The Central Board of Direct Taxes (CBDT), in its action plan for the year 2014-15, has drawn up a time-bound and structured programme for disposal of appeals that are pending with the tax department. If targets set in the action plan are achieved, disputed tax demands running into more than Rs 4,000 crore will be cleared during this fiscal.

According to the target set in the plan, 95,560 cases constituting 44% of the appeals pending with commissioners of income-tax (appeals) are to be disposed of by March 2015. Appeals have been categorized into various baskets and the focus will be on disposal of almost all high-value cases (where the disputed demand is more than Rs 10 lakh). As 42,322 cases fall in this basket of 'high value appeals', on the most conservative basis the total amount involved in the disputes which could be settled during the year would exceed Rs 4,000 crore.

There are 8,684 cases of high-value appeals pending in Mumbai, followed by 5,070 in Delhi. If commissioners of income-tax (appeals) deal exclusively with transfer pricing cases, a separate target of clearing 150 cases per year has been suggested. When taxpayers dispute the tax demands raised on them, a structured appeal process has to be followed. The first level of appeals lies with the commissioner of income-tax (appeals).

Other highlights of the confidential action plan include taking stern prosecution action, in certain instances, against wilful tax evaders and better monitoring of suspicious overseas transactions and NGOs.

In a bid to crack down on tax evaders, stern action will be taken in those cases where penalty under section 271(1)(c ) exceeding Rs 50,000 has been levied by the tax department and confirmed by the tax tribunal. The CBDT's action plan in bold letters states: "All such cases must be processed for launching of prosecution at the earliest without waiting for any other proceeding." Penalty under section 271(1) (c ) is levied for concealment of income or furnishing inaccurate income details.

Cross-border transactions which seem suspicious will be closely monitored and tax authorities have been asked to obtain information from overseas jurisdictions, wherever deemed necessary. India has entered into 89 tax treaties and, in addition, has 16 tax information exchange agreements in place with non treaty countries. "These inquiries are useful not only to detect cases of tax evasion and avoidance but also to strengthen the evidence available with the tax officers," says the action plan. Receipt of gifts or debt in India or receipt of share capital or share application money by companies in India are some illustrations provided where information could be sought from officials in other countries.

Non-profits will also be on the CBDT's radar and the tax exempt status of most trusts and charitable organizations will be closely examined and data gathered will be centralized. Steps taken over the years for widening the tax base such as mandatory disclosure of PAN for certain transactions, e-filing of tax returns, furnishing of Annual Information Returns by third parties will continue. The action plan aims at strengthening such measures. Improving the quality of scrutiny (investigative) assessments is another target set out. This will ensure that tax officials are successful when matters reach courts.