Tax accounting corporation (Law Firm LLC, Attorneys Kim Iron-min, Counsel for the tax accounting corporation-appellant)

Korea

September 24, 2015

1. The plaintiff's claim is dismissed.

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

The defendant shall pay to the plaintiff 680,671,05 won and 3.7% per annum from February 4, 2012 to February 29, 2012; 4% per annum from March 1, 2012 to February 28, 2013; 3.4% per annum from March 1, 2013 to March 13, 2014; 2.9% per annum from March 14, 2014 to the delivery date of a copy of the complaint of this case; and 20% per annum from the next day to the day of complete payment.

1. Facts of recognition;

A. Status of the parties

1) Gyeonggi-do Si Development Co., Ltd. (hereinafter “ Gyeonggi-do Si Development”) and Egymba Industry Development Co., Ltd. (hereinafter “Egymar”) are companies with the purpose of constructing and selling apartment buildings.

2) The Plaintiff, as a tax accounting corporation with the aim of tax-related business, received national tax refund claims against the Defendant from the Gyeonggi-do Si Development and the rupture.

(b) Reporting on the corporate tax of Gyeonggi-do City Development and Evovour;

1) The Gyeonggi-do Si Development and the Equi r.e., from 2007 to 2010, newly constructed and sold an apartment, and on March 28, 2011, filed a report on corporate tax for the pertinent business year from 2007 to 2010 as indicated below.

A person shall be appointed.

A person shall be appointed.

2) On December 1, 2011, the head of Samsung-ju Tax Office notified 2,487,806,220 won of corporate tax on the Gyeonggi-do Si development in December 1, 201, and on November 1, 201, the head of Samsung-ju Tax Office notified 1,273,109,230 won of corporate tax for the business year of 2010, when the amount of corporate tax to be paid to the tax to be paid to the corporation for the business year of 2010.

3) On the other hand, Gyeonggi-do City Development and Evovoon received a decision of refund of value-added tax overpaid or erroneously paid on December 201, 201, the said value-added tax refund amount (Seoul Special Metropolitan City Development 483,932,349 won, 1,009, 108,393 won) was appropriated for the corporate tax for the business year 2010 (hereinafter “each corporate tax of this case”) of Gyeonggi-do Si Development and Evoon around December 2011.

(c) Transfer of national tax refund claims;

1) On December 2, 2011, Gyeonggi-do City Development transferred KRW 403,190,687 among the national tax refund claims against the instant corporate tax to the Plaintiff on December 2, 201, and 277,480,368 out of the national tax refund claims against the instant corporate tax was transferred to the Plaintiff on December 2, 2011.

2) On February 3, 2012, the Gyeonggi-do City Development and the Sponsorgy submitted a request to transfer the national tax refund to the director of the Namyang District Tax Office.

D. Claim for correction and result of each corporate tax of this case

1) On December 23, 201, 207 through 2010, on the ground that the apartment sales contract was partially cancelled, the Gyeonggi-do Si Development and EWN loan issued a request for correction of each corporate tax (hereinafter “instant request for correction”) to the director of the Namyang District Tax Office (hereinafter “instant request for correction”). On January 201, the director of the Namyang District Tax Office rejected the instant request for correction.

2) On May 14, 2012, the Gyeonggi-do City Development and Luxembourg filed a lawsuit seeking revocation of the refusal disposition against the head of the Namyang-si District Tax Office (Seoul District Court 2012Guhap1789). On April 15, 2014, the said court recommended that the head of the Namyang-si District Tax Office impose reduction upon the instant request for correction, and that the Gyeonggi-do City Development and Hayang-si withdraw the lawsuit.

3) On April 10, 2014, due to the change of jurisdiction from the Namyang Island to the Ischeon Island, the head of Leecheon District Tax Office accepted the adjustment recommendation from the above court and revoked ex officio the disposition of refusal of the instant request for correction on April 15, 2014. On June 30, 2014, the head of this Incheon District Tax Office resolved to rectify the reduction of KRW 2,43,579,924 out of the corporate tax in the instant case of Gyeonggi-do Development, and to refund KRW 531,36,60 among the corporate tax in the instant case of Gyeonggi-do Development and to refund KRW 531,36,60. On July 10, 2014, the head of this Incheon District Tax Office resolved to rectify the reduction of KRW 1,264,303,324 out of the instant corporate tax in the amount of KRW 1,278,974,420 (the details of refund are as follows).

