New Delhi, March 4 :     The parliamentary standing committee on finance has suggested the dilution of the provisions of the prevention of money laundering bill by deleting offences such as falsification of accounts and crimes related to prostitution and corruption from the ambit of the legislation. In its report submitted to Parliament today, the committee suggested that only offences relating to drug trafficking, terrorist activities and ?some serious provisions contained in the Indian Penal Code and the Arms Act which are of a serious nature and pose a threat not only to the stability of the financial system but also sovereignty and integrity of the country should be retained.? Industry and trade chambers have long been lobbying for these very changes and should be pleased with the report. The bill had been referred to the committee headed by Congress MP Murli Deora after finance minister Yashwant Sinha introduced it in Parliament last year. Although its recommendations are not mandatory, these are normally accepted by the government and the bill is accordingly amended. In some areas, the report has gone beyond what the chambers had demanded. While the chambers wanted the limit for reporting bank transactions to income tax authorities raised from Rs 25 lakh to Rs 1 crore, the report says only cash deposits or withdrawals above Rs 25 lakh need to be reported. Transactions involving such huge sums are normally through cheques or bank transfers and these would not be covered by the bill if the report is accepted by the government. ?The standing committee?s recommendations are not mandatory,? say revenue department officials. ?Normally, the government accepts these to be the considered wisdom of the house which it represents and acts accordingly.? The report also wants the government to amend the bill to place the onus of proving criminal intent or ?culpable mental state? on the government instead of asking the offender to prove that he had no criminal intent. At the same time, it seeks to introduce the word ?knowingly? into the definition of money laundering, thus providing an escape route to offenders who can then plead that they laundered money without realising that it was illegally earned. The committee also states in case a transaction relates to money laundering, inter-connected transactions should not be considered to be attempts at money laundering unless ?otherwise proved to the satisfaction of the authority concerned?. The powers conferred on IT officials to survey, search, seize and arrest have also been diluted making it mandatory for them to act in accordance with the Criminal Procedure Code. Similarly, suspects will be allowed to enjoy property which has been provisionally attached by IT authorities. The committee has also enhanced the fine and prison terms for officials who search or arrest ?without reasonable grounds of suspicion? from three months imprisonment and or a fine of Rs 10,000 to two years imprisonment and or a fine of Rs 50,000. Officials said, ?This is sure to make any IT officer think many times before acting on tip-offs and will certainly reduce the effectiveness of the service.? The fine and imprisonment for giving false information has also been raised. The MLB had left an escape clause for officials acting under the bill by stating that no legal proceedings can be launched against them in discharging their duties. This has also been taken away by the report which has suggested that legal action should not be taken up only if the officials had acted in ?good faith?. The report has also sought to enhance the qualifications for chairpersons of appellate tribunals. Only serving or retired judges of the Supreme Court can be appointed chairpersons. The original bill allows even high court judges to be appointed.