2. Litigation costs shall be borne by the plaintiff.

A. As to the building of ○○○○○○○○○-gun, the Plaintiff owned, ○○○○○○-gun, 000-00 square meters and 8167 square meters (hereinafter the instant building) and above-ground hotel buildings (hereinafter the instant building), the auction procedure took place on the Plaintiff’s creditor’s voluntary auction application (○○○○○ Credit Depository, 0000 square meters). On June 27, 2001, Nonparty 2,085,000 won awarded a successful bid and completed the registration of ownership transfer on the said land and buildings. At the time of the auction, the ○○ Appraisal Board, an appraisal corporation, assessed the instant land as KRW 1,274,178,00 and KRW 3,222,917,80,00, respectively.

B. The Defendant: (a) deemed that the transfer of the instant building by auction falls under the supply of goods subject to value-added tax; (b) calculated the tax base for the instant building by the following methods pursuant to Article 48-2(4)1 of the Enforcement Decree of the Enforcement Decree of the Value-Added Tax Act; and (c) calculated the tax base for the instant building for the first period of August 1, 2001, imposed the Plaintiff the value-added tax of KRW 140,550,595 and additional tax of KRW 91,568,716 on August 1, 2004 (i) calculated the successful bid price for the instant land and building with knowledge of KRW 2,60,000,000 and imposed the value-added tax of KRW 289,453,330 as the value-added tax and the penalty tax on the instant building; (b) subsequently, the Defendant decided to re-determine the value-added tax by calculating

Tax base on the instant building = 1,405,505,957 won = Total successful bid price of KRW 2,085,00,000 (including value-added tax on the building) * Value of a building 3,322,917,800 (value of a building 3,322,917,800 + Land value of KRW 1,274,178,00 + Land value of KRW 1,274,178,000 + Land value of KRW 332,291,780 of the building value of KRW 10/100 of the building value)

[Reasons for Recognition] Class A: Evidence Nos. 1, 3, 4, 5, 6, 7, 8, 9, 10; Evidence Nos. 1 and 2; the purport of the whole pleadings

2. Whether the instant disposition is unlawful

A. The plaintiff's assertion

(1) The owner who loses ownership of the object of auction through the auction procedure like the Plaintiff is not likely to intervene in the bid price or the time of the auction during the auction procedure, and thus, cannot be deemed as the person liable for the payment of value-added tax because it is difficult to view that he is in a position to supply the object of auction. Moreover, since the court does not include value-added tax, it is unreasonable to deem the owner as the person liable for the payment of value-added tax in that there is no way for the owner to collect value-added tax

(2) Even if a proprietor is deemed a person liable to pay value-added tax, the owner cannot participate in the supply of goods, and in particular, the court, who is the main agent in the auction procedure, cannot file a preliminary and final return on value-added tax unless a tax invoice is issued, and thus, at least the penalty tax amount is unlawful

(b) Related statutes;

Value-Added Tax Act

Article 2 (Taxpayer)

(1) A person who independently supplies goods (referring to the goods provided for in Article 1; hereinafter the same shall apply) or services (referring to the services provided for in Article 1; hereinafter the same shall apply) on a business basis, regardless of whether it is for leisure purposes or not (hereinafter referred to as an “business operator”) shall be liable to pay value-added

Article 6 (Supply of Goods)

(1) The supply of goods shall be a delivery or transfer of goods pursuant to all contractual and legal grounds.

Where an entrepreneur supplies goods and services, the value-added tax, computed by applying the tax rate under Article 14 to the tax base under Article 13, shall be collected from the person who receives the relevant supply.

Article 22 (Additional Tax)

(5) Where an entrepreneur falls under any of the following subparagraphs, the amount prescribed in the relevant subparagraphs shall be added to the payable tax amount or deducted from the refundable tax amount

1. The amount equivalent to 10/100 of the payable amount not declared (the relevant insufficient amount paid) and of the refundable amount declared in excess, in case where the declared tax amount falls short of the payable amount to be declared, or of the refundable amount to be declared, under Article 18 (1) and (2) (proviso) or 19 (1); and

2. Where the tax amount not paid under Article 18 (4) or 19 (2) is short of the payable tax amount, or the refunded tax amount is in excess of the refundable tax amount, the total amount falling under each of the following items:

