Investigators knocked on the BCC doors on Tuesday morning and they are still present at the site, the New Indian Express newspaper reported.
People familiar with situation told the newspaper that representatives of the tax department were making copies of the organization's electronic and paper financial reports, as well as copying information from a number of computers and mobile phones.
Tax officials are speaking to BBC staff in the finance and some other departments despite the fact that other employees and journalists were allowed to leave on Tuesday evening, the media said.
On Tuesday, the Income Tax Department released a statement regarding the situation with the BBC, accusing it of "deliberate non-compliance with the Transfer Pricing Rules and its vast diversion of profits."
"In the case of the BBC, there has been persistent non-compliance with the abovementioned rules for years. As a result of the same, several notices have been issued to the BBC. However, the BBC has been continuously defiant and non-compliant and has been significantly diverted their profits," the department said, as quoted by India.com.
The BBC, in turn, said it was "fully co-operating" with the Indian authorities.
Scandalous BBC Documentary
In January, the BBC broadcasted a documentary "India: The Modi Question", which is based on an unpublished Foreign Office report received by the BBC questioning Indian Prime Minister Narendra Modi’s actions during the 2002 Gujarat riots.
Back then, the civil unrest which resulted in almost 800 deaths of Muslims and 250 deaths of Hindus. Modi served as Chief Minister of Gujarat at that time.
The Indian Foreign Ministry labeled the film "hostile propaganda and anti-India garbage" with a "colonial mind-set". The ministry of information ordered a block of fragments of the documentary on YouTube and Twitter.