The government will initiate a probe into reports that some banks are helping businessmen and others to illegally transfer money abroad.
On Friday, anti-corruption campaigner Arvind Kejriwal said the government had failed to punish "the big fish" on a list of 700 Indians who allegedly hold unreported accounts in the Geneva branch of HSBC. The list was given to India by France last year.
The Finance Ministry, without referring to Mr Kejriwal's allegations in a written statement on Saturday said "Information received from the Government of France has been analysed and investigations are in progress." It added, "Action has been taken on these cases and further action including assessment, tax collection and levy of penalty will be taken as per the provisions of the Income Tax Act, 1961."
Senior government officials say Mr Kejriwal has played no role in propelling the inquiry. "The government has its own source of information and we have been steadily working to crack down on this" a source said.
Separately, a discreet inquiry has already been initiated for a suspected transfer of tainted funds possibly connected to terror groups. New Delhi is apprehensive that a substantial part of this fund could have been moved for investment in the stock market.