2. On July 29, 2014, the Defendant’s imposition of value-added tax of KRW 000,000,010 for the first period of 201 against the Plaintiff on July 29, 201, and the imposition of value-added tax of KRW 00,00,300 for the second period of 201 shall be revoked, respectively.

3. On July 29, 2014, the Defendant’s notice of change in the amount of income as KRW 0,000,000,833 is revoked, where the Plaintiff sent the income earner to the Plaintiff on July 29, 2014, and the amount of income attributed to year 2011.

4. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order of the Gu office.

A. The Plaintiff was established on October 00, 190 and operated the manufacturing business of fireproof products, etc., and around April 2009, the Plaintiff first commenced Aluminium business upon completion of the factory** at the time of completion of the factory.

B. Daejeon Director of the Regional Tax Office (hereinafter referred to as the "Investigation Office") made an integrated tax investigation with respect to the plaintiff from November 12, 2013 to January 20, 2014: 00 won for the year 2000 won; 0,000 won for the actual inventory amount verified by the plaintiff's business division as the actual inventory inspection; 0,000,000 won for the year 200, 2000, 2000, 2000, 2000, 2000, 200, 2000, 100, 200, 100, 100, 200, 100, 100, 200, 100, 100, 200, 200, 100, 200, 200, 200, 200, 200, 2004, 200.

D. On August 7, 2014, the Plaintiff received the Defendant’s notice of each taxation disposition, and filed an appeal against each of the Defendant’s respective taxation dispositions on September 4, 2014, and on June 11, 2015, the Tax Tribunal rendered a decision of admitting part of the purchase tax invoice (the Plaintiff received from the new international metal, 00,029,500 won, and the value of supply of each purchase tax invoice received from the person and nature of the corporation as of June 4, 2010, and 00,000,000 won, including the total value of supply of each purchase tax invoice received from the person and nature of the corporation as of February 10, 2012 and February 18, 2012, and corrected the corporate tax base, tax amount, and the amount of notice of changes in income amount, and dismissed the remainder of the appeal).

E. Accordingly, on July 15, 2015, the Defendant revised the initial determined amount of corporate tax in 2011 to KRW 0,000,051, and the amount of corporate tax in 2012 to KRW 0,000,393 was also reduced to KRW 000,000,410 for the business year 201, and the amount of corporate tax in special rural development tax was reduced to KRW 000,000 for the business year 201, KRW 632 for the special rural development tax, and corporate tax in 2012 to KRW 00,000,843 for the corporate tax in 2012.

[Ground for recognition] Unsatisfy, Gap evidence 1 to 7 (if there is a serial number, including a branch number; hereinafter the same shall apply)

2. Whether the instant disposition is lawful

A. Grounds for the disposition of this case asserted by the defendant

The Plaintiff’s total sales profit or operating profit in 2011 has significantly decreased compared to the other business years under the income statement of the Plaintiff’s Aluminium business division. The amount of raw material cost per year 201 increased compared to the other business years. As a result of calculating the estimated amount of raw material input in the production quantity based on the mixed ratio sample submitted by the Plaintiff, and calculating the amount of raw material input cost in the pertinent business year (hereinafter referred to as “estimated amount of material cost”) by multiplying the average purchase price by the pertinent business year, it is difficult to view that there was an additional raw material input in 2009 and 2010, as the amount of raw material cost calculated at the time of the Plaintiff’s corporate tax return for the pertinent business year was not significantly different from the raw material cost calculated at the time of the pertinent business year in 209 and 2010. On the other hand, the issue inventory in 2011 was already reflected in the production process in 209 and 2010, the disposition of this case is justified by omitting the sales (this case’s calculation).

B. The plaintiff's assertion

The facts requiring taxation are proved by the tax authority, and there is a stock difference merely, and it cannot be recognized as omitting sales without any specific grounds. Since there is no proof that the sales amount equivalent to the difference in the issues in the business year 2011 caused to the Plaintiff, and the Defendant did not secure the evidence of outflow from the company, it is inappropriate to impose taxation by the Defendant by recognizing the Plaintiff's issues inventory as an omission of sales and determining the amount of outflow from the company. Furthermore, since the sampling ratio used by the Defendant to calculate the estimated amount of input material cost is not only a part of the composite ratio applied by the Plaintiff in the year 2012, but also a substantial difference between the actual input cost and the actual input cost

C. Determination

1) In the administrative litigation seeking the revocation of the tax disposition on the ground of the illegality of the Plaintiff’s taxation disposition, in principle, the tax authority bears the burden of proof as to the legality of the disposition and the existence of the taxation requirements. Whether there was any profit to be included in the gross income in determining the amount of a corporation’s income or the amount of such profit, in principle, the tax authority bears the burden of proof as to whether there was a profit to be included in the gross income in determining the amount of the corporation’s income. Generally, in revising the reported amount of a taxpayer’s tax liability due to an error or omission, the burden of proof is based on account of account books or evidence (see, e.g., Supreme Court Decision 2001Du7770, Jun. 24, 2003). In light of the fact that there was a difference between the calculated amount of inventory on the account book and the actual amount of inventory (see, e.g., Supreme Court Decision 2001Du770, Jun. 24, 2003).

