[Seoul High Court 2007Nu5013 ( November 22, 2007)]

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

The court's explanation about this case is identical to the entry in the reasoning of the judgment of the court of first instance other than to dismiss or add a part of the entries in the reasoning of the judgment of the court of first instance as follows. Thus, it is citing it as it is in accordance with Article 8 (2) of the Administrative Litigation Act and Article 420 of the

A. The reasons for the judgment of the court of first instance are as follows: Section 1-A. (No. 5 of the judgment of the court of first instance to Section 10) (No. 2 of the judgment of the court of first instance).

A. "○○○ Co., Ltd. (hereinafter referred to as "Plaintiff Co., Ltd."), which appeared in the first instance judgment column, committed all "Plaintiff Co., Ltd. (hereinafter referred to as "Plaintiff Co., Ltd.") with 100,000, 000, Seoul ○○○○-dong Co., Ltd. (hereinafter referred to as "OO○-dong Co., Ltd.") paid 2,714,854,9040,000 won out of 2,714,854,90,900,000 won out of 150,000 won out of 195,000,000 won in cash instead of acquiring ○○○-dong Co., Ltd. (hereinafter referred to as "O○-dong Co., Ltd.")'s liabilities with 2,000,000,000 won in accounting, was not appropriated as a debt of 2,000,000 won in 195,000 won,0000 won.

(b) The reasoning of the judgment of the first instance shall be amended by adding "(3), (4), and (3)" following the following to "(5), (2), which appears to have "(5), (2), and (3)"(3) in the part(2) of Article 2-3(3).

"Third, according to the above variable accounting of the Plaintiff Company, the Plaintiff Company could immediately leak cash as if it repaid the Plaintiff Company's debt to the 12 shareholders in cash, but it can be known that it leaked cash through one further account title "outward purchase amount". The account title "outward purchase amount" is an account title appropriated as a major general commercial transaction of the Plaintiff Company's business, i.e., the obligation arising from the Plaintiff company's trade, and it can be viewed that the Plaintiff Company's use of such "outward purchase amount" account is an active act to ensure that it can not be easily discovered facts related to the disposition of this case by mixing the outflow of the capital increase in this case with the sale of the goods. In fact, where a bonus of 2 billion won is supplied to the Plaintiff Company's 12 shareholders in an abnormal manner, it cannot be viewed that a large amount of bonus burden (1.60 million won per shareholder) is not changed from the standpoint of the Plaintiff Company's business owner, and thus, it cannot be viewed that the bonus burden of the Plaintiff Company's 20 billion won begins.

(c) The reasons for the judgment of the first instance court are as follows: (c) the end of Article 2-2(2) should be “(2)” (as from No. 5 of the first instance judgment to No. 1), followed by the following additional determinations:

"The plaintiff (the plaintiff did not have any income accrued from the provisional payment of this case, and the capital increase remains in the plaintiff company, and thus it cannot be deemed to have evaded taxes due to unlawful act. However, as seen above, as long as the plaintiff company illegally discloseds the funds held by the window dressing accounting as if it was paid 2 billion won to the shareholders, it is reasonable to view that the funds were reverted to the shareholders of the above Kim○, etc. after the outflow of the funds. Thus, the above argument is rejected)"

2. Conclusion

Therefore, the judgment of the court of first instance is legitimate, and the plaintiff's appeal is dismissed without merit. It is so decided as per Disposition.

[Supreme Court Decision 2007Du25985, Oct. 14, 2008]

The costs of appeal are assessed against the Plaintiff.

[Seoul Administrative Court 2006Guhap29249, October 12, 2007]

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

A. The Plaintiff, a corporation operating a sale and brokerage business of daily necessities in Seoul 00-dong 000-dong 000, paid 714,854,904 won out of 2,714,854,904 won and the remainder of 2 billion won, instead of taking over the composition debt of 00-dong 00-dong 00-dong 00-dong 2 billion won, but instead of appropriating 2 billion won as the composition debt of 2 billion won and paid the unpaid rental deposit.

B. 1.99 to 200,000 won out of the Plaintiff’s deposit that was leaked as above accounting was reverted to 12 shareholders, Kim 00,00, and the Plaintiff’s capital increase during the business year from 199 to 2000 (the 450,000 million won on July 15, 199, August 16, 199, 199, 50,000,000 won on December 15, 199, 50,000 won on November 16, 200) was paid as the capital increase amount of shareholders (the price for the instant capital increase).

C. The defendant investigated the portion of corporate tax against the plaintiff from August 3, 2002 to October 10 of the same year and confirmed the above facts, and notified the plaintiff to the plaintiff on October 7, 2002 that the plaintiff paid the amount corresponding to the amount of the capital increase in this case to 12 shareholders, including Kim 00, and notified the plaintiff on October 7, 2002 that the amount of the capital increase in this case should be imposed. On January 3, 2003, the defendant reserved the amount of 1.95 billion won as the provisional payment to the shareholders as the provisional payment for the capital increase in the gross income, while the interest recognized as the provisional payment in the gross income was added to the bonus and the dividend disposition as well as the interest paid in deductible expenses, and other outflow from the company, thereby imposing and notifying the corporate tax in each business year for the plaintiff

