Appropriateness as to the exclusion of the application of the zero tax rate under the purchase approval with serious defects

Even if there is any defect in the procedure of issuance, the transaction made by the purchase approval shall not be excluded from zero-rate tax rate under the Value-Added Tax Act on the sole ground that the Plaintiff was aware of the above defect in the purchase approval at the time of the transaction in this case, and even if the purchase approval was omitted, the validity of the purchase approval is not naturally denied, and there is no provision that the transaction based on the purchase approval is excluded from zero-rate tax rate, so the transaction shall not be excluded from zero-rate tax rate.

Article 11 of the Value-Added Tax Act

1. The Defendant’s imposition of value-added tax of KRW 1,859,565,240 against the Plaintiff on December 17, 2004 shall be revoked.

2. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order.

1. Details of the disposition;

A. The Plaintiff is a juristic person engaged in export and import business, export and import agent business, etc., and from November 9, 199 to December 28, 199, the Plaintiff’s total sales amounting to KRW 10,005,435,500 for 00 for 300,000 for 896 kilograms, July 9, 199 for 283,733,460 for 283,73,460 now for 40, from August 5, 199 to November 4, 199 to 30,000 for 40,000 won for 3,00,000,000 won for 280,000 won for 40,000 won for 3,000,000 won for 40,000 won for 30,000 won for 30,000 won for each of the above transactions.

B. On December 17, 2004, the Defendant rendered the instant disposition imposing value-added tax of KRW 1,859,565,240 on the Plaintiff on February 17, 2004, on the following grounds: (a) the purchase approval letter that Nonparty Company offered to the Plaintiff without a letter of credit for export or based on a false export contract, etc.; or (b) on the grounds of serious defects, such as the omission of the supporting documents, effective date, and date of shipment; or (c) the omission of important descriptions.

[Ground of recognition] Unsatisfy, Gap evidence 1, Gap evidence 2-1 to 28, Gap evidence 3, Eul evidence 1, the purport of the whole pleadings

2. Whether the disposition is lawful;

A. Summary of the parties' assertion

(1) Plaintiff

The Plaintiff traded the instant transaction in a normal manner with the belief that the instant purchase approval was lawfully issued, and even if there were any defects in the procedures for the issuance thereof, it cannot be excluded from the application of zero-rate tax. Therefore, the instant disposition is unlawful.

(2) Defendant

The Plaintiff was recruited with the non-party company in connection with the instant transaction, and even if not, it was well aware of the situation of the domestic gold market, including a de facto transaction behavior with professional experience in the current transaction, and thus, if he had paid little attention, he was in a position to easily understand that the purchase approval was issued illegally without the export letter of credit, etc., or that there was any defect such as the omission of important matters, such as supporting documents, effective date, and date of shipment, but the Plaintiff supplied the instant transaction to the non-party company without collecting value-added tax by applying zero tax rate, and thus, the instant disposition that excluded the application of zero-rate

(b) Related statutes;

/ Value-Added Tax Act

Article 11 Application of Zero Tariff Rates

(1) zero tax rates shall apply to the supply of goods or services falling under any of the following subparagraphs:

1. Exported goods;

Article 24 of the Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 16751 of March 13, 200) and the scope of export

(1) The export as prescribed in Article 11 (1) 1 of the Act shall be a shipment of domestic goods (including the fishery products collected by Korean vessels) from a foreign country.

(2) The exported goods under Article 11 (1) 1 of the Act shall be deemed to include the goods falling under each of the following subparagraphs:

1. Goods supplied by a businessman by a local letter of credit or letter of approval for purchase; and

(1) Enforcement Rule of the Value-Added Tax Act (amended by Ministerial Ordinance No. 133 of March 31, 2000)

Article 9-2 Scope of Local Letters, etc.

(2) A written approval for purchase as provided in Article 24 (2) of the Decree means the approval issued by the head of a foreign exchange bank within the taxable period whereto belongs the time of supply for goods in accordance with a local letter of credit

/ General Rule of the Value-Added Tax Act (wholly amended on August 1, 1998)

The zero tax rates shall apply to the goods supplied under a local letter of credit or letter of approval for purchase as prescribed by the Foreign Trade Act, regardless of whether such goods are used for the purpose of export after they were supplied.

【Foreign Trade Management Regulations

4-2-7 Application for Issuance of Purchase Approval

(1) The head of a foreign exchange bank may issue written approval for purchase pursuant to any of the following subparagraphs:

2. An export contract.

(2) A person who intends to obtain a written approval for purchase shall submit three copies of an application for approval for purchase of raw materials (goods) in attached Form 4-2 to the head of a foreign exchange bank, along with the following documents:

1. One copy of a document falling under any subparagraph of paragraph (1);

2. A contract for supply of goods or a certificate of sale of goods for foreign exchange earnings;

C. Determination

As recognized above, the non-party company presented a letter of approval for purchase equivalent to the purchase price at the time of the purchase from the plaintiff. Such letter of approval for purchase is not a false export contract or a legitimate supporting document, but a letter of declaration for sale of goods or an error, etc. Furthermore, the letter of approval for purchase presented by the non-party company other than ○ Trade Co., Ltd. is not a valid document or number, HS code, name, amount, effective date, effective date, and all or part of the shipment date. The fact that there is no dispute between the parties, or that there is no omission of the entry in the whole or part of the evidence No. 2-1 through No. 28, No. 3, and the statement No. 2 through No. 6, and the whole purport of the pleading can be acknowledged by the parties

According to the above facts, although the plaintiff's letter of purchase issued in the course of its supply to the non-party company on the basis of a false export contract, etc., there is any defect in the issuance procedure, even if there is no evidence that the plaintiff knew of the above defect in the letter of purchase at the time of the transaction in this case, the transaction in this case made by the letter of purchase cannot be excluded from zero-rate tax rate under the Value-Added Tax Act. Furthermore, even if some of the letter of purchase was omitted, the validity of the letter of purchase does not automatically be denied, and there is no provision that the transaction based on the letter of purchase is excluded from zero-rate tax rate, and even if the plaintiff presented a letter of purchase with some omitted entry from the other non-party companies except the ○ trade in this case, the transaction shall not be excluded from zero-rate tax rate.

Therefore, the disposition of this case which did not apply zero tax rate to the transaction of this case is illegal.

3. Conclusion

Therefore, the plaintiff's claim of this case shall be accepted on the grounds of its reasoning, and it is so decided as per Disposition.