On the other hand, Article 16 of the Framework Act on National Taxes provides that the tax authorities shall apply to the books kept and recorded by the taxpayer in the course of investigating and determining national taxes and documentary evidence related thereto, and that when the tax authorities investigate and determine any fact different from the details of the taxpayer's entry or omission in the entry, the investigation and the grounds for its determination shall be stated in the written determination. If the tax authorities conducted the on-site investigation of inventory assets based on the end of the specific business year, it is reasonable to prove that the shortage in the amount of inventory assets was made in the relevant business year or the previous business year, if the shortage in the amount of inventory assets was discovered as a result of the on-site investigation of inventory assets, such shortage in the amount of inventory assets is not made in the relevant business year or the previous business year. On the other hand, the omission in sales included in the amount of the corporation's income refers to the failure of the taxpayer to include the difference in the amount of inventory assets in the books even after the actual sales was made out of the company, the tax authorities shall examine and verify them together

B) Based on the above legal principles, in light of the following circumstances, the Defendant’s proof, which is the tax authority, as to whether the instant case’s inventory occurred due to the omission of the Plaintiff’s sales, is nonexistent or insufficient, in light of the following circumstances, which can be acknowledged by comprehensively taking account of the following circumstances: (a) evidence Nos. 9, 10, 11, 12, 13, 14, 20, and 5 through 8; and (b) evidence Nos. 5 through 8; and (c) evidence Nos. 5 through 5

(1) In April 2009, the Plaintiff first started the business related to Aluminium in order to expand the business territory to the production sector of Aluminium products. Since the commencement of the factory operation, the Plaintiff conducted an inventory inspection at intervals of one month, not later than the overall inventory inspection on March 201, by measuring and measuring the approximate weight with the land at intervals of one month. The Plaintiff Company * in the Plaintiff Company * stored most of the materials stored in the site of Aluminium 2009 in the form of storing them in the open space in the form of bulk.

(2) The main raw materials used in the production of Aluminum products are mainly the materials of Aluminum scrap metal, such as showers, chips, cans, interior tegres, tegres, and chips. The materials do not match the form or quality due to the characteristics of the kinds of scrap metal, but contain foreign materials such as oil, hydrogen, soil, plastics, etc. In particular, in the case of chips like the kinds of chips, there are considerable amounts of loss between the time when they were put into the factory and the time when they were put into the production of Aluminum due to the decrease in water portion. In order to improve the accuracy of inventory management due to the characteristics of the raw materials, the materials are put in the storage stage of the materials through the examination conducted in accordance with certain inspection standards, such as inferior raw materials or chips that contain a large quantity of quantity.

Although it is necessary to properly reduce the quantity of materials that have no choice but to cause a reduction, in the case of the materials, the plaintiff company** factory does not have systematic standards for inspection and reduction of the price in the case of the plaintiff company*, so the field officer, the production division, has conducted the inspection or reduction of the defective goods at will.

(3) As such, due to the characteristics of raw materials that involve a heavy loss, the Plaintiff frequently demanded large quantities of foreign substances, etc. due to the heavy and material content between the Plaintiff and the customer that supplies the raw materials, and there are frequent instances where the Plaintiff confirms that a large quantity of foreign substances, etc. were contained in the raw materials, and takes procedures to reduce the purchase price and the purchase weight at the relevant purchasing agency.

(4) The Plaintiff, on a intermittent basis, handled the difference between the inventory and the actual inventory on the account books due to the foregoing foreign materials, including water, etc., by the method that reflects the inventory shortage in the production of the account books or cost.

(5) At the end of 2010, the management support team and the management support team in charge of the Plaintiff’s profit and loss management were found to have a significant difference between the stock and the actual stock as a result of the joint survey on the draft oil inventory conducted by the joint management support team and the management support team in Aluminium. Accordingly, the management support team of Aluminium and the management support team of Aluminium found that there was a cumulative difference between the stock and the actual stock on the account book whenever the actual stock survey was conducted on several occasions from March 201 to November 201 and the actual stock survey was conducted on several occasions. The key stock difference between the inventory and the actual stock survey on the account book was found to have been accumulated in the amount of KRW 0,000,00 g (0,000,000 won).

