Kappal Muthalaali movie is about a central government employee Thulaseedharan (Ramesh Pisharady) who is son of an employee in a passport office. The father died while at office. Later Thulaseedharan got the job of father by the consideration of die in harness. But to clear his debt, Thulasi decided to take voluntary retirement.
From the amount he received from voluntary retirement, he bought a plot for building a resort. Nearer to his new plot was the house of Gulf Chandi (Jagathy Sreekumar). Chandi has no children and he loved his car like his own child. After buying the plot Thulaseedaran built compound wall for the property. This wall blocked the entry to Chandi's house. Due to this issue Thulasi and Chandi became enemies.
When the resort's work was in progress the workers got the remains of an old ship. The archeology department notified this place heritage. As he knew his effort to build a resort in that property will become futile, he decided to sell the plot. He approached Chandi for the purpose.