After Subhas's release in March 1937, some of his friends, met in a conference and decided to raise a fund called Subhas Congress Fund. This was intended to contribute towards building an infrastructure for Provincial Congress work. A Committee was formed to plan this work. Subhas had planned for a building with a big hall, a stage, official of the Provincial Congress Committee, a library and a gymnasium. Subhas banked heavily on the public for generating the rest of the fund. He applied to the Corporation of Calcutta in July 1938 for a lease of a plot of land in Chittaranjan Avenue. Calcutta Corporation agreed to grant the lease in August 1938. The building plan got sanctioned. Poet Rabindranath Tagore was requested to lay the foundation stone of the building. He named it as "Mahajati Sadan."
TThe date for the ceremony was 19th of August, 1940. Subhas Bose was already expelled from Congress for three years by the working committee. The anti Subhas faction in Bengal did their best to dissuade the poet from participating in the ceremony. But Rabindranath, despite his ill health, participated out of his personal love and respect for Subhas Chandra Bose. Subhas in his speech said, "Gurudev, we welcome you as the High Priest in today's national festival, proceed to lay with your hands the foundation stone of Mahajati Sadan. Give your blessings so that we are able to make this the "House of the Nation" the living center of all those beneficent activities which will bring emancipation of the individual and of the Nation, as well as the all round development of the India's manhood and nationhood. Bless us that we may hasten along the path that will lead to India's liberty and to our national self fulfillment." The Poet said in his address, "Today in this great Hall of India we shall lay the foundation of Bengal's prowess but our strength will not lie in arrogant Nationalism, suspicious of friends and foes. We shall invoke Bengal's magnanimous heart of hospitality in which our humanity has liberation; we shall seek freedom in many sided cooperation." The work of the construction of the building started shortly afterwards and had to be stopped as a result of the steps taken by the Government after Subhas Bose's disappearance. ( Adopted from the memoirs of N.C Mitra - Subhas Chandra Bose - The Crisis)