In a statement issued here, the chamber has said it is inevitable that the falsification of accounts should be taken out from the ambit of the Prevention of Money Laundering Bill 1998 and should be dealt with under another act like the Indian Penal Code, Companies Act, Income Tax Act and Chartered Accountants Act.

In a paper prepared on the implications of various provisions of the bill, Ficci stated that it may not be proper to put falsification of accounts in the same category as offences like murder and drug-peddling. It is generally difficult to find out whether there is any falsification of accounts and if so who is liable for the falsification. This will impose onerous responsibility on the auditors who sign the final balance sheet and any manipulation detected could invite action against them.

Ficci has also statedthat clause 11 of the bill, which requires financial institutions and intermediaries to furnish information to the commissioner of income tax about the transactions in the month exceeding Rs 25 lakh, will unnecessarily add to the cost and also give a big setback to the already sluggish capital market. The chamber has suggested that the ED should instead call for such information from the institutions and intermediaries.

The chamber added that the limit of Rs 25 lakh should be enhanced to Rs 3 crore and financial institutions and intermediaries not accepting public deposits should be exempt from the ambit of the clause.