Supreme Court Decision 2008Du23146 (No. 14, 2009)

Seoul High Court 2007Nu14147 ( November 05, 2008)

No trade related to gold bullion shall be deemed a nominal transaction solely on the ground that a bombane company is opened in the middle of the trade related to gold bullion

It is difficult to conclude that the supply of goods is not a supply of goods solely on the basis of the fact that there is a wide carbon company that does not pay value-added tax at an intermediate stage, etc.

The contents of the decision shall be the same as attached.

1. Revocation of a judgment of the first instance;

2. The Defendant’s imposition of value-added tax against the Plaintiff on December 10, 2005, of KRW 7,998,898,960 for the second term of 2003, KRW 11,173,341,920 for the first term of 2004, and KRW 1,577,262,850 for the second term of 2004, and the imposition of value-added tax for the second term of 2004, KRW 2,89, KRW 782,398 for the nine months, shall be revoked.

3. All costs of the lawsuit shall be borne by the defendant.

The same shall apply to the order.

1. Quotation of judgment of the first instance;

The reasoning for the court's explanation in this case is as shown in the first instance court's decision, except for the first instance court's decision from the next to the second instance court's decision among the first instance court's decision.

2. Parts to be dried;

Article 1(1)1 of the Value-Added Tax Act provides that "the supply of goods as taxable subject to value-added tax" and Article 6(1) provides that "the delivery or transfer of goods shall be a delivery or transfer of goods on all contractual or legal grounds." In light of the characteristics of value-added tax as multi-stage transaction tax, delivery or transfer under Article 6(1) of the Value-Added Tax Act includes all acts causing the transfer of authority to use and consume goods, regardless of the existence of actual profits (see, e.g., Supreme Court Decisions 85Nu286, Sept. 24, 1985; 9Du9247, Mar. 13, 2001; 99Du9247, Mar. 13, 2001; 201; 30.1.6.6.

B. From July 1, 2003 to December 31, 2004, the Plaintiff purchased each of the instant gold bullion equivalent to KRW 179,840,656,266 in total from 15 business entities, including Sungwond Co., Ltd., and received all of the gold bullion on the date of entry, and received 160 copies of tax invoice under the instant transaction from the supplier, and received 160 copies of tax invoice from the supplier, respectively, within the day or short period after receiving the gold bullion on the date of purchase of the instant gold bullion. The Plaintiff is aware of the fact that the Plaintiff exported the instant gold bullion to the domestic wholesale company or supplied the gold bullion with considerable profits in the process. Examining this fact in light of the aforementioned legal principles, the Plaintiff cannot be seen as having prepared a tax invoice for the instant gold bullion or exempted from the supply of the instant gold bullion solely on the grounds that the instant gold bullion was not subject to the supply of the said gold bullion, and there was no other tax invoice or exempted from the supply of the said gold bullion.

In regard to this, the defendant argued that the transaction in this case was committed by the plaintiff in order to illegally get off the value-added tax evaded by the wide carbon company, and thus, the input tax deduction should be denied, and since the transaction in this case as an act of carrying out such intent is null and void in violation of Article 103 of the Civil Code, the tax invoice in this case received as a result of the transaction shall be deemed to be "the transaction different from the fact", and the application of the zero-rate tax system should be excluded in case where the plaintiff abused the zero-rate tax system for the purpose of illegally acquiring taxes of countries other than the national government. However, the evidence submitted by the defendant alone is insufficient to recognize that the transaction in this case was performed only for the purpose of refund of value-added tax by abusing the zero-rate tax system

3. Conclusion

Therefore, the disposition of this case on a different premise as above is unlawful as it does not examine the plaintiff's other arguments. Thus, the judgment of the court of first instance is different from this conclusion, and it is so decided as per Disposition by cancelling the disposition of this case.