Cheongju District Court-2015-Gu Partnership-1528 ( dated 14, 2017)

Examination-corporation-2014-0048 (Law No. 27, 2015.04)

Whether the beneficial owner of the capital gains from the transfer of stocks is a person or a duplicate investigation;

It is reasonable to deem that the beneficial owner of the transfer income of the instant shares is a Singapore corporation that is a party to the instant stock acquisition agreement, and it is reasonable to deem that the tax investigation in 2013 and the on-site confirmation in 2014 constituted a duplicate tax investigation.

[Related Acts]

Article 93 of the former Corporate Tax Act (Domestic Source Income)

Daejeon High Court (Cheongju)-2017Nu3497 ( August 29, 2018)

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o Head of the tax office

2018.05.09

208.29

1. The defendant's appeal is dismissed.

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

1. Purport of claim

The Defendant’s imposition disposition of KRW 115,645,612,260 of corporate tax withheld in the business year 2009 and the imposition disposition of KRW 11,564,561,220 of corporate tax imposed on the Plaintiff on August 7, 2014 is revoked.

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. Quotation of judgment of the first instance;

The reasons for this court's decision are as follows, and they are the reasons for the judgment of the court of first instance except for the second part and the second part of the judgment, so they are cited by Article 8 (2) of the Administrative Litigation Act and the main sentence of Article 420 of the Civil Procedure Act.

2. Parts and additional judgments

A. The height part

1) The part of the second sentence of the first instance court's judgment from 9 to 7 and the part from 9 to 12 "less there is no land" is deleted. The part of the second sentence of the first instance court's judgment from 13 to 13 is added, and it is difficult to see Singapore corporation as simple Domination," and the part of the first sentence is 14 as Singapore corporation.

2) As seen in Section 10 of Article 11 of the first instance judgment, the Defendant added “Evidence Nos. 5, 7, 2, 8, 24, and 26” to “Evidence Nos. 7, 2, 24, and 26 of the National Tax Act” (Article 81-4(2)1 of the Framework Act on National Taxes) and “Evidence Nos. 8 and 5 of the first instance judgment explain that the evidence No. 8 and 12 were already from the tax investigation in 2009” (Article 81-4(2)1 of the Framework Act on National Taxes).

3) Each part of the 13th sentence, 16th sentence, 17th sentence, 17th sentence, or 2 of the first instance court's "tax investigation (2013)" shall be deleted from "the part of 2009 business year corporate tax (2009)", "the corporate tax (2009) of the 2013 tax investigation," "the 15th 9th sentence to "the time" and "the 13th sentence to 20th sentence (4), "the 16th sentence to "the tax investigation of 2013" to "the 7th sentence from "the 2013 tax investigation" to "the 13th sentence to 20th 6th sentence."

B. Additional determination (Judgment as to whether on-site verification in 2014 constitutes double tax investigations)

1) Even if the Defendant’s assertion that the tax investigation in 2013 was lawful, the instant disposition based on the instant disposition is unlawful even in this regard, as seen below, since the on-site investigation in 2014 constitutes a duplicate tax investigation.

2) Determination as to whether on-site inspections in 2014 constitute duplicate tax audits

A) Relevant legal principles

In light of the nature and effect of a tax investigation, the purport of prohibiting duplicate tax investigations, etc., in a case where a tax official’s investigation affects taxpayers’ freedom of business by having taxpayers answer questions and undergo an inspection, etc., it shall be deemed as a “tax investigation prohibited from re-audit” even if it follows the procedure of “local confirmation” under the Regulations on the Management of Investigations, which is the instructions of the National Tax Service. However, in a case where it is deemed that all investigation conducted by the tax authority for the collection of taxation data or for the verification of accuracy of the details of the report constitutes a tax investigation prohibited from re-audit, the tax authority should always commence a regular tax investigation in sufficient cases only with the confirmation of facts, and the taxpayer, etc. must also respond to an indefinite tax investigation. Thus, it does not constitute a “tax investigation prohibited from re-audit” even if the taxpayer, etc. has no duty to answer or accept, and the taxpayer, etc. is not obligated to do so,

