New Delhi: The government on Friday extended the tax dispute resolution scheme by one month to January 31, 2017.


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The scheme was due to close on December 31.


After the scheme closes, the Income Tax Department will go ahead with tax demand and pursue legal course, including arbitration, sources said.


The government had asked the I-T Department not to take any coercive action during the time the scheme is open.


The government, in the Budget 2016-17, had announced a scheme to settle the retrospective tax disputes by waiving interest and penalty if the companies paid up the principal tax amount.


The Direct Tax Dispute Resolution Scheme, introduced on June 1, seeks to address the issue of pending litigation before the CIT (Appeals).


According to the  I-T department data, there were 73,402 appeals with tax effect above Rs 10 lakh and 1,85,858 appeals with tax effect below Rs 10 lakh which are pending before CIT (Appeals) as on February 29.


Thus, 2,59,260 appellants are eligible for the benefit of this scheme.