Shortly after the loss of his railway shop, the Sait, a wholesale merchant at the market who was also Raju’s creditor, arrives at the house and demands that Raju pay back the 8,000 rupees he owes him. Raju, inappropriately, is overcome with a fit of laughter. The Sait leaves, angry and offended. Raju’s mother has stopped speaking to him, although she is still civil to Rosie. She thinks that her son has ruined everything that his father built.
The escalation of the family’s troubles is marked by the arrival of the Sait, who demands his money. Raju’s inappropriate laughter during the Sait’s visit further confirms that Raju is losing control over his faculties—he seems unable to think or behave in a rational way. The deepening rift between him and his mother also points to the fact that Raju’s troubles are not only financial. His family relationships are also beginning to fall apart as a result of his ill-advised actions.
Within a few days of the Sait’s visit, Raju finds himself involved in court affairs—the Sait has brought a criminal case against him. Raju seeks Gaffur’s counsel, but he isn’t happy to hear Gaffur tell him that he must send Rosie away. Raju quarrels with him, and Gaffur leaves. With the help of a lawyer, Raju manages to get the case against him adjourned (postponed), and he tries to reassure his mother that all will be well.
The continued unraveling of Raju’s affairs suggests just what a disruptive effect Marco and Rosie’s appearance has had. As a consequence of their arrival in Malgudi, Raju has lost the railway shop, he is in conflict with his mother, and now he is involved in a court case to repay money he owes. Gaffur again shows himself to be the voice of wisdom when he tells Raju to send Rosie away, and again Raju reveals his stubbornness by quarreling with Gaffur instead of taking his advice.
Raju’s uncle—his mother’s eldest brother—appears unexpectedly one day at the house. The uncle castigates Raju. When Raju leaves him to watch Rosie practicing her dance, the uncle follows him, then insults Raju by telling him he has turned into a dancer’s backstage boy. The uncle addresses Rosie disrespectfully, alluding scathingly to her low caste and class. Rosie is devastated, but the uncle doesn’t relent, telling her she must clear out by the next train. Raju, flying to Rosie’s defense, attacks his uncle. His mother, siding with her brother, is drawn into the commotion and arrives to tell Rosie that she is a she-devil who has ruined her son. Raju’s uncle and mother are shocked when Raju puts an arm around Rosie and tells her that she is staying in the house.
The arrival of Raju’s uncle in the house leads the familial tensions to reach crisis point. The emphasis that Raju’s uncle puts on Rosie’s low caste points to his position as a proponent of traditional hierarchies. Like Raju’s mother, Raju’s uncle largely objects to Rosie’s presence in the house not only because she is a married woman, but also because of her low social status. Raju’s act of publicly putting his arm around Rosie is shocking to the uncle and mother because it represents a complete transgression of traditional social codes. Raju lays claim to a married woman by touching her in public; and in doing so, he also transgresses the boundaries of his higher caste, which would forbid such contact across caste divides.
The next morning, Raju’s uncle renews the fight by saying that the train is arriving in an hour and he asks whether Rosie is ready to leave. Raju’s mother, too, asks whether Rosie has packed her things. Raju responds by saying again that Rosie is not leaving. Raju’s mother announces that if Rosie doesn’t leave, she will. Raju’s uncle encourages his sister to pack, and Raju is saddened as he watches his mother leave the house with her brother.
The departure of Raju’s mother from the house represents the complete breakdown of Raju’s familial relations. Raju’s involvement with Rosie leads him to lose many of the links to his old life—including his mother. That Raju’s mother leaves her own house—a house she has not left in decades—indicates the extent to which she is outraged by the relationship between her son and Rosie, a relationship that violates all of the traditional principles she holds dear.
After his mother’s departure, Raju and Rosie continue living as a married couple. Rosie diligently practices her art every day, and, after several months pass, she announces that she is ready to perform. When she asks Raju what his plans are, he tells her that first, they need to come up with a more appropriate, traditional name for her public persona, and after some brainstorming, they settle on the name Nalini.
Rosie does not allow the upheaval that has taken place around her, and in which she is of course at the center, to distract her from her art. Indeed, her identity as an artist is reflected in her devotion to practicing her dance. The new name that she and Raju settle on as her stage name suggests that Rosie is about to enter a new phase in her life—one in which she casts aside her identity as a wife and takes up her identity as an artist.
Raju begins looking for opportunities for Rosie and approaches the Albert Mission School. In order to more convincingly play his part as a cultural ambassador of classical dance, he changes his appearance—dressing seriously, and sporting glasses. He invites members of the School committee to view a sample of Rosie/Nalini’s dance. Two committee members duly arrive at the house on the appointed day, and, when Rosie appears before them and begins dancing, they are dazzled. Completely enchanted by Rosie’s dance, the committee members not only agree to include her in the school’s variety show, but to cut down on the other minor entertainments so as to give her more space in the show. They also agree to provide accompanists for the dance.
Just as Rosie begins to transform herself, so Raju creates for himself a new identity. The new clothes and glasses that he wears in order to better play the part of cultural ambassador indicate his ability to shape-shift, depending on his needs. While Raju creates the opportunity for the committee members to see Rosie dance, it is Rosie’s own talent that clearly impresses them. Indeed, the complete awe that overcomes the committee members when they see Rosie dance is a further confirmation of her immense genius as a dancer—a genius that has nothing to do with Raju, but which is intrinsic to her.