The bill, piloted by Finance Minister P Chidambaram,sought to include activities like cheating, concealment, acquisition and use of proceeds of crime as criminal activities for the purpose of Money Laundering.
Replying to discussion on the Prevention of Money Laundering (Amendment) Bill, 2011, Chidambaram said the changes in law would give signal to the international community about India's commitment to deal with the offences having wide international ramifications.
The bill was later approved by voice vote.
The amendments, Chidambaram explained, sought to enlarge the definition of predicate offences of money laundering and include activities which are defined as crime under various other laws.
The list of offences would include concealment, acquisition, possession and use of proceeds of crime as criminal activities. It also seeks to remove existing limit of Rs 5 lakh as fine under the Act.
Responding to queries on black money, Chidambaram said, "We are taking action...every single piece of information (received from France and other countries) is being investigated" and more action would be taken.
As regards the Money Laundering Law, he said, 37 cases of prosecution have been launched but no one has been either convicted or acquitted.
The amendment bill was introduced in the Lok Sabha in December, 2011 by then Finance Minister Pranab Mukherjee and referred to the Parliamentary Standing Committee on Finance.
Chidambaram said the government had accepted all the 18 recommendations made by the panel and termed it as an indicator of consensus between government and the opposition on the issue.
The amendments, the Minister said, would also help the Centre bring the anti-money laundering legislation on par with international standards and obviate some of the deficiencies in the present Act that have been experienced by the implementing agencies.
"Parliament has improved upon the law in 2005, after bringing it in 2002, and then again in 2009 and once again in 2012," Chidambaram said.
The proposed amendments also seek to introduce the concept of 'corresponding law' to link the provisions of Indian law with the laws of foreign countries.
Replying to issues raised by members, Chidambaram said blackmoney was a different issue while the money laundering law deals with the proceeds of crime which are defined in the statute. "We need to have a separate discussion on blackmoney," Chidambaram said.
The Minister also said that government was initiating steps to fill vacancies in the Enforcement Directorate to strengthen it to deal with the menace of blackmoney.
The government plans to induct 1,319 additional officers in the Enforcement Directorate to increase the strength to 2,064.
The treasury benches voted out the provisions in the Amendment Bill regarding appointment of sitting or retired judges of Supreme Court or Chief Justice of High Court as Chairman of the Appellate Tribunal to be set up under the Money Laundering law.
The government is finding it difficult to procure services of senior judges, Chidambaram said explaining the reasons behind voting out the clause which was proposed in the Amendment Bill.
He said the appeal against the decision of the Tribunal would be entertained by the High Court and not directly by the Supreme Court.
The Minister explained that offences under the Customs Act would also be covered by the Money Laundering law.
He said this in response to a question whether over-invoicing or under-invoicing would be a punishable offence under the Money Laundering Act.
The Bill also provides for attachment and confiscation of the proceeds of crime even if there is no conviction so long as it is proved that offence of money laundering has taken place and property in question is involved in money-laundering.
Earlier, initiating the debate, Nishikant Dubey (BJP) sought to attack the Congress and the government on the issue of blackmoney stashed away in Swiss bank accounts.
He claimed that despite the name of a sitting MP from the treasury benches in the list of Indians allegedly having Swiss bank accounts coming out, the government has not made a statement and asked Chidambaram to clarify.
Sanjay Nirupam (Cong) sought to turn the tables on the BJP by demanding that corruption be added in the bill.
In an oblique reference to a top BJP leader, he said a minister may favour a contractor using his position and later himself open a company which may get funds from the same contractor as a return favour.
Those who participated in the discussion included B Mahtab (BJD), Saugata Roy (TMC), Saidul Haque (CPI-M), M Thambidurai (AIADMK) and Raghuva.