In the worst floods that hit the historic capital of the Peshwas on July12, 1961, over half of Poona was submerged by the Mutha waters. Y. B.Chavan, the then chief minister of Maharashtra, surveyed the flood-hit city on July 14 and announced that 59 persons were missing, 29 bodies were recovered and 50,000 flood-stricken people needed immediate relief in the form of food, clothing and shelter.

The most worrying aspect of the floods were the cracks which had developed in the state's two important dams - at Panshet and Khadakvasla. The damages reportedly amounted to a loss of Rs 15 crores to the state. As people lined up for food and water when the floods started subsiding, stories of miraculous escape came to light. For instance, a woman climbed up a 52-foot-high tree along with her four children when waters reached the third storey of the building she was residing in. A paralytic woman and 18 others joined the family atop the tress to avoid being washed away.

To help victims of Poona floods, the Times Group announced the setting the Times of India Poona Relief Fund. The chief minister sent across a message of appreciation, noting that ' The Times of India, in keeping with its past traditions, has started a Poona Relief Fund.' Muslims, through the good offices of their leader Dr Rafiq Zakaria, contributed generously to the fund which was used to build a huge colony at the cost of Rs. 25 lakhs to house some of the thousands rendered homeless by the devastating floods.