MUMBAI: The Income Tax department has unearthed Rs 20 crore as undisclosed income from three city-builders after a raid on their premises.

"We conducted raids on three builders last week on the basis of specific information regarding concealed income. Our information turned out to be true after Rs 20 cr was recovered as undisclosed income," a senior I-T official on Thursday.

The builders will be told to explain the source of income and if found that there was tax evasion, they have to pay 40 per cent tax on it.

"Along with it, they have to pay penalty of 100-300 per cent on the amount of tax. They will also have to pay interest on the tax amount," the official said.

He also added that apart from the undisclosed sum, little over a crore of rupees was found in cash with the builders at their premises.

"We are still assessing as the total undisclosed income could be higher. What we have got now is from our preliminary assessment," he said.