A person shall be appointed.

(e) Notice of the director of the tax office on default of national taxes and additional charges;

On July 3, 2014, the director of the tax office of Leecheon-do appropriated KRW 531,266,600 to the delinquent national taxes and additional dues for the development of Gyeonggi-do, and appropriated KRW 1,278,974,420 to the delinquent national taxes and additional dues for the corporate tax of this case on July 10, 2014 (the details of its own appropriation are as listed below).

A person shall be appointed.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 through 5, Eul evidence Nos. 1 through 11 (including paper numbers), the purport of the whole pleadings

2. The plaintiff's assertion

Article 32 Subparag. 1 of the Enforcement Decree of the Framework Act on National Taxes stipulates the date of payment of national taxes as the date of occurrence of national tax refund under Article 51(3) of the Framework Act on National Taxes in cases where a refund is made due to erroneous payment, double payment, or cancellation or correction of a return or imposition that forms the basis of the payment. The national tax refund of each of the instant cases was made around December 201 by the date of payment of each of the instant corporate taxes, i.e.

On December 2, 2011, Gyeonggi-do City Development and Equi-si (Seoul Special Metropolitan City Development: 403,190,687 won and 277,480,687 won) of the respective corporate tax refund of this case to the Plaintiff, and upon receipt of the request for the transfer of national tax refund on February 3, 2012, notified the Defendant of the transfer of the claims. On December 3, 2011, the amount of overdue loan is KRW 495,98,990, and the Gyeonggi-do Si Development had no national tax in arrears. Thus, if the director of the tax office rendered the decision of the correction of each of the respective corporate tax of this case without any illegal rejection against the request for correction, the Plaintiff was able to immediately receive the amount of the claim acquisition from the Defendant.

If a taxpayer requests a transfer of a national tax refund to another person after notifying the head of the tax office of his/her claim for refund, the head of the tax office shall first appropriate the delinquent national taxes, etc. when the transferor is delinquent, and then pay the balance to the transferee if there is any national tax, etc. for the purpose of examining and verifying whether the transferor is other delinquent national taxes, etc., which shall be paid. In this case, the disposition of refusal to request the correction of the corporate tax in arrears was issued and then the decision of correction was made late, and then appropriate the amount for the delinquent taxes incurred at the time of the decision of correction cannot be deemed to have been appropriated without delay. In addition, the appropriation of the national tax in preference to the assignee of all delinquent taxes incurred by the transferor, regardless of whether it was before

Inasmuch as the director of the Namyang District Tax Office did not immediately appropriate the refund claims that the Plaintiff acquired by the Plaintiff even if he/she received a legitimate demand for transfer from the Gyeonggi-do Si Development and the Sponor, Gyeonggi-do Tax Office, the head of the Namyang District Tax Office did not appropriate the refund claims. This does not take effect even if the director of the tax office appropriated the refund of each of the corporate tax claims of this case from the Gyeonggi-do City Development and the Sponor's national tax in arrears accrued after the date of the transfer of claims after the refund claims of each of the instant corporate tax claims was reverted to the Plaintiff. Accordingly, the Defendant is obliged to pay to the Plaintiff the refund of national tax refund 680,671

3. Determination

(a) Relevant Acts and subordinate statutes (as stated in the relevant Acts and subordinate statutes);

Article 51 (Appropriation and Refund of National Tax Refund)

Enforcement Decree of the Framework Act on National Taxes (the date of national tax refund)

Article 53 (Transfer of Rights to National Tax Refund)

Article 43-4 of the former Enforcement Decree of the Framework Act on National Taxes (Amended by Presidential Decree No. 24366, Feb. 15, 2013)

