After the commencement of rehabilitation procedures, the oligopolistic shareholder does not constitute an oligopolistic shareholder and does not constitute an oligopolistic shareholder.

In order to fall under the secondary tax liability of a corporation, the oligopolistic shareholder is one of the oligopolistic shareholders, but the decision of commencement of rehabilitation does not fall under the oligopolistic shareholder because it does not actually exercise the rights or control over the shares, so the designation of the secondary tax liability of a corporation is illegal. The designation of the secondary tax liability of a corporation is illegal and illegal

2013Guhap21074 Revocation of Disposition of Imposing capital gains tax

00

00

May 20, 2014

June 3, 2014

1. Of the instant lawsuit, the part of the claim for revocation of the disposition imposing additional dues of KRW 00 shall be dismissed.

2. On February 1, 2013, the Defendant’s disposition of imposition of capital gains tax of 000 won on February 1, 2013, which belongs to a rehabilitation debtor 000 stock company, shall be revoked.

3. One-fourth of the costs of lawsuit shall be borne by the Plaintiff, and the remainder by the Defendant, respectively.

The Defendant’s disposition of imposition of KRW 000 of the transfer income tax for the year 2007, which was made on February 1, 2013 by the Defendant on February 1, 2013, was revoked (the Plaintiff stated in the claim that “the rehabilitation debtor corporation was 000” as “the Plaintiff, but this appears to be a clerical error).

1. Details of the disposition;

A. The rehabilitation debtor, 000 corporation (hereinafter referred to as the "Z industry") is a corporation that engages in the manufacturing of metal at the 00th 00 group of 00. The rehabilitation debtor was decided to grant authorization for the rehabilitation plan on December 18, 2008 after receiving a decision to commence rehabilitation procedures at the 000 group of 000 group of this court.

B. YY, around March 2007, became an oligopolistic shareholder who owns 50% of the shares of 000 (bbb is owned by 25% of the shares). However, Aa was in arrears with the capital gains tax for the year 2007 in which the Defendant notified on December 31, 2010 as the due date for payment.

C. The Defendant seized 00 shares owned by Aa on May 16, 201 and requested a public auction to the Korea Asset Management Corporation on June 28, 2012. However, on October 23, 2012, the Korea Asset Management Corporation notified the Defendant of the impossibility of public auction on the grounds that the ownership transfer of shares is inappropriate and the disposition fee for arrears is excessive, etc., and requested the cancellation of the public auction by proxy.

D. On December 4, 2012, the Defendant, as an oligopolistic shareholder of 000 aa, designated 00 as a secondary taxpayer on the ground that aa satisfies the requirements of Article 40(1) of the former Framework Act on National Taxes (amended by Act No. 11124, Dec. 31, 2011; hereinafter the same) and imposed a disposition to impose aa capital gains tax equivalent to 50% of the shares of Aaa out of the delinquent amount of Aaa in the amount of delinquent local taxes at 00.

E. On January 7, 2013, the Plaintiff filed an objection, but the Defendant dismissed the objection on January 25, 2013.

F. On February 1, 2013, the Defendant corrected the amount designated as the secondary taxpayer on February 1, 2013, and then set the payment period of 000 to February 21, 2013, and imposed capital gains tax of 000 won (i.e., principal tax of 00 won + additional tax of 000 won) (hereinafter “instant disposition of imposition of capital gains tax of 00 won”).

G. On April 29, 2013, the Plaintiff filed an appeal seeking the revocation of the instant disposition with the Tax Tribunal, but the appeal was dismissed on September 5, 2013.

[Ground of recognition] Unsatisfy, Gap evidence 1 to 5 (including each number in case of additional number), Eul evidence 1 and 2, the purport of the whole pleadings

2. Whether the part concerning the claim for revocation of the disposition imposing additional dues in the instant lawsuit is legitimate

Ex officio, we examine whether the part concerning the claim for revocation of the disposition imposing additional dues is legitimate.

