Changwon District Court 2014Guhap760 ( October 26, 2015)

It is reasonable that the plaintiffs were imposed by deeming them as joint business operators of the business.

(1) In full view of the facts that the plaintiffs and the non-party acknowledged that they entered into a partnership business agreement with respect to the business of the workplace of this case and that they asserted that they had a partnership business relationship in the related lawsuit, it is reasonable to deem that the plaintiffs constitute joint business operators of the workplace of this case who actually belong to the profits of this case.

Article 14 of the Framework Act on National Taxes

2015Nu1129 Revocation of Disposition of Imposition of Value-Added Tax, etc.

AA

○ Head of tax office

Busan District Court Decision 2014Guhap760 Decided May 26, 2015

May 11, 2016

June 1, 2016

1. The plaintiff's appeal is dismissed.

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

Cheong-gu Office

The judgment of the first instance shall be revoked. The defendant's addition to the attached Table 1 as to the plaintiff on February 1, 2013 shall be as stated in the attached Table 1.

Each imposition disposition (including each additional tax) of value tax, global income tax, and special consumption tax shall be revoked.

1. Details of the disposition;

A. BB: from June 10, 2005 to August 20, 2012, ○○○-dong 99-4 ○○○○, ○○-si, from June 10, 2005

An entertainment drinking house (hereinafter referred to as the “instant place of business”) with the trade name of “○○○○○” on the first floor of the tele-building.

from June 10, 2005 to June 30, 2008, the name of DD, from July 1, 2008, to June 1, 2008

Until August 20, 2012, the business registration of the instant workplace was made in the EE name.

B. As a result of conducting a tax investigation on the instant workplace from April 12, 2012, the ○○ regional tax office: (a) identified that the actual business entity of the instant workplace was BB; (b) the revenue omitted between January 1, 2006 and December 31, 2009 by BB was ○○○○○○○○○, and notified the Defendant of the foregoing taxation data; (b) on July 5, 2012, the Defendant corrected and notified the ○○○○○, including the value-added tax, the special consumption tax (including the education tax; hereinafter the same shall apply) and the global income tax, to the Defendant.

C. BB “from June 14, 2006 to September 30, 2007” on October 4, 2012, 2012, the Plaintiff and the joint members of the first instance court.

The High CCC (hereinafter referred to as “CCC”) filed an objection to demand re-issuance of the global income tax for the year 2006 and the global income tax for the year 2007, claiming that the instant place of business was operated jointly with the High CCC. On October 24, 2012, the Director of the Regional Tax Office rendered a re-audit to the effect that “BB and the Plaintiff and the CCC re-audited the amount of income distributed to BB and the Plaintiff and the CCC for each of the operating periods and subsequently corrected their tax base and tax amount according to the results of re-audit.” As a result of the re-audit from November 7, 2012 to November 21, 2012, BB and the Plaintiff and CCC jointly operated the instant place of business [from June 14, 2006 to January 14, 2007, BB and CCC notified Plaintiff 30% and B05% of the Plaintiff’s income distribution ratio and C230% of the Plaintiff B and CCC (2305% of the Plaintiff 307.

D. Accordingly, on February 1, 2013, as indicated in the corresponding column of attached Table 1, the Defendant issued a revised and notified the Plaintiff on February 1, 2006 of the value-added tax amounting to ○○○○○○○ (in the case of an amount including an additional tax, value-added tax, global income tax, and special consumption tax, including an amount including an additional tax), the value-added tax amount for the second term of 2006, 2006, ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○ in the special consumption tax for the year 2007, and 2007 (hereinafter collectively referred to as the “instant disposition”).

E. On August 28, 2013, the Plaintiff filed an objection against the instant disposition, and filed an appeal with the Tax Tribunal, but the said appeal was dismissed on December 30, 2013.

Facts that there is no dispute over recognition, Gap 1, 3 evidence, Eul 1, 3, 4, 8, 9 each statement (including a serial number; hereinafter the same shall apply), the purport of the whole pleadings.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) Since the remaining disposition, excluding the disposition imposing global income tax for the year 2007, was made after five years have elapsed from the exclusion period of imposition, it is unlawful.

2) The Plaintiff agreed to receive business allowances from BB for the Plaintiff’s sales performance of alcoholic beverages and agreed to receive business allowances, and did not engage in BB and the instant place of business as a joint business.

3) The Defendant adopted the judgment of civil action between the Plaintiff and BB (the Changwon District Court Decision 2007Gahap8716, etc.) and the business day voluntarily prepared by BB as taxation data without any verification, and thus, is contrary to the underlying taxation principle.

4) Even if the Plaintiff is liable for tax payment, the Plaintiff thought that the Plaintiff was his employee and the tax of the instant workplace was responsible for BB, and there is a justifiable reason that the Plaintiff could not be responsible for the Plaintiff’s breach of the duty to report and pay taxes, and thus, each of the disposition of this case’s imposition of penalty taxes is unlawful.

