Amnesty International has condemned what it described as an “assault on civil society” in India after its office in the south of the country was raided by tax authorities.

Amnesty India’s bank accounts have been frozen after tax investigators spent more than 10 hours searching the Bangalore headquarters of the London-based organisation on Thursday.

Staff were ordered to remain in the office, shut their laptops and not use their mobile phones during the search, an Amnesty statement said.

India’s enforcement directorate said in a press release it believed Amnesty had received £3.8m in foreign funding without permission.

Narendra Modi’s government has blocked more than 19,000 NGOs from receiving funds from overseas for violations ranging from not filing the appropriate paperwork to engaging in “activities not conducive to the national interest”. It says it has reduced the total flow of foreign funds from £1.6bn in 2014 to £691m last year.

Overseas funding of charities is an object of suspicion to many in India’s political establishment, who accuse NGOs of pushing foreign influence, stymieing economic growth and coercing people to convert from Hinduism – a highly sensitive issue, especially to the country’s powerful Hindu nationalist movement.

Shortly after Modi’s election in 2014 an intelligence report was leaked to the media accusing NGOs of reducing India’s GDP by 2-3% each year by campaigning against projects the government said were crucial to economic growth.

Greenpeace was singled out and has since repeatedly been threatened with having its registration cancelled over alleged financial irregularities that the organisation claims are mostly trivial or deliberate misreadings of its books. The environmental group has repeatedly had its accounts frozen, including earlier this month.

The enforcement directorate accused an Amnesty entity, the Amnesty International India Foundation Trust, of establishing a separate commercial entity to receive foreign funding after its licence to take the money directly was denied.

The head of Amnesty in India, Aakar Patel, said its structure was no secret and had been publicised on its website for the past four years. “Government authorities are increasingly treating human rights organisations like criminal enterprises,” he said.

“As an organisation committed to the rule of law, our operations in India have always conformed with our national regulations. The principles of transparency and accountability are at the heart of our work.”

He said India was undergoing a period of repression similar to the 1975 “Emergency” when the then prime minister, Indira Gandhi, suspended many constitutional liberties.

“Sadly, those dark days are now casting a shadow over India again. Instead of protecting human rights, as it vowed to do, the government is now targeting the people who fight for them,” Patel said.

Three UN special rapporteurs have previously urged Modi to repeal the Foreign Contribution Regulation Act, which they said was being used “to silence organisations involved in advocating civil, political, economic, social, environmental or cultural priorities, which may differ from those backed by the government”.