(a) Whether the taxation authority's disposal of the difference in the amount of accounts for which the former representative director purchased fixed assets at a high price and embezzled the difference, and then the juristic person takes measures, such as filing a claim for restitution to recover the difference, affects the propriety of the disposition of the above income;

(b) Whether there is no obligation to withhold taxes from a corporation where the person to whom the income belongs retires;

A. As long as the tax authority recognized the transfer of the fixed assets and notified the change in the amount of income by disposing of the difference in the amount of the accounts that the former representative director purchased at a high price and embezzled the difference, and accordingly, the tax authority has the obligation to collect withholding tax on the company's income, even if the company filed a lawsuit claiming compensation for the recovery of the amount of embezzlement with the knowledge of the above fact that it should have been immediately known after the disposition of the tax authority, or that the provisional attachment procedure for the debtor's property was commenced, the validity of the disposition of income should not be determined.

(b) In case of a corporation’s obligation to withhold Class A earned income tax from the disposition of income, the corporation concerned shall not be deemed to have any obligation to withhold tax on the ground that the person to whom the income belongs retired and it is impossible to withhold tax;

(a) Article 32(5) of the Corporate Tax Act; Article 94-2(1) of the Enforcement Decree of the Corporate Tax Act;

[Plaintiff-Appellant] Plaintiff 1 and 1 other (Law Firm Gyeong, Attorneys Park Jae-soo et al., Counsel for plaintiff-appellant)

[Judgment of the court below]

Head of Namyang District Tax Office

Seoul High Court Decision 94Gu36508 delivered on May 24, 1995

The appeal is dismissed.

The costs of appeal are assessed against the plaintiff.

We examine the grounds of appeal.

(1) On August 20, 1989, the court below held that the non-party 1 purchased the plaintiff company's representative director at the time of August 20, 1989 as the plaintiff company's 15 forest land 10,000,000, which was held in the order of gambling in the Gyeonggi-gu as the representative director of the non-party 1, and prepared a related document for 250,000,000, and embezzled the difference. The defendant made the above 150,000,000 won with respect to the plaintiff company on July 31, 1993, and made a notice of the change in the amount of income as bonus to the non-party 1 as the representative director at the time of the non-party 1's retirement income, which was the non-party 1's representative director at the time of collection, and thus, it was justified to recognize the non-party 1's act of collecting the amount of income at the time of the first embezzlement.

In light of the records, the above recognition judgment of the court below is acceptable, and as long as the duty to withhold tax on the income of the plaintiff company was lawfully generated by the notice of change in the above income amount, the plaintiff company should be aware of the above fact after the disposition of this case and then filed a lawsuit seeking compensation for the recovery of the embezzled amount, or the provisional seizure procedure for the debtor's property was commenced, the possibility of recovery of the above embezzlement amount does not depend on the propriety of the above disposition of income. The arguments are without merit.

(2) As to the second issue (related to provisional payment)

In this case, the court below's decision that the defendant's embezzlement amount of the non-party 1 is correct and correct as bonus to the person who carried out the non-party 1's embezzlement, and therefore it cannot be deemed that there is any error in that it does not regard it as provisional payment, and even if the plaintiff asserted that it is reasonable to regard the non-party 1's embezzlement amount as provisional payment while citing the decision of the National Tax Tribunal, it cannot be said that the court below has a duty of explanation as to whether it is a disposition contrary to tax practice or good faith principle. The argument is without merit.

(3) As to the third point (based on the misunderstanding of the legal principles as to the withholding obligation), it cannot be said that the person to whom the income belongs was unable to retire and withhold the withholding tax due to his retirement from the corporation’s obligation to withhold the Class A earned income tax from the disposition of income. The argument is without merit.

(4) Therefore, the appeal is dismissed and all costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Don-hee (Presiding Justice)