5) On December 2012, 2012, the Plaintiff denied the partnership business relationship with BB and demanded a survey by the ○○ Regional Tax Office, but the ○○ Regional Tax Office did not accept it and give the Plaintiff specific opportunity to explain. Therefore, the instant tax investigation is unlawful as it infringes on the procedural right of the Plaintiff to state its opinion under Article 81-5 of the former Framework Act on National Taxes.

B. Relevant statutes

Attached Form 2 shall be as listed in attached Table 2.

(c) Fact of recognition;

1) On December 7, 2007, the Plaintiff filed a lawsuit against BB seeking the payment of embezzlement, etc. (the Changwon District Court 2007Gahap8716). However, on January 6, 2011, the Plaintiff was sentenced to a dismissal ruling from the above court, and the judgment of the first instance became final and conclusive on the grounds that both the appellate court and the final appeal have lost, and the facts recognized in the above lawsuit (hereinafter referred to as “the pertinent lawsuit”) are as follows.

2) On June 13, 2011, BB filed a lawsuit against the Plaintiff seeking the payment of embezzlement ( Changwon District Court 201Gahap5141). However, on June 21, 2012, BB received a ruling of dismissal from the above court, and the said judgment of the first instance court became final and conclusive even in the appellate court against the Plaintiff, and the facts recognized in the said lawsuit (hereinafter referred to as “related lawsuit 2”) are as follows.

3) Meanwhile, from the end of December 2007 to the beginning of January 2008, the Plaintiff and BB filed a complaint with each other on the charge of embezzlement, etc. (hereinafter “related criminal case”), and the Plaintiff and BB made a statement to the following purport in the course of the investigation.

Facts that there is no dispute over recognition, entry in Gap-5, 8, 9, Eul-5, and 7, and the whole pleading;

chapter 6

D. Determination

1) Whether the exclusion period is expired

A) Article 26-2(1) of the former Framework Act on National Taxes (amended by Act No. 911, Jan. 1, 2010; hereinafter the same) provides for the exclusion period for national taxes; Article 26-2(1) of the Enforcement Decree of the Framework Act on National Taxes provides that when a taxpayer evades, is refunded, or is deducted from, a national tax by fraud or other unlawful means, it shall be for ten years from the date on which the national tax is assessable ( Subparagraph 1); where a taxpayer fails to file a tax base return within the statutory due date of return, for seven years from the date on which the national tax is assessable (subparagraph 2), and for five years from the date on which the national tax is assessable (subparagraph 3) if the taxpayer does not fall under any of subparagraphs 1 and 2; and Article 12-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes provides that in cases of a national tax, the

B) The Plaintiff asserts that the exclusion period of imposition of the remaining tax disposition, excluding the imposition of global income tax for the year 2007, among the instant disposition, is five years. However, in the case of a joint business proprietor, the return of tax base shall be filed as a joint business proprietor. According to the facts of recognition of the above 1.06, BB appears to have filed a return of tax base in the EE name as a personal entrepreneur with respect to the global income tax for the first period, second period, value-added tax for the second period, 2006, special consumption tax for the year 2007, and global income tax for the year 2006. Since BB, Plaintiff, and CCC did not have filed a return of tax base indicating that BB is a joint business proprietor at the instant business establishment, the Plaintiff cannot be deemed to have filed a return of tax base as the taxpayer.

Therefore, the exclusion period of imposition is seven years in the case of the remaining disposition, excluding the disposition imposing global income tax for the year 2007, among the disposition in this case. Thus, it is obvious that the remaining disposition in February 1, 2013 has not elapsed seven years of exclusion period of imposition. Thus, the plaintiff's assertion in this part is without merit.

C) The Plaintiff asserts that he is exempted from the duty to make a final return, or that BB made a tax return by himself as a person having only his earned income, the Plaintiff is also deemed to have filed a tax return. However, as seen thereafter, the Plaintiff is a person having business income, not an earned income, and thus, does not constitute a case of exemption from the duty to make a final return. The limitation period of the instant disposition against the Plaintiff should be determined separately from that of BB. However, there is no legal basis that BB could treat the same as that of the Plaintiff’s report. Therefore, this part of the Plaintiff’s assertion is without merit.

2) Whether the substance over form principle is violated

Considering the following circumstances, it is reasonable to view that the Plaintiff’s business proprietor as a joint business proprietor of the instant business establishment constituted “a person to whom the profit actually belongs” and the testimony of FF witness of the first instance trial alone is insufficient to reverse the recognition. Thus, the Plaintiff’s assertion that the instant disposition violates the principle of substantial taxation is without merit.

① The facts acknowledged in the final judgment of other cases related thereto in the administrative judgment are the flexible evidence, barring special circumstances where it is deemed difficult to adopt a factual judgment in the final judgment of the relevant case in light of other evidence submitted in the relevant administrative judgment (see Supreme Court Decision 9Da41657, Jun. 11, 2002). As seen earlier, “the fact that the Plaintiff, CCC, and BB entered into a partnership agreement with the instant workplace on June 14, 2006” is recognized.

② From the first instance court to the final appeal, the Plaintiff asserted the existence of a trade relationship with BB by itself, and made a statement in the relevant criminal case to the same effect.

