(a) Whether the aggregate trial balance sheet alone can be used as the basis for calculating the taxable income of the corporation;

B. The estimation method under Article 33(4) of the former Corporate Tax Act (amended by Act No. 3200 of Dec. 28, 1979) and Article 93(2) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 9699 of Dec. 31, 1979) and the significance of the estimation method under Article 93(2) of the same Enforcement Decree

(c) the burden of proving whether the method of estimated taxation is illegal;

(d) Whether or not there is a non-existence of the salary of the representative who is the necessary expenses.

E. Definition of “representative” under Article 94(3) of the Enforcement Decree of the Corporate Tax Act

A. The amount of income under the Corporate Tax Act refers to the amount obtained by deducting the total amount of deductible expenses from the total amount of gross income which belongs or comes to the business year in accordance with Article 9(1) of the same Act, and where the commercial books, etc. are legally calculated under commercial law, only the difference between the amount of the current settlement of accounts (or deficit) of the company's appropriation and the profits and expenses arising from the adjustment and regulation of addition or reduction of the amount of corporate tax in accordance with the provisions of tax law shall be the taxable income of corporate tax. However, where the commercial books, etc. are not lawfully calculated, the amount shall be the basis of corporate income calculation after the correction of the commercial calculation (in this case, the tax adjustment, including the correction of the commercial calculation, may be referred to as the tax adjustment) if so, the total balance sheet alone cannot be used as the basis of corporate taxable income calculation.

B. According to Article 33(4) of the former Corporate Tax Act (amended by Act No. 3200 of Dec. 28, 1979) and Article 93(2) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 9699 of Dec. 31, 1979), the method of estimating the amount of income is the method of calculating the amount of business revenue by multiplying the amount of business revenue by the standard income rate, the partner rate, or the former taxable period's own income rate, and such method of estimating the amount of business revenue can be applied where the amount of business revenue is proved. According to Article 93-2 of the Enforcement Decree of the same Act, it is clear that the method of estimating the amount of business revenue is the method of calculating the amount of business revenue in accordance with the method of calculating the amount of business revenue in accordance with the method of calculating the amount of business revenue.

(c) When the reasonableness of estimation has been proved by the tax authorities, there is a need for the taxpayer to prove that there is a further estimation method close to the facts.

D. The representative's pay is the necessary expenses of the pertinent corporation, barring special circumstances. The burden of proof of the tax base, which is the basis of taxation in a lawsuit seeking revocation of the disposition of revocation of the income tax or corporate tax, is imposed on the tax authority, and the tax base is deducted from necessary expenses. Thus, the burden of proof of income and necessary expenses is imposed on the tax authority. However, considering that the taxpayer is favorable to the taxpayer, and most of the facts causing necessary expenses are located in the area under the control of the taxpayer and the burden of proof is easy, it is reasonable to presume the absence of the necessary expenses for which the taxpayer does not perform the duty of proof. It is also consistent with the concept of fairness to recognize the necessity of proof to the taxpayer by allowing such presumption of absence.

E. The representative under Article 94(3) of the former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 9699 of Dec. 31, 1979) shall be the de facto representative operating the company, and even if the representative was registered on the corporate register of the company, if the company had not been actually operating, it shall be deemed that such recognized income is not subject to the comprehensive income tax because it reverts to such representative.

A. Article 9(b) of the Corporate Tax Act (amended by Act No. 3200 of Dec. 28, 1979); Article 33(4) of the former Corporate Tax Act; Article 93(1)1 and 93(2)1(c) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 9699 of Dec. 31, 1979); Article 26(3) of the former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 9699 of Dec. 31, 1979)

[Judgment of the court below]

Head of Seodaemun Tax Office

Seoul High Court Decision 84Gu429 delivered on January 20, 1986

The appeal is dismissed.

The costs of appeal shall be borne by the plaintiff.

As to the grounds of appeal and supplementary appeal related thereto

(1) The balance sheet is an interim adjustment sheet to verify whether the transaction details were set to the president in the double entry system in accordance with the corporate accounting practices, which is the basis of the balance sheet and profit and loss statement preparation, but is based on the balance sheet or profit and loss statement preparation, which is one of the financial statements, even though it is based on the commercial accounting standards under Article 29(2) of the Commercial Act, the amount of income under the Corporate Tax Act, even though it should be respected pursuant to the main sentence of Article 20 of the Framework Act on National Taxes, refers to the amount obtained by deducting the total amount of deductible income from the total amount of taxable income which belongs or comes to the business year under Article 9(1) of the same Act or which comes to belong to the business year, and in the case of a correction of the balance sheet and income statement, it is clear that the balance between the profits and expenses under the corporate tax law should be legally calculated by making the correction of the balance between the profits and expenses under the corporate tax law (excluding those under this Act) and the tax adjustment after the correction of the profits and expenses under the same Act.

