A deeply divided House approved its latest version of terrorist surveillance legislation today, rebuffing President Bush's demand for a bill that would grant telecommunications firms retroactive immunity for cooperation in past warrantless wiretapping and deepening the impasse on a fundamental national security issue.

Congress then defiantly left Washington for a two-week spring break.

The legislation, approved 213-197, would update the 1978 Foreign Intelligence Surveillance Act to expand the powers of intelligence agencies and keep pace with ever-changing communications technologies.

But it challenges the Bush administration on a number of fronts, by restoring the power of the federal courts to approve wiretapping warrants, authorizing federal inspectors general to investigate the administration's warrantless surveillance efforts, and establishing a bipartisan commission to examine the activities of intelligence agencies in the wake of the Sept. 11, 2001, attacks.

Most provocatively, the House legislation offers no legal protections to the telecom companies that participated in warrantless wiretapping and now face about 40 lawsuits alleging they had breached customers' privacy rights.