New Delhi (PTI): With Indian art market estimated to be worth more than Rs 1,000 crores, the Income Tax department is now closely monitoring various art galleries for tax evasion, especially in the wake of country's first-ever India Art Summit currently being held in the capital.

Highly placed sources in the department have said that the three-day Art summit, which began on Friday, is being "closely monitored" by the department.

"A lot of people have now started investing in art and subsequently evading tax by under-valuing their purchase," an official involved in the exercise said.

The Summit that has brought together 35 top galleries from India and overseas, collectively showcasing above 400 artworks will witness a number of such potential investors, the official said.

Art galleries and art houses came under the I-T scanner since the last couple of years, when huge tax evasions by the same were unearthed by the department.

This tax evasion was done by under-reporting, under-invoicing and understating the transactions, the official said.

"A lot of imported art work was even not listed in the brought-in items by some art galleries a few years ago," he informed.

Keeping this in mind, the I-T department has constituted a special team for valuation of art works that are bought and sold during such events.

The team comprises of experts from Archaeological Survey of India (ASI), the National Gallery of Modern Art along with I-T officials and others, sources said.