Every year, this pumpkin-headed, pumpkin-boobed witch shows up with an army of Punkins and haunts Lanthorne for a few days.
It always turns out it was just Pepita. That jack-o-lantern fell on her head. Every year. It's possible it possessed her, but it's also possible she was just disorientified and simply convinced herself that she was possessed. Pepita is more known for her boobs than her smarts.