B. The time when each corporate tax refund claim of this case is finalized

1) Relevant legal principles

A) According to the provisions of Article 51(1) of the Framework Act on National Taxes, the head of a tax office shall immediately determine the amount paid in error, the amount paid in excess, or the amount refunded, among national taxes, surcharges, or expenses for disposition on default. Here, the term “amount paid in error” refers to the amount of tax paid or collected in the absence of a return (in the case of a tax return) or a disposition on imposition (in the case of a tax imposition), which serves as the basis of the payment or collection, or in the absence of a deferred invalidation, or in the event of a deferred invalidation, and the amount of the excess paid in whole or in part, means the amount of tax reduced by either a return or a disposition on imposition, or a revocation or correction, and the amount of tax refunded was lawfully paid or collected but the State did not have a legitimate reason to return each individual tax law. The amount of tax paid in excess, the amount of tax paid in excess, and the amount refunded constitute unjust enrichment received or possessed by the State without

Therefore, a taxpayer’s claim for return of unjust enrichment is already determined at the time of payment or collection, since there is no legal ground from the beginning in the case of erroneous payment, and in the case of excessive payment, it is determined at the time when all or part of the tax liability is extinguished by revocation or correction of the return or disposition, and in the case of tax refund, it is determined in accordance with the requirements for refund under each individual tax law (see Supreme Court en banc Decision 88Nu6436, Jun. 15, 1989; Supreme Court Decision 2008Da31768, Mar. 26, 2009, etc.).

B) As a matter of principle, in a tax return method, a taxpayer’s tax obligation is specifically determined by the act of filing a tax base and amount of tax and the act of filing a return is the performance of the specific tax obligation confirmed by the return, and the State or a local government holds the tax amount paid based on the tax claim so finalized. As such, insofar as a taxpayer’s act of filing a return does not automatically become null and void due to a serious and obvious defect, it cannot be deemed as unjust enrichment. Here, as to whether the act of filing a return constitutes abruptive invalidity due to a significant and apparent defect, the purpose, meaning, function, and legal remedy for the act of filing a return shall be considered as a basis for the act of filing a return, and at the same time, the specific circumstances that may result in the act of filing a return shall be determined reasonably and reasonably (see Supreme Court Decision 94Da31419,

2) Determination

A) The corporate tax is a tax by which a return was filed and, in the case of an erroneous payment, paid or collected even if there is no return which served as the basis of the collection, or the collection was null and void, there is no legal ground from the beginning, and thus, the national tax refund claim is already determined at the time of payment or collection. In the case of an excessive payment, which has been reduced in whole or in part due to revocation or correction of the disposition, even though the return was not null and void, if all or part of the tax

B) The grounds for the instant request for correction are the partial rescission of the apartment sales contract from March 31, 201 to December 13, 2011. Thus, in light of such circumstances, each of the instant corporate tax returns filed on March 28, 201 by Gyeonggi-do City Development and Esim, which were conducted on March 28, 201, cannot be deemed as null and void per annum, and no other circumstance exists to deem that each of the instant corporate tax returns are null and void per annum. Accordingly, each of the instant claims for refund of corporate tax in this case is not only established when part of the tax obligations are extinguished by the disposition for correction of each of the instant corporate tax, but also when each of the instant claims is extinguished by the disposition for correction of each of the instant corporate tax in this case.

B) Article 32 Subparag. 1 of the Enforcement Decree of the Framework Act on National Taxes, which is cited by the Plaintiff as the grounds that the claim for refund of each of the instant corporate tax was finalized around December 201, which was the date of payment of each of the instant corporate tax, is merely a mere presentation of the standard of retroactive time, in accordance with Article 51(3) of the Framework Act on National Taxes amended by Act No. 10405, Dec. 27, 2010, which newly provides the retroactive effect

In other words, prior to the enactment of a retroactive provision on the appropriation of national tax refund, the Supreme Court held that, in principle, the appropriation of national tax refund claims under Article 51 (2) of the Framework Act on National Taxes takes effect only toward the future in principle, and Article 42 of the Enforcement Decree of the Framework Act on National Taxes, which provides the tax authority's prior appropriation right in the transfer of national tax refund claims, cannot be deemed as being applied or analogically applied to the seizure and assignment order of national tax refund claims, and that even if the tax claims were accrued prior to the delivery of the seizure and assignment order, such appropriation cannot be asserted against all creditors unless the appropriation was made after the delivery of the seizure and assignment order (see Supreme Court Decision 2008