Additional dues provided for in Articles 21 and 22 of the former National Tax Collection Act (amended by Act No. 10527, Apr. 4, 2011; hereinafter the same shall apply) are naturally arising under the provisions of a law and the amount thereof is determined unless national taxes are paid by the due date. If initial amount of tax imposed is revoked or revised, additional dues are automatically revoked or reduced in response thereto. Thus, the notice of additional dues cannot be deemed a disposition subject to appeal litigation (see, e.g., Supreme Court Decision 2000Du2013, Sept. 22, 2000).

Therefore, even if the Defendant, as seen earlier, together with the principal tax of capital gains tax of KRW 000, written a notice of payment along with the additional 000, this is merely a notice of concept informing the existence of the additional dues, and it cannot be deemed a disposition subject to appeal litigation. Therefore, the part of the claim for revocation of the disposition of imposition of additional 000 won

3. Whether the instant disposition is lawful

A. The plaintiff's assertion

The instant disposition is unlawful for the following reasons.

1) Aa does not have the status of oligopolistic shareholders who can substantially operate the Z industry after the decision on commencing the rehabilitation procedure is rendered. Therefore, Article 40 of the former Framework Act on National Taxes, which imposes secondary tax liability on a corporation by deeming oligopolistic shareholders as possessing corporate property by practically controlling the operation of a corporation, should be deemed not to apply after the decision on commencing the rehabilitation procedure.

2) Article 179(1)9 of the Debtor Rehabilitation and Bankruptcy Act (hereinafter “ Debtor Rehabilitation Act”) recognizes, in cases of taxes having the nature of tax or indirect tax withheld and specially collected, only when the deadline for payment has not yet expired at the time rehabilitation procedures commence. Capital gains tax is not a taxation claim recognized as a priority claim under the Debtor Rehabilitation Act, and thus, should be reported to the second meeting of interested persons, just as a general rehabilitation claim, even if the second meeting of interested persons is not reported. However, as the Defendant did not file a report, it cannot be exercised.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Whether it constitutes an oligopolistic stockholder

A) Article 40 of the former Framework Act on National Taxes imposes secondary tax liability on the relevant corporation only in cases where a tax office intends to sell stocks, etc. owned by oligopolistic stockholders by an oligopolistic stockholder by re-auction or private contract with respect to a default of national taxes by an oligopolistic stockholder as of the expiration date of the payment period of national taxes. The purport of the provision is to stipulate secondary tax liability for a corporation, in a formal manner, even though the property is attributed to a third-party corporation, in substance, if it is recognized that the property is attributed to an oligopolistic stockholder, who is the original taxpayer, and thus is not fair even if it is recognized that the property is attributed to the oligopolistic stockholder, it would be necessary to deny the title of formal rights and to make a supplementary tax liability for the corporation to which the formal right belongs, thereby promoting the rationalization of tax equity and collection procedures. In this regard, the above provision is not different from the purport of Article 39 of

Therefore, under Article 39 of the former Framework Act on National Taxes, a person who has a special relationship, such as a shareholder or one partner with limited liability and his/her relatives, and whose total amount of stocks held or investments exceeds 50/100 of the total number of outstanding stocks or investments of the pertinent corporation, and who actually exercises the rights to the stocks or actually controls the management of the corporation (see, e.g., Supreme Court Decisions 89Nu1414, Apr. 13, 1990; 93Hun-Ba49, 93Hun-Ba38 and 41, 95Hun-Ba64, Jun. 26, 197).

However, when a decision has been made to commence rehabilitation procedures under the Debtor Rehabilitation Act, the right to manage and dispose of the company’s business and the property shall be exclusively vested in the custodian; and the custodian is a kind of public trustee, who is the manager of the organization of interested parties, which is neither the organization nor the representative of the rehabilitation company nor the creditor and the shareholder, can exercise his/her right, such as the representative of the rehabilitation company, the performance of business, and the management of property, so the oligopolistic shareholder is unable to exercise his/her shareholder’s right as a major shareholder, and at that time does not meet the requirements for oligopolistic shareholder (see, e.g., Supreme Court Decision 8

B) We examine the above facts of recognition in accordance with such legal principles.

