One day both Vashishth and Vishwaamitra were sitting in Indra's court. Indra asked, "Do you find anybody who sticks to truth at this time, on earth?"  Vashishth Jee said, "Raajaa Harishchandra is like that."  Vishwaamitra said, "No, he is not."  Argument grew hotter and ended up in testing Harishchandra for his truthfulness by Vishwaamitra Jee. He vowed, "If I don't prove Vashishth wrong, I will not call myself Vishwaamitra."

Now the testing began. At one time Harishchandra had to do a Yagya, in which he had to donate a large quantity of gold. Vishwaamitra Jee went there to have that donation. Raajaa asked, "How much do you want?"  Vishwaamitra said - "When a tall person standing on an elephant throws a cowrie (shell), I need so large heap of gold."  Harishchandra readily said, " I will gladly give you this much donation. I have it in my treasury."  Vishwaamitra did not expect this reply, this was his first defeat, so he said, "Let it be in your treasury for now, when I will need it, I will come to take it."  Raajaa said, "As you wish."

Now he created many wild animals who were troubling public, so Raajaa with his wife Chandramatee and son Rohitaashwa went for their hunting. He set his camp in a jungle. Vishwaamitra Jee sent two beautiful girls in his camp. They talked to him some non-sense and Raajaa sent them back with beatings. Vishwaamitra Jee said to Harishchandra - "You have insulted my daughters, so either you give me money or marry these low-caste girls and give me my  remaining money within 48 days."  Raajaa did not want to marry those girls so he gave his kingdom including his treasury and went to Kaashee (Benaaras or Vaaraanasee). He sold his wife and son and sold himself to a Shoodra and gave all that money he got, to Muni. 

Now the buyer of the Raajaa was Vishwaamitra's disciple Nakshatrak. He made him in charge of a cremation ground. Raajaa Harishchandra's son died of a snake-bite, so his wife brought his dead body in mid-night. Harishchandra did not recognize her. He asked her to cover the body as per rules of the cremation ground. But Chandramatee didn't have any, o she had to tear her Saree (a cloth worn by Indian women)  and then wrapped him in her half Saree.

Then he asked for the prescribed fee for his cremation which was supposed to go to his master. Although she told her plight that she had wrapped her son's body in her half Saaree and she had only the other half part on her body, did he want to make her without clothes? But Harishchandra did not listen to it. So she went in the town to get that money. There she was caught by Raajaa's people for stealing the money  and Raajaa ordered for her execution. This was the duty of Harishchandra to execute her, so as he took out the sword to kill her, Brahmaa, Vishnu, Mahesh all three appeared before him and held his hand. Raajaa was  given back everything. Vishwaamitra again got defeated from Vashishth Jee.