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2020 (6) TMI 242 - AT - Income TaxUnexplained investments - assessee had declared income u/s 44AD - HELD THAT:- On a careful perusal of the cash flow statement prepared by the Assessing Officer, except for investments in Multi Commodity Exchange, Cochin Stock Exchange and Household expenses respectively all other amounts considered as application, is directly or indirectly linked to the business of running houseboats. Therefore, the inclusion of the business transaction as unexplained investments / expenditure would go against the provisions of section 44AD - AO has also not considered the opening cash and bank balances as on 01.04.2010 and only the profits declared is considered as inflow in the cash flow prepared by him. The cash flow statement prepared by the A.O. is based on assumption and the same needs to be rejected. Assessing Officer is not considered opening of cash balance as on 01.04.2010 and only the profits declared is considered as inflow in the cash flow prepared. Moreover, most of the applications of income is directly linked to the business of the assessee declared u/s 44AD - Thus no addition is warranted. - Decided in favour of assessee.
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