D. On March 15, 2003, the Plaintiff filed a request for a review of the national tax with the purport that the acquisition amount of composition liabilities should be included in deductible expenses, against the disposition of imposition of the above corporate tax, and the Commissioner of the National Tax Service decided on December 22, 2003 that the acquisition amount of composition liabilities should be included in deductible expenses, and the tax base and tax amount should be corrected by adding the acquisition amount of composition liabilities to deductible expenses. According to the above review and decision, the Defendant reduced or corrected corporate tax for each business year of 199

E. On the other hand, on February 1, 2005, the director of regional tax office issued a disposition order that the defendant disposed of the capital of this case as provisional payment by deeming it as provisional payment as internal reserve. Since the deposit of a corporation was leaked out to an extent that it actually reverts to a shareholder as a result of accounting change, it should be disposed of as bonus or dividend to the shareholder. Accordingly, on May 10, 2005 after correcting the corporate tax of each business year of 1999, 200, and 2001, the defendant issued a disposition that reduced the corporate tax of each business year of 276,276,000 (the representative director Kim 00 and 667,000,000,000 won paid to 0, 2000, 88, 2000, 2008, 309, 201, 209, 309, 209, 2001.

[Ground of Recognition] A without dispute, Gap evidence 1-2, Eul evidence 2-3, Eul evidence 1-1, Eul evidence 1-2, Eul evidence 1-2, Eul evidence 2-2, Eul evidence 4-1, 2-2, Eul evidence 5, Eul evidence 5, Eul 6-7, Eul evidence 8, 9, 10, Eul evidence 11-1, 2, Eul evidence 12, Eul evidence 13-1 through 4, and the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiff's assertion

Article 26-2 (1) 3 of the Framework Act on National Taxes is the exclusion period of Article 26-2 (1) of the Framework Act on National Taxes, since the Plaintiff paid provisional payment to Kim 00 and Yellow 00, thereby making the payment of the capital increase, which is merely a legal capital increase due to managerial reasons, and since the capital increase was not leaked out, it does not evade taxes due to fraudulent or other unlawful acts. Thus, the instant disposition was made five years after the said exclusion period of imposition, which is the day following the payment period of the withholding tax that was due to the Plaintiff’s obligation to withhold taxes, was unlawful.

(b) Related statutes;

[Framework Act on National Taxes]

Article 26-2 (Period for Excluding Assessment of National Tax)

(1) No national tax may be levied after the period as provided in the following subparagraphs expires: Provided, That if the mutual agreement procedures are in progress under the provisions of a treaty concluded to prevent double taxation (hereinafter referred to as "tax treaty"), Article 25 of the Adjustment of International Taxes Act shall apply:

1. Where a taxpayer evades a national tax, or receives a refund or deduction by fraudulent or other unlawful means, for ten years from the date on which the national tax is assessable;

2. If the taxpayer fails to file a written tax base return within the legal return term, for seven years from the day on which the national tax is assessable;

3. If it does not fall under subparagraphs 1 and 2 above, for five years from the day on which the national tax is assessable; and

C. Determination

(1) According to Article 26-2(1)1 of the Framework Act on National Taxes, a taxpayer may impose a national tax for 10 years from the date on which the national tax can be imposed in cases where the taxpayer evades, obtains a refund or deduction by fraudulent or other unlawful means. Here, “Fraud or other unlawful acts” is an act which makes it possible to evade the tax, and is a deceptive scheme or other affirmative act which makes it impossible or considerably difficult to impose and collect the tax (see, e.g., Supreme Court Decisions 78Do2308, Nov. 28, 1978; 78Do2308, Nov. 28, 197).

(2) In the instant case, ① The non-paid rental deposit 2 billion won that the Plaintiff had to pay to the 00-year public officials was due to the Plaintiff’s acceptance of the composition obligation of 2 billion won public officials, and the obligation to pay the deposit 2 billion won has ceased to have been extinguished, as if the deposit was paid by withdrawing the deposit 2 billion public officials, the accounts were modified, and the composition debt 2 billion won was reverted to the shareholders, and the account was divided by omitting the composition debt 2 billion public officials, and any measure was not taken against the money reverted to the above shareholders

② If the provisional accounting of the capital increase in this case was made on November 30, 202, the Plaintiff’s funds were appropriated as the provisional payment and was added to the gross income for 199,200 business year as well as non-inclusion of interest and loss at the time of the settlement of the corporation, respectively, and the above provisional payment interest rate constituted income of the shareholder, etc. as bonus or dividend belonging to the shareholder, etc., but the Plaintiff’s selection of an irregular accounting method without such accounting as above seems to have the purpose of tax evasion. ③ Even if the Plaintiff conducted the capital increase in this case as of November 30, 202, and then the provisional payment was made against the above capital increase amount, it is difficult to view that the Plaintiff’s act related to the capital increase in this case’s separate transactions after October 7, 2002, which was notified that the above provisional payment would have been corrected as to the above amount of the capital increase in this case’s capital increase, and the Plaintiff’s act related to the capital increase in this case’s calculation constitutes a series of 10 years old or tax evasion.

(3) Therefore, the instant disposition, which was made from April 11, 200, the day following the deadline for payment of withholding tax on earned income for the year 1999, before the exclusion period of imposition expires ten years, shall be deemed lawful.

3. Conclusion

Thus, the plaintiff's claim is dismissed for lack of reason.