2. The costs of appeal shall be borne by the Plaintiff.

The Defendant’s disposition of imposition of KRW 250,163,10 as corporate tax for the year 2002 against the Plaintiff on October 16, 2006 (which appears to be a clerical error in October 2, 2006) shall be revoked.

The reasoning of the judgment of this court is that "5.11 billion won, total of 10.11 billion won, total of 10.1 billion won, total of 5.1 billion won," among the judgment of the court of first instance, "total of 10.10 billion won, total of 10.11 billion won," "one hundred billion won," "from the bottom of the same side, 20.16" "from October 2, 2006," and "former Corporate Tax Act (wholly amended by Act No. 6852, Dec. 30, 2002)" shall be "corporate Tax Act", and "the former Corporate Tax Act (wholly amended by Act No. 6852, Dec. 30, 200)" shall be cited in the judgment of the court of first instance, except for the addition of the following judgments, it shall be cited in accordance with Article 8 (2) of the Administrative Litigation Act and the main sentence of Article 420 of the Civil Procedure Act:

2. The addition;

Although the Plaintiff’s stock transaction between himself and the non-party company violates the provisions of the Commercial Act and becomes null and void, the substance of the transaction is recognized in the application of the Corporate Tax Act. Thus, it is not reasonable to deny the substance of the transaction, and to regard it as “a loan or other equivalent claim, which should have been collected,” but as long as the sales contract is null and void, even if the purchase price was paid to the transferor, it cannot be deemed as a transfer of assets subject to capital gains tax or an income accrued from the transfer of assets (see, e.g., Supreme Court en banc Decision 05Nu18383, Mar. 20, 197). In light of the above, it should be determined on the premise that the sales contract is null and void, since the Plaintiff’s above assertion is without merit, in determining whether the sales price paid falls under an amount of temporary payment under Article 28(1)4(b) of the Corporate Tax Act.

In addition, the plaintiff asserts that it is not reasonable in light of sound social norms and commercial practice since it was paid to the non-party company with the intention of normal transaction. However, in order to avoid the application of the prohibition on the acquisition of self-owned shares as seen earlier, the plaintiff borrowed a name such as ○, etc. to avoid the application of the prohibition on the acquisition of self-owned shares from the non-party company, thereby undermining the company's capital foundation by returning the paid-in capital to the non-party company, which was a major shareholder, thereby undermining the company's capital foundation and impairing the interests of the company, shareholders, and creditors, and also violated the principle of the equality of shareholders. The non-collection of the paid-in shares in the above circumstance goes against sound social norms and commercial practice. Thus, the above assertion is without merit.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and the judgment of the court of first instance is just, and the plaintiff's appeal is dismissed as it is without merit, and it is so decided as per Disposition.

[Seoul Administrative Court 2007Guhap34767, April 18, 2008]

2. The costs of lawsuit shall be borne by the Plaintiff.

A. On April 21, 200, the Plaintiff: (a) an individual, including KRW 5 billion; (b) Jin○, a joint representative director; and (c) the largest ○○○○, a joint representative director (hereinafter referred to as “ Jin○, etc.”); and (d) a corporation incorporated by investing KRW 5.1 billion; (b) a total of KRW 10 billion; and (c) a total of KRW 10.1 billion (Issuance 2,022,000; hereinafter referred to as “Issuance 5 billion”); (d) on August 16, 2001, a transfer transfer was made with respect to KRW 50,000,000 issued stocks of the Plaintiff corresponding to KRW 5 billion (the share ratio of KRW 49.46%; hereinafter referred to as “occupant stocks”).

B. As a result of the tax investigation against the plaintiff, the director of the regional tax office entered into a contract that the ○○○ et al. acquired the outstanding shares from the non-party company with the purchase price of KRW 5.530 million (hereinafter referred to as "indivantity gold"), and confirmed the fact that the acquisition fund was deposited out of the plaintiff's account and paid out from the plaintiff's account, and transferred the shares to the plaintiff ○○○ Co., Ltd. with the 120,000,000, respectively, and notified the defendant of the issue amount as taxation data by deeming that it constitutes a provisional payment irrelevant to the plaintiff's business.

