Shyam finds a paying guest accommodation at Babu Rao Apte’s (Paresh Rawal) House. He’s a garage owner and a drunkard and deep down in debts, but he has a heart of gold. There’s a paying guest who is already staying at Babu Rao’s house…Raju (Akshay Kumar) but has not paid the rent since the past two years. He’s lied to his mother, whom he’s kept in an ashram in the same city, that he’s a very big businessman in Calcutta and soon he’ll take her out of the ashram, to a very big apartment. Kharak Singh (Om Puri) who’d given Shyam a loan of thirty thousand rupees has to get his sister married and requires that money. Shyam becomes desperate about the job, only to lose it to Anuradha. He would have fought it out with the bank authorities but when he sees the condition of Anuradha’s house he withdraws, as her conditions seemed to be more pitiable with her ailing mother at her care.

But a threat call…a wrong number…which accidentally reaches them shows them a way to achieve a few lakhs. Kabira (Gulshan Grover) a known criminal has kidnapped the granddaughter of a big industrialist and he demands a ransom on a wrong number by mistake, i.e Babu Rao’s phone. In turn, they call up the industrialist and pose as Kabira and demand twice the ransom’s amount, from the industrialist. They become the middle men to earn a few lakhs. But unexpectedly when the police get involved in the case, the whole plan turns risky, their first attempt fails and then, these simple beings, dare to make a second attempt. Forced by their respective compulsions and the need for money, they do make the second attempt and succeed…

But only to get ditched by Raju…who runs away with the ransom money? What happens to the expectations, desires and dreams of this innocent yet desperate trio is the story of Hera-Pheri.