00 as of December 18, 2008, the rehabilitation procedure commenced upon the commencement of the rehabilitation procedure upon the commencement of the rehabilitation procedure by this Court No. 2008hap15, the administrator shall be deemed to exercise the power, such as the representative of 000, the performance of duties, and the management of property, from the standpoint of a public trustee, who is a kind of official trustee. Therefore, even if AA was in default of the capital gains tax for the year 2007, which is the national tax, designated on December 31, 2010 due to the payment period, it shall not be deemed as an oligopolistic shareholder who actually exercises the rights to stocks at that time or actually controls the management of the corporation, and accordingly, ZZ industry does not bear the secondary tax liability for the capital

Therefore, the disposition of this case under the premise that AA is an oligopolistic stockholder is unlawful, and the plaintiff's above assertion pointing this out is with merit.

2) Whether the case constitutes a priority claim

A) In order for the secondary tax liability to be established, facts that meet the requirements for the primary taxpayer’s default, etc. As such, the period of establishment is at least after the payment deadline for the primary tax liability expires (see, e.g., Supreme Court Decision 2003Du13083, Apr. 15, 2005).

Even if the secondary tax liability of the Z industry is established due to the arrears of the AA, it constitutes a tax claim that was established after the commencement of rehabilitation procedures, at least after the Defendant notified the AA as the principal taxpayer on December 31, 2010. However, the transfer income tax imposed on the instant disposition, pursuant to Article 40 of the former Framework Act on National Taxes, is obliged to bear the delinquent tax amount of the AA, which is an oligopolistic shareholder, to the relevant corporation, and is accordingly irrelevant to the management and disposal of the inherent business and property.

Therefore, the above transfer income tax is a priority claim under Article 179(1)2 of the Debtor Rehabilitation Act, and it cannot be deemed that it constitutes a claim for expenses for the debtor’s business and the management and disposal of property after the commencement of rehabilitation procedures. Furthermore, since Article 179(1)9 of the Debtor Rehabilitation Act and Article 179(1)9 of the same Act cannot be deemed as a priority claim, it shall be deemed as falling under other claims after commencement of rehabilitation procedures

Unlike public-interest claims that can be repaid from time to time without resorting to rehabilitation procedures prior to rehabilitation claims, the act of repayment, receiving repayment or extinguishing repayment (excluding exemption) shall not be performed from the time rehabilitation procedures commence to the time when the repayment period provided for in the rehabilitation plan expires (referring to the time when the rehabilitation procedures are completed where the rehabilitation procedures are completed before it is decided to grant authorization for the rehabilitation plan; and the time when the repayment is completed where repayment based on the rehabilitation plan is completed before the rehabilitation procedures are completed) (excluding exemption).

B) Meanwhile, the provisions on a tax payment notice under Article 9 of the former National Tax Collection Act or an individual tax-related Act that demanded a tax payment notice to specify a taxable year, tax item, tax amount, grounds for calculation, payment deadline, place of payment, etc. does not merely provide a decoration for the convenience of tax administration, but rather provides a fair tax administration by excluding the person of the tax authority, careful and reasonable taxation, and by allowing the taxpayer to impose a tax disposition in accordance with the principle of no taxation without representation, and by giving the taxpayer a detailed notice of the details of the disposition, and by allowing the taxpayer to make a decision on whether to object of the disposition and for convenience of appeal (see, e.g., Supreme Court Decision 88Nu7996, Nov. 10, 19

However, as seen earlier, the Defendant: (a) designated the Z industry as the secondary taxpayer for the overdue tax amount of Y; (b) determined the due date for payment by February 21, 2013; and (c) issued the instant disposition.

In light of the characteristics of other claims after the deadline during which repayment is made, repayment is made, and other acts of extinguishing claims cannot be performed while the rehabilitation plan is in progress, it is reasonable to view that the above payment deadline has no effect on the duty payment notice.

Therefore, the instant disposition constitutes unlawful since it constitutes a case where the payment deadline was not stated in a tax payment notice in violation of the former National Tax Collection Act or the provisions on the tax payment notice of individual tax-related Acts.

4. Conclusion

Therefore, the part of the claim for revocation of the disposition of imposition of additional 000 won in the lawsuit of this case is unlawful and dismissed, and the claim for revocation of the disposition of this case is justified and it is so decided as per Disposition.