Whether an investigation conducted by a tax official constitutes a "tax investigation prohibited by re-audit" can not be determined individually in specific cases by comprehensively taking into account the purpose and progress of the investigation, object and method of the investigation, data acquired through the investigation, scale and period of the investigation, etc. However, it is difficult to view it as a "tax investigation prohibited in principle where a taxpayer, etc. is expected to easily respond to the investigation or where it does not have a big impact on the taxpayer's freedom of business, etc., such as confirmation of the status of a place of business, simple confirmation of bookkeeping, confirmation of specific sales, confirmation through the issuance of administrative civil petition documents, receipt of data voluntarily submitted by the taxpayer, etc., and thus, it is difficult to regard it as a "tax investigation prohibited by re-audit" in cases where a tax official's investigation is conducted for the purpose of determining or correcting the tax base and amount of tax, and directly contact the taxpayer, etc. on a considerable period of time in the office, workplace, factory, or residence of the taxpayer, etc., or inspection and investigation for a certain period of time (see, e.g., Supreme Court Decision 2016Du36.

B) Determination

On July 29, 2014, the Director of the Regional Tax Office issued a notice of on-site confirmation to the Plaintiff. From July 30, 2014 to August 5, 2014, 2009, “to verify additional facts related to the Plaintiff’s acquisition of shares and Singapore” to the Plaintiff. National tax investigators of the investigating State *** On-site confirmation certificate was issued to the Plaintiff by 3 employees such as the National Tax Investigator of the o regional tax office, etc. (the Defendant’s assertion) visited the Plaintiff’s office for 20 hours in order to verify on-site, or by 30 hours in response to the Plaintiff’s request on July 31, 2014, the head of the Regional Tax Office issued 20 to the Plaintiff for a specific period of 30 hours in response to the Plaintiff’s request for tax investigation, and the head of the Regional Tax Office’s request on July 31, 2014.

3) Determination as to whether there are grounds for reinvestigation permissible under the Framework Act on National Taxes

“A) In the case where field verification in 2014 constitutes a tax investigation, the Defendant asserts that re-audit is permitted on the grounds that the Sviser’s Closing Clostific rate (Evidence 5), tender-related documents (Evidence 6), ****** (Evidence 7), call option contract(Evidence 8) as stipulated in Article 81-4(2)1 of the Framework Act on National Taxes falls under the “clear evidence to acknowledge suspicion of tax evasion”.

Article 81-4(1) of the Framework Act on National Taxes provides that "tax officials shall conduct a tax investigation to the minimum extent necessary to realize proper and fair taxation, and shall not abuse their authority to investigate for any other purpose, etc." Paragraph (2) provides that "where there is clear evidence to acknowledge a suspicion of tax evasion, where investigation is necessary for the other party to the transaction, or where there is errors in connection with two or more business years, or other similar cases prescribed by Presidential Decree, a reinvestigation cannot be conducted for the same tax item and the same taxable period." In principle, reinvestigation of the same tax item and the same taxable period shall not be allowed. In light of these regulations and the purport thereof, "where there is clear evidence to acknowledge a suspicion of tax evasion" provided for in Article 81-4(2) of the Framework Act on National Taxes shall be limited to cases where a reinvestigation is exceptionally permitted, and it shall be interpreted that such materials are not included in the previous tax investigation (see, e.g., Supreme Court Decision 201Du6380, Jan. 27, 2011).

C) Determination

First, even if the defendant's assertion is based on the defendant's claim, the Slstling Co. 5 and call option contract was submitted at the time of the tax investigation in 2009 (the defendant's preparatory document in the first instance court of August 22, 2016). Thus, the above documents cannot be viewed as clear material to acknowledge the suspicion of tax evasion exceptionally permissible, regardless of the defendant's assertion, since they are already investigated in the previous tax investigation regardless of whether they were later new ones as the defendant's assertion," and second, from among bid-related documents (Evidence 6), it is difficult to view that the possibility of tax evasion exists to the extent that the defendant's disposal of the shares issued by the plaintiff at the purchaser's direct purchase of shares of the corporation of Singapore constitutes 80 years old since it is hard to view that the defendant's disposal of the shares constitutes 10 years old from the date of tax investigation under the above 20-year provision of this case's new shares acquisition under the law as one of the above 20-year provision of this case's shares acquisition.

3. Conclusion

Therefore, the plaintiff's claim of this case shall be accepted on the grounds of its reasoning. The judgment of the court of first instance is just in conclusion, and the defendant's appeal is dismissed as it is without merit. It is so decided as per Disposition.