The present invention relates to bioactive extracts its fractions and isolation of compound from Rauwolfia tetraphylla. The extracts and fractions are useful for the treatment of psychosis based on in-vivo validation on animal model and proportional binding affinities for dopaminergic-D2, Cholinergic (muscarinic) and Serotonergic (5HT2A) receptors for antipsychotic activity. The present invention relates to novel antipsychotic activity in the leaf alkaloids of Formula 1 and 2 named tetrahydroalstonine, 10-methoxytetrahydroalstonine, isoreserpiline, 10-demethoxyreserpiline, 11-demethoxyreserpiline, reserpiline and α-yohimbine. The present invention also relates to processes for obtaining antipsychotic extracts as well as for the isolation of alkaloids of formula 1 and 2 from the leaves of Rauwolfia tetraphylla. The present invention particularly relates to significant antipsychotic activity in the MeOH extract, ethylacetate and chloroform fractions of R. tetraphylla and in the isolated compounds α-yohimbine, reserpiline and in a mixture 10-demethoxyreserpiline and 11-demethoxyreserpiline in 1:1.5 ratios for treating psychosis without any extra pyramidal symptoms (EPS).