Melkur was a statue that people looked up to and gave flowers to it - it was a monument which was in the garden of Traken

This though got taken over by the Masters TARDIS and was used as a trap for the Doctor who didn't notice the Master hidden away in the statue.

Adric was the first to notice that Melkur was a fake and really a TARDIS but were too late - as the Master had taken control of the Source Manipulator - the power of the Keeper of Traken - with it he planned to renew his life span as he was dying, The Doctor fought him and the Master fled - only took over the body of Tremas in the process.