3. BB made a detailed statement on the process of investigation into the relevant criminal case with the Plaintiff and CCC on the developments leading to the partnership business agreement, the period of the partnership business and the ratio of profit distribution, etc., and the contents of the agreement are consistent with the Plaintiff’s statement on the partnership business.

④ The Plaintiff asserted that BB took exclusive charge of investment in the facilities of the instant workplace, including the burden of lease cost and the discount, and that it is merely a mere employment of BB as a business warehouse without any such investment. However, since the establishment of a business agreement does not necessarily require any investment in money or other property, it is reasonable to deem that the Plaintiff agreed to operate a joint business with BB by investing in the business of the instant workplace and the sales proceeds of liquor.

⑤ The Plaintiff appears to have been actually involved in the operation of the instant workplace, including GG, HH, and III, at the instant workplace.

6. Even if the Plaintiff was unable to properly distribute the income accrued from the agreement ratio from BB, such circumstance is merely a matter of non-performance of contractual obligation between the Plaintiff and BB.

7. The precedents cited by the Plaintiff are to determine whether a worker is a worker under the Labor Standards Act based on the actual labor relations between the parties, and thus, are different from the instant case that constitutes joint business operators, and thus, cannot be invoked in the instant case.

3) Whether the underlying taxation violates the principle of taxation

In light of the following circumstances, the above evidence Nos. 6 and 10 and the overall purport of the arguments, it cannot be said that there was an error of law, such as violation of the principle of taxation based on the disposition of this case, which takes the contents of the judgment in the lawsuit No. 1 and the business day prepared by BB as taxation materials, and thus, the plaintiff's assertion on this part is without merit.

① The facts of 'BB' and 'CCC agreement' recognized in the first-related lawsuit are not only recognized as facts of no dispute between the parties in the second-related lawsuit, but also supported by the BB in the related criminal case and the plaintiff's specific statements.

② On June 14, 2006 through October 13, 2007, the total cash sales, credit card sales, etc. at the instant place of business are specifically indicated on each day. On the basis of the settlement details from June 14, 2006 to October 13, 2007, each of the earnings distributed to BB, Plaintiff B, Plaintiff, and CCC according to the operating period is specified, and the distribution ratio is consistent with the facts recognized in the first-related lawsuit.

③ BB does not recognize the partnership relationship with the Plaintiff and CCC, even though ○○○○○○○○, which was corrected and notified on July 5, 2012, could have entirely borne by the Defendant, it is recognized that ○○○○○○○, which was confirmed based on the business log prepared by BB by the ○○ Regional Tax Office, itself as to the omitted amount of reporting ○○○○○○.

④ Although the Plaintiff asserts that the monthly sales amount on the business day prepared by BB is inconsistent with the monthly sales amount calculated by the Defendant, the Plaintiff is confirmed to coincide with the sum of the amounts.

(B) The Plaintiff appears to have asserted as above on the business day from July 14, 2006 to August 13, 2006, which was not bound in the order of the business day from July 14, 2006 to August 13, 2006 and was attached to the last.

4) Whether the imposition of additional tax is unlawful

A) In order to facilitate the exercise of taxation rights and the realization of tax claims, additional tax under tax law is an administrative sanction imposed as prescribed by the Act in cases where a taxpayer violates various obligations, such as a tax return and tax payment, without justifiable grounds, and the taxpayer’s intentional or negligent negligence is not considered. However, such a sanction cannot be imposed in cases where a taxpayer has justifiable grounds, such as where a taxpayer is deemed to have not been aware of his/her obligations, or where it is unreasonable for him/her to expect the fulfillment of his/her obligations, etc., and where there are circumstances where it is unreasonable for him/her to do so (see, e.g., Supreme Court Decisions 2006Du11750, Oct. 23, 2008; 2002Du666, Aug. 23, 2002). Thus, it is reasonable to deem the taxpayer liable for tax exemption as a justifiable reason.

B) In light of the above legal principles, as seen earlier, the Plaintiff is a joint proprietor of the instant workplace. The fact that one of joint operators of the instant workplace agreed to fulfill the duty to report and pay taxes is difficult to be deemed as constituting justifiable grounds for not being able to have caused the Plaintiff’s failure to report and pay taxes, and the evidence submitted by the Plaintiff alone is insufficient to recognize that the Plaintiff and BB entered into an agreement between the Plaintiff and BB to entirely bear the duty to report and pay taxes at the instant workplace, and there is no other evidence to acknowledge otherwise. Accordingly, each of the instant dispositions is lawful, and therefore, the Plaintiff’s assertion on this part is without merit.

5) Whether the right to state opinion is infringed

Article 81-5 of the former Framework Act on National Taxes provides that "A taxpayer may have an attorney-at-law, certified public accountant, or certified tax accountant participate in an investigation or state his/her opinion when he/she undergoes a tax investigation." This part of the taxpayer's assertion is without merit on a different premise.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and the judgment of the court of first instance is just in conclusion, and the plaintiff's appeal is dismissed as it is without merit. It is so decided as per Disposition.