According to the court below's duly established decision in this case, the non-party Yangyang Industries Co., Ltd. (hereinafter "the Namyang Industries Co., Ltd.") failed to report the tax base and tax amount of corporate tax on business income in 1979 and submitted only the total balance sheet as of September 30, 1979 when it engaged in business activities without submitting the statement of accounts, books and other documentary evidence requested by the head of the competent tax office. Thus, the bank, etc. of the Namyangsan Co., Ltd. conducted business activities at the same tax office after investigating the bank, etc. of the said tax office only found that the sales amount in the above Simsan Co., Ltd. was reliable, and there was no other method of investigating the actual income amount of the Namyangsan Co., Ltd..., Ltd..., such case should be deemed to constitute grounds for estimating Article 93 (1) 1 of the Enforcement Decree of the Corporate Tax Act prior to the amendment by Act No. 3200 of Dec. 28, 1979.

It is proper that the court below affirmed the necessity of the preliminary investigation in this case, and there is no illegality such as the theory of the lawsuit, and the precedent of the lawsuit cannot be appropriate in this case.

(2) On the basis of the method of the estimated survey used by the chief of the competent tax office to calculate the amount of income in the year 1979, the following parts are to be inferred.

In other words, South and North Korea filed a voluntary declaration of corporate tax with the superior corporation until 1978, which was operated in the business of manufacturing, exporting, processing, and exporting leather products and domestic sales. Since the financial standing of the 1979 was 9.30 days after the aggravation of the financial standing and the full-time suspension of business until the end of the year, the tax base and tax amount of corporate tax for the 1979 year at the competent tax office is estimated at the above tax office in calculating the tax base and tax amount of corporate tax for the 1979 year from January 1, 1979 to September 30, 1979 as mentioned above, it was recognized that the export and domestic sales in the remaining 1979 year from January 1, 1979 to September 30, 1979 as revenue amount, but it was not possible to apply the prescribed income-standard ratio of the National Tax Service to the remaining 1979 year's revenue amount and domestic sales revenue amount of the 1979 year's total export revenue amount of the 1979 year's revenue amount of the inventory and inventory products.

(1) Under Article 33(4) of the Corporate Tax Act and Article 93(2) of the Enforcement Decree of the same Act, the method of estimation is the method of calculating the amount of income by multiplying the amount of business revenue by the standard income rate, the partner rate, or the income rate of the person in the immediately preceding taxable period. This method of estimation is the method of calculating the amount of business revenue in accordance with the method of estimation under Article 93-2 of the Enforcement Decree of the same Act, which is the method of calculating the amount of business revenue in accordance with the method of estimation, which is the method of calculating the amount of business revenue in accordance with the method of partner authority, business efficiency, the number of production, the cost per unit input, the ratio of cost per unit input, the ratio of sales revenue, the ratio of

Therefore, in this case, recognizing the sales on the remaining remaining balance sheet of the Namyang as genuine result of the investigation and using the method of calculating the amount of income by means of multiplying the standard income rate shall be in accordance with Article 93 (2) of the Enforcement Decree of the Corporate Tax Act as above. The above sales amount shall be the total amount of household and leather, and the above sales amount shall be divided in proportion to sales amount according to the ratio of possession of stock in the previous year in order to classify the ratio of sales of household and leather exports or inland waters, and the classification and application of the standard income rate shall not be reasonable under the above paragraph where it is not possible to find any clear method otherwise.

The reason is that the system of estimated taxation can not be grasped because there is no sufficient evidence, so it is a system satisfied and taxed by the grasping of the actual amount of taxation by exceptionally probability, so it is inevitable to take into account that the difference is expected to occur inevitably, the above method chosen by the head of the competent tax office is considered to be a method close to the fact at the present time.

As such, it is reasonable to view that the taxpayer needs to prove the existence of a method of estimation close to the fact when the reasonableness of estimation has been proved by the tax authorities, and in this case, the court below's decision that the method of estimation as mentioned above is correct, and there is no error of law such as the theory of lawsuit.

