Ecoenergy Insights Ltd. Vs DCIT (ITAT Delhi)
ITAT Delhi Strikes Down Entire TP Additions: Projections Cannot Be Replaced With Actuals; ALP of Support Services Cannot Be Fixed at NIL; Valuation Not an Exact Science: Independent Valuer’s Report Cannot Be Rewritten by TPO Using Actual Results- ITAT Deletes ₹68 Cr TP Adjustments in Ecoenergy Insights Case
Delhi Tribunal adjudicated multiple transfer pricing adjustments made in the case of Ecoenergy Insights Ltd. (formerly Chubb Alba Control Systems Pvt. Ltd.) for AY 2018-19 under section 147 r.w.s. 144C/144B. Assessee challenged several TP additions—relating to transfer of specified assets, availing of support services, purchase of traded goods, & receipt of R&D fees—& also raised technical objections regarding limitation & validity of reference to TPO.
On the preliminary jurisdictional issue, Tribunal followed its earlier decision in UCWeb Mobile Pvt. Ltd. (2025), holding that references made by AO–Technical Unit to TPO under the faceless regime are valid & consistent with section 144B; hence the assessment was not time-barred & the objection was rejected.
On merits, Tribunal first examined the addition for transfer of specified assets (Rs.39 crore). It observed that TPO had substituted the valuation projections with actual post-transaction financial results & further questioned the risk-premium components adopted by an independent valuer. Relying on the Delhi High Court’s judgment in PCIT v. Cinestaan Entertainment Pvt. Ltd., Tribunal held that valuation is inherently projection-based & cannot be revisited using hindsight or compared mechanically with future actuals. Since Assessee had acquired the business earlier at the same valuation & had supported the transfer with an expert report & audited disclosures, TPO’s approach of recomputing ALP by replacing projections with actuals was contrary to settled law. Accordingly, Tribunal struck down the entire adjustment.