(a) Amount of unpaid tax (underpaid tax amount)* Period from the day following the payment deadline to the date of voluntary payment or payment notice * Interest rate as determined by the Presidential Decree in consideration of the interest rate applied by financial institutions to overdue loans; and

Enforcement Decree

Article 14 (Legal Order of Supply of Goods)

(1) The supply of goods under Article 6 (1) of the Act shall be as follows:

4. Delivery or transfer of goods by public auction, auction, expropriation, investment in kind, or other contractual or legal grounds;

Article 48-2 (Method of Calculating Tax Base)

(4) Where a business operator supplies land, buildings built on such land, and other structures (hereafter referred to as "buildings, etc." in this Article), the supply value of the buildings, etc. shall be based on the actual transaction price: Provided, That where distinction between the value of land and the value of buildings, etc. is unclear from among the actual transaction price

1. Where there are all the standard market prices under Article 99 of the Income Tax Act on land, buildings, etc. (hereafter in this Article, referred to as “standard market prices”), it shall be calculated in proportion to the values calculated according to the standard market prices as of the date of supply contract: Provided, That where there exists an appraised value (referring to the value assessed by an appraisal corporation under the Public Notice of Values and Appraisal of Lands,

Article 58 (Delivery of Tax Invoice in Case of Entrusted Sales, etc.)

(6) Where goods are supplied due to public auction, auction or expropriation, an institution conducting a public auction or auction by applying mutatis mutandis the provisions of paragraph (1) or the relevant project operator may issue a tax invoice.

C. Determination

(1) Determination as to the plaintiff's assertion that he is not a taxpayer under the Value-Added Tax Act

On the other hand, Article 2 (1) of the Value-Added Tax Act provides that the person who supplies goods and services independently for business is the person liable for value-added tax, and Article 14 of the Enforcement Decree provides that the transfer of goods by auction is included in the supply of goods, so the owner of the object of auction shall be the person liable for tax payment under the Value-Added Tax Act. In this case, the existence of liability for value-added tax shall not be determined based on whether the person who receives the supply actually collects the amount of value-added tax from the person who receives the supply, or on the existence of liability for failure to collect the amount of value-added tax and the possibility of collection, etc. Therefore, in real estate auction, the court, which is the auction institution, did not collect value-added tax from the successful bidder, and thus, the owner is not the person liable for value-added tax (Supreme Court Decision 2003Da49

In light of the above legal principles, in this case, the value-added tax is imposed on the Plaintiff who is the owner of the building even if the court, as the auction institution, did not impose value-added tax on the total successful bidder, and did not issue a tax invoice because it did not collect value-added tax from the successful bidder. As such, if the tax base of the building in this case is deemed that the total successful bid price does not include value-added tax on the building in the total successful bid price, the tax base for the building in this case is more unfavorable than that of the taxpayer (as seen earlier, the tax base for the building in this case is 1,501,50,200 won (the total successful bid price of KRW 2,085,000). 3,322,917,800/800 (the building price of KRW 3,322,917,917,800 + the land price of KRW 1,274,178,000).

Ultimately, since the owner of an object of auction, regardless of whether the value-added tax on the total successful bid price includes the value-added tax on the building, the disposition of this case by the defendant who calculated the tax base on the building and imposed the value-added tax is legitimate, and the plaintiff's assertion that the plaintiff is not a taxpayer under the Value-Added Tax Act cannot be accepted.

(2) Determination as to the assertion that the penalty tax was unlawful in the instant disposition

On the other hand, Article 58(6) of the Value-Added Tax Act provides that even if the court in charge of the auction procedure does not issue a tax invoice, and there is any aspect that the return and payment of the tax base and tax amount arising from the successful bid as the owner of the object of auction is not easy, the auction institution may also issue the tax invoice. Since there is no prohibition from issuing the tax invoice by the owner of the object of auction, it is not impossible for the owner of the object of auction to issue the tax invoice on the ground that the object of auction is supplied through auction, and furthermore, even if there is no tax invoice for the portion of sales, it is possible for the court to issue the tax invoice, in light of the fact that the return and payment of the value-added tax can be made even if there is no tax invoice for the portion of sales

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.