In order to make an unjust enrichment, the error of taxation is so serious that the defect of taxation disposition is so obvious that it can be subject to the invalidation of the taxation disposition.

Even if there was an error of law by mistakeing the actual operator, not the representative in the register of register, the facts based on the taxation disposition can only be seen as an objective circumstance that could mislead the person to be subject to taxation, and therefore, it cannot be seen as an objective apparent defect in appearance.

Article 67 (Disposition of Income)

2016 Gohap34811 Return of unjust enrichment

AA

Korea

April 28, 2017

June 23, 2017

1. The plaintiff's claim is dismissed.

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

The defendant of the Gu office shall pay to the plaintiff 1,211,195,860 won and 15% interest per annum from each day to the day of service of a copy of the complaint of this case, and 5% interest per annum from the next day to the day of full payment.

1. Basic facts

A. From January 8, 2007 to April 21, 2009, the Plaintiff was registered as a representative director in the corporate register ofCC Co., Ltd. (hereinafter “CC”).

B. The commissioner of the DDA Regional Tax Office conducted a tax investigation onCC from May 29, 2007 to June 29, 2007, and confirmed thatCC omitted the revenue amount of KRW 1,938,110,384 from 2002 to 2005 (hereinafter “the subject taxable period”). On October 19, 2007, the director of the EE Tax Office notified it to the head of the EE Tax Office. On October 10, 2007 based on the omitted revenue, the director of the EE Tax Office imposed value-added tax of KRW 335,129,780 among the omitted revenue during the subject taxable period, and notified it toCC on October 19, 207 (hereinafter “the notice of change in revenue”).

C. On February 1, 2008, the FF Head of the FF Tax Office imposed a total of KRW 865,376,161 on the Plaintiff from 202 to 2004 during the taxation period subject to the notice of change in the income amount, and subsequently, revised and notified the Plaintiff as a total of KRW 672,939,834 on October 23 of the same year by recalculationing the penalty tax in bad faith for payment (hereinafter “instant taxation disposition”).

D. The Plaintiff paid 1,01,745,160 won to the Defendant, including additional dues, as shown in the attached Form (Provided, That the amount paid as of July 31, 2009, KRW 100,000,000,000, and KRW 68,600,480,000, and KRW 9,711,050,050, and KRW 21,139,170, which are paid as of May 16, 2013, are all unrelated to the instant taxation, and it excludes all details that are irrelevant to the instant taxation.) as of May 16, 2013, the Plaintiff paid 1,01,745,160 won to the Defendant, including the amount of the tax imposed under the instant taxation. [Grounds for recognition] without dispute, the Plaintiff’s assertion and judgment on February 2, 2012

A. The plaintiff's assertion

The Plaintiff asserts that the Plaintiff did not have registered as the representative director in the corporate register during the taxable period subject to the instant taxation, and that the instant taxation disposition reverted to the Plaintiff, who did not actually operatedCC, and that the Plaintiff did not have any legal relations or factual relations, which are subject to the instant taxation, was null and void because it was a tax disposition imposed on the person who did not have any factual relations or factual relations, and thus, the defect is significant and apparent. Therefore, the Defendant asserts that the Plaintiff should return the global income tax of KRW 1,211,195,860 (the amount exceeding KRW 1,01,745,160, out of the said amount paid by the Plaintiff for the foregoing reasons, is in itself unrelated to the instant taxation disposition

In order to make an unjust enrichment by mistake in taxation, the tax payment or collection of tax must be null and void as it has no legal basis at all under substantive or procedural law, or because of its significant and apparent defect. In a case where the defect of taxation is limited to the extent that the tax disposition can only be revoked, unless the tax authority voluntarily cancels it or cancels it by the appeal procedure (see, e.g., Supreme Court Decision 94Da28000, Nov. 11, 1994). In a case where a person who does not have any legal relation or factual relation subject to taxation at all, it shall be deemed that the defect is significant and obvious, but where there are objective reasons to believe that it is subject to taxation with respect to any legal relation or factual relation that is not subject to taxation and factual relation that are not subject to taxation, the taxation disposition should not be deemed null and void as it is impossible to make a mistake in the fact that it is obviously apparent even if it is serious, and it cannot be deemed null and void (see, e.g., Supreme Court Decision 9Da28000, etc.).

Court Decision 2000Da24986 delivered on July 10, 2001

In the instant case, according to the evidence No. 1, Park G and Kim HH recorded as the representative director ofCC during the taxable period subject to the instant taxation, it is deemed that the Plaintiff did not have any legal or factual relations subject to the instant taxation, and there is no other evidence to acknowledge it. Rather, according to the evidence No. 5 and No. 6, the Director of the Regional Tax Office affiliated with the Defendant, the Plaintiff owned 70/100 of the shares issued by theCC during the pertinent taxable period from January 17, 2002 to October 2005, and the Plaintiff was registered as the representative director from January 17, 2002 to March 12, 2002, and the Plaintiff was found to have been actually engaged in the instant tax assessment on behalf of the representative director ofCC and the Plaintiff, based on the following facts: (a) the Plaintiff was found to have been registered as the representative director at the time of the pertinent taxable period, and (b) the Plaintiff was found to have engaged in the instant tax assessment on behalf of the representative director ofCC 207.

Even though there was an error by the Defendant’s mistake as the Plaintiff’s assertion in the instant taxation disposition, the fact that the Defendant used as the basis for the instant taxation disposition is erroneous, it can be found that the Defendant’s determination of whether the Defendant actually enjoyed theCC as an objective circumstance that could misleads the Plaintiff to be subject to taxation can be revealed only when it should accurately investigate the operation status, etc. of theCC. Therefore, such mistake does not constitute an objective apparent defect. Therefore, the Plaintiff’s assertion on the premise that the instant taxation disposition is void as a matter of course is without merit.

3. Conclusion

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