early 2009west2053 ( December 23, 2009)

The propriety of the disposition on returned assets as a processing tax invoice without real transaction;

The input tax amount related to the returned items, among the input tax amounts of the tax invoice received, shall not be deducted, and the disposition of non-deductible the depreciation costs of the assets related thereto shall be justified.

The contents of the decision shall be the same as attached.

○○○ Corporation

Head of Mapo Tax Office

1. The plaintiff's claim is dismissed.

2. The plaintiff shall bear the litigation costs.

The Defendant’s imposition disposition of KRW 326,970,730 for the first term of 2004 against the Plaintiff on March 5, 2009 and corporate tax of KRW 73,176,387 for the business year of 2004 and corporate tax of KRW 83,187,080 for the business year of 205 shall be revoked.

1. Circumstances of dispositions;

A. On July 26, 2004, the Plaintiff deducted the input tax amount from 3,015,535,000 won based on the purchase tax invoice 8, which is the aggregate of the supply values issued by △△△D Co., Ltd. (hereinafter referred to as “△△D”), as indicated in the attached tax invoice list, and filed a return on the value-added tax for one year in 2004.

B. On August 2004, the Defendant confirmed that some of the items (U.V., observer, observer, and Thompson) supplied by the Plaintiff among the items (U.V., observer, and Thompson) were returned in the course of the on-site verification of the refund of value-added tax in relation to the above declaration, and deducted the input tax amount according to the tax invoice No. 2 No. 1 5,215,535,000 in total from the purchase tax invoice No. 2,215,535,000 in relation to the above items (hereinafter “the instant

C. As a result of conducting a tax investigation with respect to the Plaintiff between April 2008 and November 2008, the Defendant confirmed that the Plaintiff received the instant tax invoice equivalent to KRW 2,215,535,000 of the value of supply in the taxable period of value-added tax for the first quarter of 2004, even though only the machinery equivalent to KRW 428,363,636 was supplied from △△D in the taxable period of value-added tax for the second quarter of 2004.

D. Accordingly, the Defendant: (a) determined that a tax invoice (289,572,00 won in the supply price, No. 4,500 in the attached Table Nos. 1,925,963,00 in the attached Table Nos. 4,50 in the supply price) paid for the taxable period of value-added tax for the first quarter of 2004 falls under the input tax credit; (b) on the other hand, a processing tax invoice (1,925,963,00 won in the supply price) without any real transaction (1,787,173,000 won in the supply price) or a different tax invoice (138,790,000 won in the supply price); and (c) denied the depreciation costs corresponding to the processed asset; and (d) notified the Plaintiff on March 5, 2004 of the corporate tax amount for the business year of 1,326,970,730, and the corporate tax amount for the business year of 841,2005.

E. Accordingly, on May 4, 2009, the Plaintiff filed an appeal with the Tax Tribunal. On December 23, 2009, the Tax Tribunal rendered a decision that the supply price of machinery supplied by the Plaintiff from △△D ought to be KRW 650,000,000, on the ground that the supply price of machinery supplied by △△D ought to be deemed to be KRW 650,000,000.

F. Accordingly, the Defendant changed the initial disposition to the imposition disposition of KRW 326,970,730 for the first term of 2004 and KRW 73,176,387 for the business year of 2004 and corporate tax of KRW 83,187,080 for the business year of 205 (hereinafter “instant disposition”) (hereinafter “instant disposition”).

[Ground of recognition] Facts without any dispute, Gap's 1, 2, Eul's 1 to 7, the purport of the whole pleadings

2. Whether a disposition is lawful

A. The plaintiff's assertion

In light of the sales contract between the Plaintiff and △△D, and the result of on-site verification of the refund of value-added tax performed by the Defendant on August 2004, the Plaintiff purchased and received machinery, etc. equivalent to KRW 2.5 billion from △△D within the taxable period of the value-added tax for the first quarter of 2004, and the price was paid by the Plaintiff by means of offsetting the Plaintiff’s credit against the management owner KimA.

Therefore, the instant tax invoice is unlawful since the value of supply and the time of supply coincide with the actual transaction, and thus, the Plaintiff’s deduction of the value-added tax amount based on the said tax invoice is legitimate, even though it is legitimate, since the Defendant imposed value-added tax and corporate tax on the instant tax invoice by deeming the said tax invoice as a processing tax invoice without any actual transaction

(b) Fact of recognition;

1) On March 2004, the Plaintiff entered into an agreement with the instant company to comprehensively acquire the equipment used in the manufacture of the PP packing materials and the technology, rights, etc. related to the manufacture of the PP packing materials from the instant company.

2) On July 22, 2004, the Plaintiff entered into the following arrangements with the newB, which was the representative director of △△△D:

3) On August 2004, the Plaintiff prepared a sales contract for the goods of the kind of machinery equivalent to the value of 1.6 billion won on March 10, 2004, retroactively with △△△D, in order to submit it as explanatory materials for the Defendant’s on-site investigation of refund of value-added tax, and prepared a sales contract for the patent right (trademark) equivalent to the value of 90 million won on April 26, 2004.

In addition, on August 16, 2004, the Plaintiff prepared a sales contract for goods, the supply value of which is modified from KRW 1.6 billion to KRW 800 million, by excluding KRW 800,000,000,00,000 from the subject matter of sale under the goods sales contract, from among the subject matter of sale under the goods sales contract as of March 10, 2004.

4)On the other hand, between July 31, 2004 and August 31, 2004, the Plaintiff received the following mechanical devices (the supply price of 6.5 million won) from △△D, and the Plaintiff paid △△D KRW 318,530,000 in advance as the purchase price for the mechanical devices between March 12, 2004 and June 14, 2004.

5) On April 4, 2005, the Plaintiff agreed with the newB as follows:

6) Pursuant to the agreement on April 4, 2005, 2005, newB transferred to the Plaintiff the registered name of No. 00000 of the patent in the name of newB owned, and of No. 0000 of the patent in the name of △△di, which is on the date of the agreement, and the Plaintiff paid KRW 200 million by January 18, 2008, including the payment of KRW 200 million to the doorCC designated by the newB.

[Ground of recognition] Facts without any dispute, entry of Gap Nos. 3, 4, and No. 8 to 10, the purport of the whole pleadings

C. Determination

As seen earlier, the Plaintiff entered into a sales contract for machinery, equipment, etc. between July 31, 2004 and August 1, 2004, and received 6.5 million won of supply value from △△D, and between March 12, 2004 and June 14 of the same year, 318,570,000 won of supply price for machinery and equipment (289,572,958,000 won + 28,000 won of supply price) can be found to have been paid in advance to the Defendant for 200,000 won of supply price for each of the above 20,000 won of supply price for 20,000 won of supply price for each of the above 40,000 won of supply price for the above 204,000 won of supply price for the above 204,000,0000 won of supply price for each of the above 20,004,04,04.

3.In conclusion

Thus, the plaintiff's claim is dismissed as it is without merit.