A large amount of loo paper (sometimes a towel) is held directly underneath the bottom of the seated individual currently on the loo. Thus, the excess paper is designed to absorb most of the sound given off from the motion and changes the pitch of the tone to a more subdued base note.
Normally performed in public toilets where the walls separating the individual bowls are marginal; but also when a colleague/family member is know to be in close proximity.
Josh entered the public loo's and knew straight away that today he'd be exercising the muted-flute as the partition between the individual lavatories was minimal.
Tom was going for a big crap - the muted flute was the obvious choice.