C. In accordance with the above taxation data notification, the defendant deemed that the plaintiff was paid provisionally to ○○, etc., who is a related party without connection with the business, and calculated the recognized interest rate, and added 142,697,998 won to gross income, and added 135,793,936 won to gross income, and added 135,93,936 won paid to the plaintiff on October 16, 2006, and corrected and notified 250,163,110 won of corporate tax for 202 business year to the plaintiff (hereinafter "disposition

[Grounds for Recognition: Evidence No. 1, Evidence No. 1-1 to No. 12, and the purport of the whole pleadings]

2. Whether the disposition is lawful;

A. The parties' assertion

1) The Plaintiff acquired shares in question by lending its own shares in the name of Jin-○, etc.

The disposition of this case, based on the premise that the plaintiff lent the acquisition fund to Jinjin-○ et al. for acquiring the outstanding shares, is unlawful. The defendant asserted that the disposition of this case is unlawful. 2) The defendant, since Jinjin-○ et al. lawfully acquired the outstanding shares and registered the plaintiff's funds in the plaintiff's register of shareholders, withdrawn the plaintiff's funds, and used them as the acquisition fund. Thus, it is reasonable to view that the plaintiff lent the outstanding shares to Jinjin-○ et al., and even if the plaintiff is deemed to have acquired the company's own shares by lending the name of Jinjin-○ et al. as alleged by the plaintiff, the acquisition is invalid in violation of the prohibition of acquiring the company's own shares under the Commercial Act. The non-party company's status as the plaintiff's specially related person,

B. Relevant statutes

The entry in the attached Form shall be as follows.

(c) Fact of recognition;

1) On August 16, 2001, pursuant to a share purchase agreement between the non-party company and Jinjin, etc., a share purchase agreement between the non-party company and the non-party company was transferred in 50,000 shares of the plaintiff of the non-party company to Jinjin ○, etc. [each share of 80,000 shares (3.96%) and 5,530,000 won of the transfer price was withdrawn from the plaintiff's account and paid to the non-party company.

2) Meanwhile, a company with the Plaintiff’s employee prepared August 16, 2001 and approved by the joint representative director.

In the internal part, the plaintiff's own shares of the non-party company shall be acquired at the par value of KRW 5.53 billion in total with certain interest rates attached to the non-party company's own shares, but the resolution of the general meeting of shareholders, which is the procedure for acquiring treasury shares, shall be omitted, but the name shall be the joint representative.

3) On April 1, 2002, on April 1, 2002, 400,000 shares issued by Jindo et al. were transferred to the Plaintiff.

4) On May 31, 2002, 200 won of the Plaintiff’s 60,000 shares issued by Jin○, etc. were transferred to the promotion of the corporation, and at the same time, the transfer price was deposited directly into the Plaintiff’s account. on the same day, Jin○, etc. deposited the shares price for 40,000 shares into the Plaintiff’s account. [The grounds for recognition: facts without dispute, Gap’s evidence, Eul’s statements, Eul’s 2, 3, and 5’s each statement, and the purport of the entire pleadings

D. Determination

1) Whether it constitutes the acquisition of treasury stocks under the Commercial Act

Even if a company acquires shares in the name of a third party, if the funds for acquiring the shares are made by the company’s contribution and the profits and losses accrued from the acquisition of the shares are attributed to the company, the acquisition of such shares constitutes the acquisition of treasury shares prohibited by Article 341 of the Commercial Act (see, e.g., Supreme Court Decision 2006Da33609, Jul. 26, 2007). It is reasonable to deem that the acquisition of the shares constitutes a case where the Plaintiff acquired treasury shares on its own account by lending its name under the name of Jin○, etc., and it is null and void as it violates Article 341 of the Commercial Act, unless the exception provided for in the Commercial Act or any other Act exists (see, e.g., Supreme Court Decision 2006Da33609, Jul. 26, 2007).