The theory of lawsuit argues that the business revenue recognition by the head of the competent tax office had been based on the estimation method under the provisions of Article 93-2 of the Enforcement Decree of the Corporate Tax Act as seen above, but the above recognition of the revenue amount is not based on estimation method, but by objective evidence, and that this is not contrary to the provisions of the above Acts and subordinate statutes.

In addition, when determining the tax base of corporate tax based on the estimation investigation, the theory of lawsuit, in principle, should be the business revenue amount of the corporation multiplied by the standard income rate of the corporation and the amount after deducting the salary paid by the corporation to the representative as the corporate tax base, notwithstanding the fact that the representative salary is not deducted, and even though it is easy to conduct a field investigation, it is argued that the head of the competent tax office does not have to investigate it and do not have to do so. Article 33(4) of the Corporate Tax Act and Article 93(2)1 of the Enforcement Decree of the Corporate Tax Act

However, it is evident in the records of this case that it was impossible to find evidence to prove the representative salary in South and North Korea despite efforts to verify it. The original salary of the representative is the necessary expenses of the relevant corporation unless there are special circumstances. The tax base of the tax base, which is the basis of taxation in the lawsuit to revoke the disposition of revocation of the income tax or corporate tax, is the tax authority, and the tax base is deducted from the revenue, so the tax office has the burden of proving the income and necessary expenses is the tax authority, but the necessary expenses are favorable to the taxpayer, and most of the facts causing the necessary expenses are within the area under the control of the taxpayer and it is easy to prove them. Considering that the fact that the taxpayer is within the area under the control of the taxpayer, it is difficult to prove the absence of necessary expenses. In addition, considering that it is difficult to prove the necessary expenses from the perspective of the tax authority, it is also consistent with the concept of fairness to recognize the necessity of proof to the taxpayer by allowing the presumption of absence.

Of course, since the tax authority's difficulty of proof is different depending on the case where it is difficult to prove, it is reasonable to uniformly recognize the necessity of proof to the taxpayer even when it is difficult to prove, in light of the principle that the burden of proof on necessary expenses is against the tax authority, but in this case, the salary of the representative director is necessary to actively prove the taxpayer. Thus, the plaintiff's attorney who does not prove it even the court below's trial as a fact-finding court's attorney cannot be subject to new criticism in the party members who are the legal judge

(3) According to Article 33(5) and (4) of the Corporate Tax Act as seen above, the difference between the income amount determined by estimation and the net income amount on the corporate balance sheet is subject to the disposition of income. According to Articles 94(3) and (4) and 93(4) of the Enforcement Decree of the Corporate Tax Act, the amount subject to the disposition of income should, in principle, be the bonus to the representative. However, in a case where the account book and other documentary evidence are destroyed by natural disasters or other force majeure and the tax base is determined by the method of the disposition of property rights, the amount

According to the reasoning of the court below, the court below determined that the above amount of net income on the balance sheet is legitimate since there is no book such as the balance sheet in South and North Korea, and there is no evidence that the remaining amount of net income on the balance sheet is subject to disposal, and since the account books and other documentary evidence are destroyed by force majeure, the disposition by the head of the competent tax office which has taken the above amount as a bonus shall be deemed legitimate. Thus, the court below's reasoning that the above theory criticizes that the remaining amount of bonus should not be examined as to the existence of net income on the business year 1979 of South and North Korea, and that the above aggregate balance sheet (this sheet shall be deemed as advance payment cost account, and it shall be deemed that the settlement of accounts was completed at the end of the period of the business year, and it shall not be deemed that the remaining amount of 180,442,012, which is no more than the above 1979, and it shall not be deemed that there was an unlawful net profit on the remaining amount of 1363,36969, etc.

In addition, in full view of the provisions of Article 21 (1) (c) of the Income Tax Act, which was effective at the time of the occurrence of the taxation requirement of this case, Article 94 (3) of the Enforcement Decree of the Corporate Tax Act as seen above, the representative under Article 94 (3) of the Enforcement Decree of the Corporate Tax Act shall be the actual operator of the company, and even if the company was registered on the corporate register as the representative director of the company, such recognized income shall not be levied on the representative unless the company was actually operated. Thus, the court below's decision that the remaining Yangsan only carried on the business from January 1, 1979 to September 30, 1979 and was in a state of suspension without conducting the business activity after the end of the business year, and the income tax base of the remaining Yangsan in the business year under the above estimation was generated during the period of business activity, so it is reasonable that the representative director of the above 273-day representative director, who served on the plaintiff et al., for the period of service of the plaintiff 197 days.

Therefore, this appeal is dismissed as it is without merit. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Byung-hee (Presiding Justice)