(6) The Plaintiff conducted an analysis of the cause of shortage in inventory due to subsequent measures following the inventory inspection. Although the Plaintiff actually puts raw materials into the production site, it was pointed out that “the lack of stock records was omitted, and the difference between the total weight at the time of storage and delivery” was caused by shortage in inventory. The Plaintiff’s management developed inventory methods for any of the causes in a certain process and ordered the Plaintiff to prevent recurrence of the same situation after ascertaining the more accurate cause. Accordingly, the Plaintiff’s management at the time ****** the production division of the factory * * on May 20, 201, the reason for shortage in inventory was as follows. (7) The difference between the inventory and the actual inventory of the Plaintiff Company ***** as a result of the actual inventory inspection, it was difficult to arbitrarily prepare an internal report or to raise a big difference between the total quantity of raw materials stored at the production site and the inventory inspection at the time of the material storage, despite the absence of accurate inspection work at the time of the material storage and the inventory inspection.

(8) Ultimately, the Plaintiff shall be held liable for insufficientness in the inventory management *** the head of the factory production division ** (the retirement from August 31, 201). The head of the factory** (the retirement from August 27, 2012) and the Deputy Administrator of the Management Division* (the retirement from December 31, 201) respectively.

(9) Since then, the Plaintiff sought measures to improve the shortage in stock, and sought specific measures as follows.

(10) 나아가 원고는 원재료 등이 알루미늄 사업부 야적장에 벌크 상태로 야적되어 재고관리가 제대로 이루어지지 못한 점을 개선하기 위하여 2011. 12.경부터 원재료 보관장 레이아웃(칸막이)을 설치하고 팻말 부착 및 번호 부여를 통해 각 레이아웃에 보관되어 있던 일정량의 원재료가 소진되는 즉시 장부상 재고와 실물 재고를 비교하여 재고차이를 조정하는 기준을 정립하였다. 이에 따라 육안상으로도 각 레이아웃에 보관된 원재료를 수월하게 식별할 수 있게 되었고, 원재료 검사기준을 통해 매일 입고되는 원재료에 대한 이물질 함량 여부를 확인하여 정확한 감가감량을 수행하고 불량 정도에 따라 입고, 클레임 또는 반품여부를 판정하여 보고하는 절차를 확립하게 되었다.

(11) In the case where the Plaintiff’s sales of raw materials by an Aluminium business division without using them in the product manufacturing itself is not very good to the extent that it is mainly impossible to process or return them (e.g., the evidence No. 9-2 is a draft for the sale of raw materials by an Aluminium business division. According to the content, the Plaintiff’s sales of raw materials by the TAIN-TBOR, which was put from SM trading, is intended to sell because it was not used as raw materials due to environmental complaints, exhaustions, reduction in recovery rate, etc., as it includes rubber between the market). Ultimately, the Plaintiff’s sales of raw materials itself was conducted in special cases, such as where it is not recognized as raw materials, and even in such cases, it appears that the Plaintiff prepared relevant documentary evidence, such as the sales goods, and sold them.

(12) Meanwhile, the Defendant conducted a tax investigation on the Plaintiff over about 70 days from the end of 2013 to the beginning of 2014, and during that period, examined the Plaintiff’s security log, work log, the purchase amount and the payment evidence from the raw materials purchasing office of Aluminium business, and the sales amount and the sales collection evidence of the goods of Aluminium business unit, etc. The Plaintiff’s headquarters and Aluminium business division are located ** (where the Plaintiff’s headquarters and Aluminium business division are located) by directly visiting the factory, and directly sending a written confirmation to the raw materials purchasing office to investigate whether the goods were processed or not, the Defendant did not find any specific data such as the fact of processing purchase, the fact that the materials were removed from the raw materials without entry in the books, and the details of transactions that could identify suspicion of non-material transactions, etc.

(13) In particular, in light of the fact that the stock difference alleged that the Defendant was out of the factory is a stock equivalent to 0,00 tons of raw materials accumulated in the open space. In order to take it out, about 54-5 tons of primary truck may be removed from the company. At the time of the Plaintiff company ** in the factory, there were two or more managers working in daytime, night, and weekends to monitor light light in the factory, and 7-8 CCTVs were operated, it is almost impossible to arbitrarily remove the raw materials from the open space. In addition, in this case where the Defendant, who is the tax authority, taxation disposition on the grounds that separate sales of the materials have occurred in the year 2011, were omitted, it is difficult to see that the Plaintiff’s inventory had been carried out at will during the 15th month period from March 201 to November 21, and that there was no more than 15th month from March 201.

