The right-wing Bharatiya Janata Party, which took power in May, earlier accused the previous Congress government of failing to get tough on the issue that has become a political lightning rod.
The government filed an affidavit in the Supreme Court on Monday naming seven business people, men and women, including Pradip Burman — a former director of the well-known Dabur food group — for allegedly hiding money abroad, along with a Goa mining company, Timblo Private Ltd.
The governing party has been under pressure to identify offenders following petitions from activists including prominent lawyer Subramanian Swamy, who has waged an aggressive campaign to prosecute wealthy people with undeclared funds offshore.
The government said in its affidavit it was "committed to disclose the names of persons holding illegal money . . . following due process of law".
BJP spokesman Sambit Patra called disclosure of the names an "historic day".
"Names are gradually being declared," Patra told reporters.
"Today is the beginning of the end for those who illegally stashed money abroad."
But opposition Congress general secretary Digvijaya Singh accused the BJP of "selective revelation" of names and said the drip-feed process smacked of "blackmail, not black money".
Finance Minister Arun Jaitley last week said Congress could face "some embarrassment" when names of people holding illicit foreign accounts was made public.
Lawyer Swamy said he did not understand why the government had not disclosed the identities of all alleged offenders.
"I do not see any legal issues in releasing all 700 names," he told CNN-IBN television network.
'Black money' scandal
Indian rumour mills have been in overdrive about who may be on the government's so-called "black money list".
In 2011 French authorities informed India of around 700 Indians with Swiss accounts.
The information came from a data leak by a Swiss bank employee.
Other funds are believed to be stashed in tax havens such as Lichtenstein.
The Indian government said on Monday that Swiss authorities had agreed to "provide information" to help India investigate leaked accounts after earlier saying such assistance would break Swiss law.
The political importance attached to the issue was underscored when, a day after taking office, Prime Minister Narendra Modi set up a team of regulators and ex-judges to identify illicit fund-holders and repatriate money.
The BJP while campaigning had vowed to "bring back black money within 100 days" of being elected.
But it has found obtaining details about account-holders from foreign nations difficult due to financial confidentiality issues.
The latest names had been revealed because "prosecution has been launched under the income tax law", the government said.
Global Financial Integrity, a Washington-based group that tracks money transfers, said Indians surreptitiously shifted $344 billion overseas between 2002 and 2011, depriving India of vital tax revenues.
But that money abroad is a fraction of illicit funds and assets concealed in India, experts say.
The Dabur group said in a statement that Burman opened his "legally allowed" foreign account while he was a non-resident Indian.
Another person named in Monday's affidavit, Pankaj Chimanlal Lodhiya, chairman of western Indian jewellery-and-real estate firm Shreeji Trading, told reporters he had complied with tax laws and had no foreign account.
One other person named, Goan mine operator Radha Timbola, said, "We want to see the affidavit" before commenting.
Timbola and four other company directors belonging to the family owning the mining firm were named in the ten-page affidavit.
Other names under investigation were disclosed by the previous scandal-racked Congress government, but activists charge that authorities are "cherry-picking" names and "big fish" are being protected.
Prashant Bhushan, another prominent legal activist, said he was "disappointed at the (disclosure of) relatively innocuous names rather than the more influential and powerful names".