During the Japanese invasion of Malaya in December 1941, bombs were dropped on Penang. As the British had evacuated, Manicasothy took charge of raising the white flag at Fort Cornwallis, thus declaring Penang an 'open city'. He was accompanied by Harold Speldewinde and Gopal, who climbed the flagpole to take the flag down. He became chairman of the Penang Service Committee which had its headquarters at 10 Scott Road. He pressed the Penang Volunteers, who had been left behind with arms, into service to act as Volunteer Police; this was made up largely of the Eurasian Volunteer Company under Capt. Willweber and the Chinese Company. Manicasothy gave orders for saving the rice, clearing away the dead, safeguarding and issuing petrol, and forming the guards to preserve order and prevent looting. For all this, Manicasothy became known as the man who 'saved' Penang at the outbreak of the Japanese invasion. He was interned during the Japanese Occupation.