For all those businesses enlisted, as governed under sec.44 AD , after deducting for depreications of machinery, vehicles used , one cannot get more than 5% to 7% .; as far as legitimacy of keeping amount in bank to get interest @ 9% ( doubtful) with TDS and It appalicable on it , makes it effective 5 % or 6% at most .
so govt is / was wise to make sec 44 AD appalicable with self decalration of profit of 8% ...simply to amke them comfortable ..of not keeping books of accounts and its records for 8 years, and faciltate them , to simply concentarte them on labor oreined there business,
as far as ilegitimate use of that sec.44AD ..In India , there are several people , who operate byaaj-batta ..money lending ( even there are educated professionals in it) and hardly pay anything to govt.as taxes or scuffle with 44 AD to avoid it