2) Whether the calculation of the estimated amount of input raw materials cost presented by the Defendant is reasonable

A) The Defendant asserts that the estimated amount of the input raw material cost presented by the Defendant was released from the company because it was derived from the production quantity of the product based on the mixed ratio that the Plaintiff submitted and sought the estimated input volume of raw material and then multiplied by the average purchase price. In the business year 2009 and 2010, the Defendant claimed that the estimated amount of the input raw material cost and the actual cost on the account book are similar (the Defendant is in this point based on the rationality and legitimacy of these estimation methods) while the key inventory was that the difference between the estimated amount of the input raw material cost and the actual cost on the account book was high in the business year 2011.

B) However, in light of the following circumstances acknowledged by comprehensively considering Gap evidence Nos. 21, 22, 23, Eul evidence Nos. 7, 8, and 9, and the purpose of the testimony and the whole pleadings as a witness **, it is clear that the method of calculating the amount of the defendant's input raw material cost is calculated according to the presumption method and presumption standard that the actual value is not reflected at all, and that it cannot be considered as the basis for the escape from the company because the reasonableness is not guaranteed.

(1) As asserted by the Defendant, the presumption amount of the cost for the annual input raw materials from 2009 to 2012 and the actual cost on the account book are as follows.

However, while the stock difference in 2011 was about KRW 2.5 billion, according to the entry in the above list, the difference between the estimated amount of the input raw material cost in 201 and the actual cost in the account book was about KRW 4.4 billion and the difference was about KRW 1.7 times as a result of the error of KRW 1.97 billion. In addition, in the case of the business year 2012, there is a problem that the estimated amount of the input raw material cost rather than the estimated amount of the input raw material cost in the account book is about the actual cost and the difference is about the math.

(2) The combination ratio (the "joint ratio" means the combination of raw material inputs for the production of a product. At the time of the tax investigation, the plaintiff presented a total of 12 inputs per product) as calculated on the basis of the business year 2012. The plaintiff did not have a systematic inventory management system until the company newly established Aluminum business division in 2009 and conducted a large-scale inventory inspection in 2011. As seen above, it is more strict and accurate inventory management began with more strict and accurate performance of inventory management and estimating the cost of raw material inputs for the production of each raw material in 2009 and 2010, the first business foundation using a sample of each product for the combined ratio in 2012, which was relatively certain. It cannot be guaranteed that the substance is not reflected in the previous business year's production environment, etc.

(3) In estimating the input raw materials cost, the Defendant calculated the input volume of 12 raw materials for each kind of product of the Plaintiff Company based on the actual production quantity for the business year from 2009 to 2012, as follows, and followed the method of using the arithmetic mean calculated by dividing it by 12 after simple suming it.

However, in the product manufacturing process using actual raw materials, since the sample distribution cost of 12 persons is not used as equal frequency, and a variety of mixing cost is applied to different frequency, it is highly likely that the defendant's assertion that it is the presumption value of actual input raw materials cost in the past business year by simply calculating the input raw materials cost under the premise that all sample distribution cost is used equally without statistical consideration.

(4) In addition, in the process of estimating the cost for input raw materials, the defendant's recovery rate by each raw material (the recovery rate means the pure aluminium unit ratio that can be produced by using one raw material unit as a pure aluminium unit) is high.

The estimated input amount by raw material was calculated on the premise that it was fixed, but the rate of recovery should be changed depending on the time of storage, storage period, quantity of water content, degree of inclusion of foreign substance, etc. due to the characteristics of raw material that entails heavy loss depending on whether it contains hydrogen and foreign substance, and it is also affected by other production technology, raw material management system, etc.

3) Sub-determination

Ultimately, in full view of the fact that the stock difference found in the process of inventory inspection in 2011 was found as a result of the inventory inspection ** factory head fixed** the employee was responsible for inventory management, and that the Plaintiff prepared specific improvement measures to improve the inventory management system, etc., it is reasonable to view that the stock difference is merely the stock difference which should have been included in the raw material cost in the business year 2009, 2010 due to the characteristics of raw materials naturally accompanied by heavy loss and the lack of the Plaintiff’s inventory management procedure, and there is no other evidence to prove that the stock difference was out of the company. Unless there is no evidence to prove that the sales difference was occurred to the Plaintiff in the business year 2011, the Defendant’s taxation based on the premise that the sales difference was out of the business year 2011, was conducted without the proof of taxation requirements, and thus, it is unlawful. Accordingly, the notice of the income amount in the business year 2011 and 2011 should be revoked.

3. Conclusion

Therefore, the plaintiff's claim of this case is reasonable, and it is so decided as per Disposition.