In order to solve these problems, Article 51(3) of the Framework Act on National Taxes newly established Article 51(3) and set a retroactive effect on the appropriation of national tax refund, and if the attachment and assignment order was served at the latest time out of the due date of payment of national tax in arrears and the due date of national tax refund under the Enforcement Decree, the attachment and assignment order can be set up against all creditors even if it was appropriated after the delivery

In light of the legislative intent above, Article 32 subparag. 1 of the Enforcement Decree of the Framework Act on National Taxes provides the criteria for retroactive time to determine the “date of national tax refund occurrence” according to delegation of Article 51(3) of the Framework Act on National Taxes, and the above provision cannot be deemed as limiting the scope of application of Article 42 of the Enforcement Decree of the Framework Act on National Taxes, which prescribes the right to make a prior appropriation by the tax authorities with regard

C. Whether the defendant was immediately appropriated

1) Relevant legal principles

In full view of the provisions of Articles 51 and 53 of the Framework Act on National Taxes and Article 43-4 of the former Enforcement Decree of the Framework Act on National Taxes (amended by Presidential Decree No. 24366, Feb. 15, 2013), when a taxpayer requests a transfer of the national tax refund bond to another person after notifying the head of the tax office in writing stating the address, name and address of the transferor and transferee, and the contents of the right to transfer, etc., the taxpayer requests a transfer. The head of the tax office shall immediately investigate and verify whether the transferor has any other delinquent national tax, etc. and then pay the balance to the transferee if the transferor has any delinquent national tax, etc., after appropriating the national tax without delay. If the transferee fails to appropriate the national tax without delay even if he/she received a legitimate request for transfer from the transferor, the transferee’s claim for the national tax refund to which the transferor was transferred shall be finally reverted to the transferee. Accordingly, such appropriation becomes final and conclusive, which results in the collection of the tax claim against the transferor’s property not owned (see, etc.).

In determining whether an appropriation is valid, where a request for transfer is received after the national tax refund claim becomes final and conclusive, it shall be determined on the basis of whether the refund claim was appropriated without delay from the time when the request for transfer was received to the time when the refund claim becomes final and conclusive (see Supreme Court Decision 2008Da31768, Mar. 26, 2009, etc.).

2) Determination

The director of the Namyang District Tax Office received a request for transfer on February 3, 2012, which was before the confirmation of each of the instant corporate tax refund claims. Therefore, it is lawful to appropriate the refund amount of national tax in arrears on July 3, 2014, which was three days after the Gyeonggi-do Office of Tax Payment decided to revise the corporate tax of the instant development on June 30, 2014, when the refund claims became final and conclusive, for the refund amount of national tax in arrears on July 3, 2014, and on July 10, 2014, for the purpose of appropriating the refund amount of national tax in arrears on the date when the refund claims become final and conclusive by the resolution to rectify the corporate tax of the Gyeonggi-do Si Development on July 10, 2

(d) Whether it is possible to appropriate the transferor's delinquent taxes that occurred after the notice of transfer of the national tax refund;

1) Article 35 of the Framework Act on National Taxes and Article 31 of the Local Tax Act provide that national taxes, local taxes, and additional dues and disposition fees for arrears shall be collected in preference to other claims in order to secure tax efficiency, which serves as a financial basis for the existence of the State or a local government. The Constitutional Court, on April 24, 1997, declared that tax priority provisions do not violate the Constitution. In light of the fact that the head of a tax office, upon receipt of a legitimate request from a taxpayer for transfer, fails to appropriate funds without delay, the tax office may appropriate funds for other national taxes, additional dues, or disposition fees for arrears to be paid by the transferor at the time of appropriation (see Supreme Court Decision 2008Da31768, Mar. 26, 2009, etc.).

2) Therefore, it is lawful that the Defendant appropriated the corporate tax refund of this case to the tax refund of each of the instant corporate tax in arrears, which occurred after the date of the transfer of the respective corporate tax refund of this case.

E. Sub-decision

Therefore, the plaintiff's claim on the premise that the defendant's appropriation of each of the national tax refunds of this case to the Gyeonggi-do City Development and the Sphere Bank's delinquent taxes is inappropriate is without merit.

4. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.

[Attachment]

Judges Jeon Jong-Un (Presiding Judge)