G.R. No. 227121 - Commissioner of Internal Revenue vs. The Hongkong Shanghai Banking Corp. Limited-Philippine Branch

Prior to July 2008, The Hongkong and Shanghai Banking Corporation Limited (HSBC), through its Philippine branch (respondent), conducted a Merchant Acquiring Business (MAB) in the Asia-Pacific Region and entered into merchant agreements and deployed POS terminals.
July 22, 2008: Global Payments Asia Pacific-Phils., Inc. (GPAP-Phils) was incorporated. Respondent subscribed to 139,641 common shares in exchange for the fair-market value of POS terminals, merchant agreements, and the transfer of HSBC’s MAB in the Philippines.
July 24, 2008: Share Sale and Purchase Agreement executed between respondent (HSBC) and Global Payments Asia Pacific (Singapore Holdings) Pte Ltd. (GPAP-Singapore) for the transfer of the GPAP-Phils shares.
September 3, 2008: Deed of Assignment executed, assigning the 139,641 GPAP-Phils shares from respondent to GPAP-Singapore.
September 5, 2008: Documentary Stamp Tax of ₱52,365.75 paid based on par value of the shares.
September 22, 2008: Respondent filed an Application and Joint Certification with the CIR seeking a ruling on the tax-free exchange treatment under Section 40(C)(2) of the 1997 NIRC, as amended.
September 28, 2008: Capital Gains Tax of ₱89,929,292.10 paid in relation to the Deed of Assignment.

January 23, 2009: CIR’s Certification/Ruling No. SN:018-2009 issued, confirming the transfer of POS terminals and MAB for GPAP-Phils shares is tax-free under Section 40(C)(2).
September 8, 2010: Notice of Informal Conference issued by the CIR; received September 17, 2010.
January 7, 2011: Preliminary Assessment Notice (PAN) issued against respondent for alleged deficiency income tax of ₱296,936,948.59 (inclusive of interest); protest filed February 2, 2011 and supplemental position paper on March 10, 2011.
March 14 & 15, 2011: CIR referred the matter to its Legal and Inspection Group; respondent filed and CIR acknowledged a waiver of statute of limitations.
June 28, 2011: Final Assessment Notice (FAN) issued for deficiency corporate income tax of ₱318,781,625.17 on the alleged sale of “goodwill” under Section 27(A); protest filed July 26, 2011.
January 18, 2012: CIR issued Final Decision on Disputed Assessment (FDDA); respondent filed Petition for Review with the CTA Third Division on February 16, 2012.
October 13, 2014: CTA Third Division granted the petition and canceled the FDDA and FAN; December 10, 2014: motion for reconsideration denied.
May 17, 2016: CTA En Banc affirmed Third Division’s decision; September 9, 2016: motion for reconsideration denied.

Whether the CTA En Banc erred in canceling the CIR’s deficiency income tax assessment against respondent on the alleged sale of “goodwill” of its Merchant Acquiring Business for taxable year 2008.