2) Whether it constitutes a provisional payment without office

The provisional payment related to the non-deductible interest under Article 28 of the Corporate Tax Act and Article 53 of the Enforcement Decree of the same Act includes not only purely meaningful loans, but also loans corresponding to the nature of claims, such as indemnity bonds, etc. It shall be objectively determined on the basis of the purpose of business or business contents of the relevant corporation (see, e.g., Supreme Court Decision 2005Du1558, Oct. 26, 2006). Thus, the non-party company constitutes a shareholder of the outstanding shares and constitutes a related party of the plaintiff. As seen earlier, the acquisition of the outstanding shares from the non-party company constitutes null and void. As such, the issue amount that the plaintiff acquired without any legal cause is paid to the non-party company and thus, the plaintiff must immediately recover it from the non-party company. The fact that the plaintiff delayed or avoided the collection without any justifiable reason is considered to have been paid to the non-party company regardless of the business affairs of the Plaintiff.

3) Whether the act constitutes wrongful calculation

The wrongful calculation under Article 52 of the Corporate Tax Act refers to the calculation of an act to reduce or exclude the tax burden that arises when a taxpayer takes the ordinary rational transaction form by taking the bypassing act, the multi-stage act and other abnormal transaction form without a reasonable transaction form. The determination of whether such economic rationality exists shall be based on whether the transaction lacks economic rationality in light of sound social norms or commercial practices (see, e.g., Supreme Court Decision 2002Du11479, Feb. 13, 2004). Thus, the issue amount that the Plaintiff paid to the non-party company paid to the non-party company should be recovered since it was paid without any legal cause, and the failure to recover it without any justifiable reason is an abnormal act contrary to the economic rationality in light of sound social norms and commercial practices, which constitutes "an act of lending or other similar act under Article 8 (1) 6 and 9 of the former Enforcement Decree of the Corporate Tax Act (wholly amended by Presidential Decree No. 17826, Dec. 30, 2002).

4) Additional statement of the reasons for the disposition

The subject matter of a lawsuit seeking the revocation of taxation is objective existence of the tax base and tax amount recognized by the disposition of the tax authority, and the tax authority may add or change the grounds for the disposition within the scope that maintains the identity of the disposition in order to support the legitimacy of the tax base and tax amount recognized by the disposition until the closing of argument at the trial court (see, e.g., Supreme Court Decision 2000Du2181, Mar. 12, 2002). As the grounds for the disposition of this case, the Plaintiff deemed that the Plaintiff lent the acquisition fund to Jin○ et al. for acquiring the outstanding stocks from the non-party company to Jin○ et al., as it deemed that the acquisition fund for acquiring the outstanding stocks from the non-party company in the name of Jin○ et al. was lent to the non-party company, and thus, the pertinent legal act should be recovered from the non-party company to the effect that the said legal act should be invalidated, and thus, the key matter is regarded as the payment by the non-party company unrelated to the business entity or the same amount.

5) Sub-decisions

Therefore, the key money source paid by the Plaintiff to the non-party company, who is a person with a special relationship, constitutes a provisional payment without relation to its business, and based on this, the tax base and tax amount of corporate tax in 2002 for the Plaintiff, who calculated the recognized interest rate as a basis of calculating the interest rate and excluded the interest interest from deductible expenses, are the same as the tax base and tax amount that are the premise of

3. Conclusion

Thus, the plaintiff's claim of this case is dismissed as it is without merit.

Relevant statutes

○ former Corporate Tax Act (amended by Act No. 6852 of Dec. 30, 2002)

Article 27 (Non-Inclusion of Expenses not Related to Business)

The following amounts of expenses paid by a domestic corporation for each business year shall be included in the calculation of income amount for the relevant business year, and shall not be included in the calculation of losses:

1. Amount prescribed by Presidential Decree, such as expenses, etc. incurred from the acquisition and management of assets prescribed by Presidential Decree as assets deemed not directly related to the business of the relevant corporation

2. The amount of expenditure that is deemed not directly related to the business of the juristic person as prescribed by the Presidential Decree other than subparagraph 1.

