Panihati is the name of a village located in the state of West Bengal, on the banks of River Ganges. This festival is also known as the festival of punishment because of the pastime described below.
Srila Raghunatha Dasa Gosvami, a personal associate of Mahaprabhu was a devotee of the highest order. In a spirit of renunciation and detachment from the material world, he wanted to leave home and join Sri Chaitanya Mahaprabhu in His mission. But Mahaprabhu objected and assured that Krishna would soon deliver him. Two years later, Nityananda Prabhu came to Panihati and stayed there. Raghunatha Dasa, who was staying in the nearby village took permission from his father and went to Panihati to meet Lord Nityananda.
At Panihati, he saw Lord Nityananda sitting on a rock under a banyan tree on the banks of the River Ganges. He was surrounded by many devotees. Raghunatha Dasa was hesitant to approach the Lord and paid obeisances from a distance. But some of the devotees noticed him and informed Lord Nityananda. Lord Nityananda called Raghunatha Dasa and said “Raghunatha Dasa! You are hiding like a thief. Now I have caught hold of you. Come here. I shall punish you today.’’ Then Lord Nityananda forcibly caught him and put His Lotus Feet on the head of Raghunatha Dasa. He ordered Raghunatha to celebrate a big festival and serve all the devotees – with yogurt and chipped rice. Hence, this festival is also known as Chida Dahi mahotsav.