Finance Minister Nirmala Sitharaman on Monday met industry representatives on the proposed direct tax dispute resolution scheme that provides an opportunity for taxpayers to pay outstanding taxes and get waiver of interest and penalty.

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With over Rs 9 lakh crore worth direct taxes locked up in litigation, the government last week introduced 'Direct Tax Vivad Se Vishwas Bill, 2020' in the Lok Sabha.

Once passed by Parliament, the scheme would be notified and rules would be framed.

"During the meeting, industry associations gave their suggestions for the scheme," a source said.

Separately, PHD Chamber of Commerce President D K Aggarwal in a statement said that the last date for the scheme should be extended by a month till April 30, 2020.

The scheme "will benefit many taxpayers and can generate more than Rs 2 lakh crore for the government in the coming times if it is broadened and exclusions are minimum under this scheme," he said.

Under the proposed scheme, taxpayers willing to settle disputes shall be allowed a complete waiver of interest and penalty if they pay the entire amount of tax in dispute up to March 31, 2020, after which 10 percent additional disputed tax shall have to be paid over and above the tax liability.

Further, where the tax arrears relate to disputed interest or penalty only, then 25 percent of disputed penalty/interest shall have to be paid only if the payment is made by March 31, 2020, beyond which the same shall be enhanced to 30 percent.

The scheme would remain open till June 30, 2020. The scheme cannot be availed in case where prosecution has been instituted or where tax arrears relate to undisclosed foreign income or assets.

About 5 lakh cases are pending at various levels with disputed tax arrears amounting to Rs 9.32 lakh crore as on November 30, 2019