During Damodar's last journey, Ellis warns Nelson. Happy with Nelson's success at killing Damodar, Lord Dalhousie reinstates Nelson and promises him the post of Assistant Governor General if he kills Gangadhar. Amidst tears, Damodar is buried with his toy horse. A mournful Laxmi Bai misses Damodar. She apologises to Anand Rao for immersing herself in her grief and neglecting him. Feeling dejected and incapable, Gangadhar finds no purpose in life. Laxmi Bai urges him to find solace in Anand Rao.