Megaupload founder Kim Dotcom told the New Zealand High Court on Tuesday that the illegal raid conducted by a joint team of local police officials and the U.S. Federal Bureau of Investigation left his multi-million mansion and his life in disarray.

The former Kim Schmitz testified before NZ prosecutor John Pike that he was a victim of what can be called as forceful entry in a private home under the guise of search warrants that an Auckland court had declared as defective late in June.

"Almost everything you've done was unlawful," the combative Mr Dotcom was reported by Bloomberg as saying while directly addressing the crown prosecutor.

His testimony today, media reports said, was part of the three-day trial in which the flamboyant former hacker would attempt to convince NZ High Court justice Helen Winkellmann to give him back electronic files and documents that he claimed were illegally seized by authorities who swooped down on his residence on January 20.

According to Mr Dotcom, his personal files would serve crucial roles in his defence against charges of copyright infringement, racketeering and money laundering he was accused, along with three Megaupload colleagues, by U.S. authorities.

U.S. officials have earlier indicated that Mr Dotcom has employed his Megaupload file-sharing global business to facilitate the illegal distribution of music, movies and softwares that led to American producers bleeding as much as $US400 million.

Mr Dotcom himself became a multi-millionaire, with Bloomberg placing his current value at around $US175 million.

Without conceding that he had done anything illegal, Mr Dotcom insinuated that he was a victim of brutality on the part of authorities, who he told the court "turned ... our beautiful house ... into a haunted house."

His life onwards became haunted following the raid of the swanky residence he was renting near the outskirts of Auckland.

"Life is not the same after what happened," The Associated Press quoted Mr Dotcom as saying on Tuesday.

What transpired were unnecessary, he added, providing details that pointed to police officials forcing their way into his house causing undue destruction to the place.

Mr Dotcom recalled that he heard the sound of a helicopter, which did not alarm him, though when it was followed by large banging on his private room, he was prompted to hide in what he described as "safe or red room."

The raiders successfully opened his hiding place and Mr Dotcom said that immediately he raised his arms to surrender but someone punched him in the face and another kicked him while lying face first on the floor.

His hands were tied behind his back while 'an officer' prevented him from getting up by weighing him down with a foot, Mr Dotcom said.

Should the court favours Mr Dotcom's testimonies, he would be allowed access to files and documents that authorities confiscated in the aftermath of the January raid, which also saw the seizure of his luxurious fleet of cars and freezing of his assets.

Mr Dotcom said he intends to base his defence on the files the moment hearings for his extradition to the United States resumes, which the NZ High Court has set for March 2013.