In the last three financial years (FY 2009-10, 2010-11 and 2011-12), undisclosed income of Rs.28,040 crore has been detected by the Investigation Directorates of the Central Board of Direct Taxes(CBDT). Several searches were conducted on the basis of information received relating to assets held abroad by tax residents of India. Disclosure of details regarding assets held abroad is being made mandatory in the income tax returns. Non-furnishing of such information in the income tax returns, and its subsequent detection, will invariably lead to prosecution under the Income Tax Act.
Searches are conducted under the Income Tax Act on the basis of credible information regarding tax evasion after conducting necessary verification. Information technology tools such as ITDMS have been developed and are being extensively utilized to process and verify information before taking intrusive action. The Supreme Court of India, in Civil Appeal No.7914 of 2009, has observed that any bona fide measures taken in public interest, and to provide public safety or to prevent circulation of black money, cannot be objected as interference with the personal liberty or freedom of a citizen. Due to intrusive action, such as searches in residences or at airports, "certain hardship and inconvenience is inevitable, and should be accepted with grace, patience, and discipline" as it is for the citizen's "own interest", observed the Apex Court.