started diminishing. They mock him because a kid like ‘Banku’ couldn’t be scared of him. Out of humiliation, Bhootnath wants to returns on earth to be given one chance to finally retrieve his Image as a ghost.