Article 28 (Non-Inclusion of Interest Paid in Loss)

(1) The interest on any of the following borrowings shall not be included in deductible expenses in calculating the income amount of a domestic corporation for each business year:

4. Of interest on loans paid during each business year by a domestic corporation which acquires or holds assets falling under one of the following items, the amount calculated under the conditions as prescribed by the Presidential Decree (limited to interest on loans equivalent to the value of the relevant assets):

(b) Provisional payments, etc. prescribed by the Presidential Decree to a person with a special relationship under Article 52 (1) without connection with the business of the relevant corporation; and

Article 52 Denial of Wrongful Calculation

(1) Where the head of the district tax office having jurisdiction over the place of tax payment or the Commissioner of the competent Regional Tax Office deems that the tax burden of a domestic corporation has been unjustly reduced through transactions with persons with a special relationship as prescribed by the Presidential Decree (hereinafter referred to as "specially related persons"), he/she may calculate the income amount for each business year of the relevant corporation regardless of the activities or calculation of the income amount of the relevant corporation (hereinafter

(2) In the application of the provisions of paragraph (1), sound social norms and commercial practices and the prices applied or to be applied in normal transactions between persons without a special relationship (including rates, interest rates, rents, exchange rates and other corresponding rates; hereafter referred to as "market prices" in this Article) shall be the basis.

(4) In applying the provisions of paragraphs (1) through (3), necessary matters concerning the types of wrongful calculation, assessment of market price, etc. shall be prescribed by Presidential Decree.

○ former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 17826, Dec. 30, 2002)

Article 53 (Non-Inclusion of Interest Paid on Non-Business Assets in Calculation of Losses

(1) The term “those determined by the Presidential Decree” in Article 28 (1) 4 (b) of the Act means, regardless of its title, the amount of loans (including the amount of loans that cannot be deemed the principal profit-making business in the case of financial institutions, etc. falling under any subparagraph of Article 61 (2) 4 (b) of funds which are not related to the business of the relevant corporation: Provided,

(2) The term "amount calculated under the conditions as prescribed by the Presidential Decree" in Article 28 (1) 4 of the Act means the amount calculated by the following formula:

Value of assets under the provisions of paragraphs (1) and Article 49 (1).

Total amount of loans (the total amount of loans)

Interest paid X e e e e e e e

Total loans

Article 87 (Scope of Person with Special Relationship)

(1) "Person in a special relationship prescribed by Presidential Decree" in Article 52 (1) of the Act means a person in a relationship falling under any of the following subparagraphs with a corporation (hereinafter referred to as a "person in a special relationship"):

2. Stockholders, etc. (excluding minority shareholders; hereafter the same shall apply in this Sub-section) and their relatives;

Article 88 (Calculation Type of Wrongful Acts)

(1) "Where it is deemed that the tax burden has been unjustly reduced" in Article 52 (1) of the Act means cases falling under any of the following subparagraphs:

6. Where cash and other assets or services are provided with no compensation or at an interest rate, tariff, or rental rate lower than the market price: Provided, That this shall not apply where company housing is provided to officers who are not stockholders, etc. or investors (including officers who are minority shareholders under Article 87 (2) and employees;

9. Other cases where it is deemed that activities, calculations or other distributions of the profits of the juristic person corresponding to those as referred to in subparagraphs 1 through 8 have occurred.

○ Commercial Act

§ 341. Acquisition of treasury shares

A company shall not acquire its own shares for its own account except in the following cases:

1. In case of the retirement of shares;

2. Where the merger of the company or acquisition by transfer of the whole business of another company is effected;

3. Where it is necessary to achieve its objective in exercising the right of the company.

4. Where it is necessary for the disposition of fractionalism.

5. When shareholders exercise their appraisal rights;