By Agence France-Presse
Enforcement Directorate investigators searched the Amnesty office in the southern city of Bangalore for several hours on Thursday. Similar action has been taken against the environmental pressure group Greenpeace.
The directorate, which investigates financial crimes, said the international rights watchdog was suspected of having channeled 360 million rupees ($4.8 million) into the country in violation of funding rules.
A directorate official confirmed the raid and said Amnesty had breached rules by "floating a commercial entity" to bring in money from abroad.
Amnesty insisted that it was "compliant" with government rules in a Twitter statement however and slammed what it called a "disturbing pattern" in the action of the authorities.
"It is clear that the government wants to instill fear among civil society organisations," said Amnesty, which has its headquarters in London.
Amnesty India spokeswoman Smriti Singh told AFP the group was not aware of any material being seized but that it was assessing events.
Amnesty has been a vocal critic of the right wing Indian government's treatment of minorities and abuses in conflict zones such as disputed Kashmir and in the campaign against Maoist militants in central India.
On October 11, the same agency raided the Greenpeace India offices in Bangalore. Authorities froze Greenpeace's bank accounts in 2015.
Prime Minister Narendra Modi's nationalist government launched a crackdown against foreign non-government groups soon after coming to power in 2014.
It suspended or barred nearly 10,000 non-profit groups, many working in health and the environment, from receiving foreign funding and accused some of using funds for "anti-national activities."
A government intelligence report in 2014 reportedly said the groups were working with foreign powers to undermine India's economic growth.
Modi has criticised foreign-backed aid organisations, terming them "five-star activists".