[2] In a case where the actual supplier and the supplier on the tax invoice are different, the requirements for the recipient to deduct or refund the input tax amount and the burden of proof

[3] Where a tax invoice for a part of the expenses reported by a taxpayer is false, the person who bears the burden of proving that it is an actual cost

[2] Unless there are special circumstances, such as that the actual supplier and the supplier on a tax invoice are not negligent in not knowing the fact that the supplier was unaware of the name of the tax invoice and that the supplier was not negligent in not knowing the fact that the supplier was not negligent in not knowing the fact that the supplier was unaware of the name of the tax invoice, the person who asserts the deduction or refund of the input tax amount

[3] If a tax invoice on a part of the expenses reported by a taxpayer is proved to have been prepared by a tax authority without a real transaction, and it is disputed as to whether it is an actual cost and the other party to the payment of the expenses claimed by a taxpayer has been proved to have been significantly false, it is necessary for a taxpayer to prove that such expenses have been actually paid, which is easy to present all data, such as the account book keeping and evidence, etc.

1. As to the grounds of appeal by Plaintiffs 2, 3, and 4

A. Article 56(2) of the former Framework Act on National Taxes (amended by Act No. 911, Jan. 1, 2010) provides that “ Notwithstanding the provisions of Article 18(1) main sentence, Article 18(2) and (3) of the Administrative Litigation Act, any administrative litigation against any illegal disposition as provided in Article 55 shall not be instituted without going through a request for examination or adjudgment under this Act and a decision thereon.” Thus, the former Framework Act on National Taxes (amended by Act No. 9911, Jan. 1, 20

In the tax administration, two or more administrative dispositions for the same purpose were taken in the course of step-by-step and development, and are related to each other. Whether the tax authority changed the taxation disposition subject to such disposition during the continuation of tax administrative litigation and the reason for illegality is common, or where several persons are jointly liable for the same administrative disposition due to the same administrative disposition, it is unlawful to file a claim for revocation of the taxation disposition without going through the procedure of the preceding trial where one of the persons liable for tax payment and the Tax Tribunal grants an opportunity to re-determine the basic facts and legal issues, and where there are justifiable reasons, such as where one of the persons liable for tax payment and the National Tax Tribunal grants an opportunity to make a re-determination of the basic facts and legal issues, and where it seems that it would be harsh that the taxpayer would go through the procedure of the preceding trial and make the person liable for tax payment go through the procedure of the preceding trial (see Supreme Court Decision 2007Du25817, May 28, 2009, etc.).

B. On June 11, 2010, the lower court acknowledged that: (a) on June 11, 201, the Defendant filed a request for the revocation of the first disposition with the Tax Tribunal; (b) on the first disposition imposing the value-added tax for the first and second years of 2007 and the first year of 2007 and corporate tax for each business year of 2008; and (c) on the Plaintiff Company did not pay the said value-added tax and corporate tax by the payment deadline; (b) on July 16, 2010, the Defendant designated Plaintiff 2, 3, and 4, who is an oligopolistic shareholder of the Plaintiff Company, as the second taxpayer; and (c) on the second disposition imposing the said value-added tax and corporate tax, the Plaintiff Company rejected the request for the revocation of the second disposition with respect to the second disposition; (c) on the grounds that the second disposition was not subject to the second disposition by the Commissioner of the Tax Tribunal, and determined that it constitutes an unlawful disposition with respect to the Plaintiff’s main tax obligor’s imposition requirement, other than the second disposition.

C. Examining the relevant provisions, legal principles, and records, the lower court did not err in its judgment by misapprehending the legal principles on mitigation of the procedure in the previous trial as alleged in the grounds of appeal.

2. As to the Plaintiff Company’s ground of appeal

A. Unless there are special circumstances, such as that the actual supplier and the supplier on a tax invoice did not know the fact that the person who received the other tax invoice was not aware of the fact that the supplier knew of the name of the tax invoice, and that the person who received the tax invoice was not negligent in not knowing the above fact that the supplier was not aware of the fact of the name of the tax invoice, the person who asserts the deduction or refund of the input tax amount must prove it (see, e.g., Supreme Court Decision 2009Du1808, Jun.

In addition, if a tax invoice on a part of the expenses reported by a taxpayer is proved to have been prepared without real transactions by the defendant who is the tax authority without real transactions, and it is disputed as to whether it is an actual cost and the other party to the payment of the expenses claimed by the taxpayer has been proved to the extent that it is reasonable that the other party to the payment was false, a taxpayer who is easy to present all the data, such as the account books and evidence, should prove that such expenses have been actually paid (see Supreme Court Decision 2010Du28076, Apr. 28, 201, etc.).

B. In light of the circumstances stated in its holding, the lower court rejected all the Plaintiff’s assertion that, inasmuch as the instant tax invoice that the Plaintiff Company received from the Plaintiff Company is deemed due to a disguised transaction or processing transaction, and thus, the first disposition denying the inclusion of input tax deduction and deductible expenses based on the instant tax invoice is lawful, the Plaintiff Company’s failure to know that the Plaintiff Company was unaware of the name, and was not negligent in not knowing the name, or the amount equivalent to the purchase price based on the processing transaction was disbursed as an actual cost, on the ground that there is insufficient proof by the Plaintiff Company, as to the fact that the input tax amount on the disguised transaction should be deducted and the purchase price for the fictitious transaction should be included in deductible expenses.

C. Examining the relevant provisions, legal principles, and records, the lower court’s determination is justifiable. In so doing, contrary to what is alleged in the grounds of appeal, the lower court did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or by misapprehending the legal doctrine on the burden of proof of actual costs, in the event

3. Conclusion

All appeals are dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Yong-deok (Presiding Justice)