Seoul Central District Court-2016-Gohap-52648 ( November 14, 2017)

Although there is no room for dispute over the interpretation of the legal principle clearly stated, if the tax authority imposed a tax disposition, it is obligated to return unjust enrichment due to the invalidity of the legal principle.

(As in the judgment of the first instance court), it is clearly stated whether it falls under the largest shareholder, etc. according to the judgment of the Supreme Court, and there is no room for dispute over the interpretation thereof, if the tax authority imposed a tax disposition, it shall be null

The donation of profits accrued from the listing of shares or equity shares under Article 41-3 of the Inheritance Tax and Gift Tax Act.

Seoul High Court 2017Na2071353 Undue gains

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Korea

15, 2018

2018.04.05

1. The defendant's appeal is dismissed.

2. The costs of appeal shall be borne by the Defendant.

[Claim]

The defendant shall pay 00% interest per annum to the plaintiff from December 17, 2012 to the service date of a copy of the complaint of this case, and 15% interest per annum from the next day to the day of complete payment.

【Purpose of Appeal】

The part against the defendant in the judgment of the court of first instance shall be revoked, and the plaintiff's claim corresponding to the revocation shall be dismissed.

1. Quotation and additional determination of the judgment of the first instance court

In addition to the reasoning for the judgment of the first instance that cited in accordance with the main sentence of Article 420 of the Civil Procedure Act, the Defendant’s disposition of gift tax on September 17, 2012 against the Plaintiff (hereinafter “instant disposition of taxation”) is null and void as a matter of course. Therefore, the Defendant should return gift tax collected from the Plaintiff in accordance with the instant disposition of taxation to the Plaintiff as unjust enrichment.

【Additional Judgment】

① In order for a taxation disposition to be null and void as a matter of course, it is insufficient to say that there is an unlawful ground for the disposition. The defect is an important violation of an important statute, and objectively apparent. If there are objective circumstances that make it possible to mislead a person to be subject to taxation on certain legal relations or factual relations that are not subject to taxation, and it can only be clarified whether it is subject to taxation or not, it cannot be deemed apparent even if the defect is serious, and thus, it cannot be said that the taxation disposition that misleads the person to be subject to taxation cannot be deemed null and void as a matter of course. However, as long as there is no legal relation or factual relation which is subject to taxation, it is obvious that the defect is significant and obvious (see Supreme Court Decision 2012Da990, Mar. 29, 2012).

In the instant case, the Defendant purchased 2,200 shares of EOO Co., Ltd. from EO (hereinafter referred to as EO Co., Ltd.; hereinafter referred to as "EO Co., Ltd."; hereinafter the same shall apply) from EO, and NO, a seller, was in the position of Non-Party Co., Ltd. under Article 41-3 (1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 9916, Jan. 1, 2010; hereinafter the same shall apply) which was in force at the time of the sale of shares, and further, the Plaintiff and NO Co., Ltd. were in the status of "the largest shareholder, etc. of Non-Party Co., Ltd." under Article 41-3 (1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 9916, May 1, 201; hereinafter the same shall apply). However, as stated in the judgment of the first instance court, it cannot be seen that the Plaintiff and Non-Party No.

Therefore, there is no legal relation or factual basis subject to taxation, and there is no objective circumstance that the tax authority at the time of the disposition could mislead the person to be subject to taxation as to the legal relation or factual relations related to the sale and purchase of the instant stocks.

② On February 2, 2012, Article 19(2) of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act (hereinafter “the provision of this case”) stipulating the scope of “the largest shareholder, etc.” under Article 41-3(1) of the former Inheritance Tax and Gift Tax Act should be deemed to have been in the position of “the largest shareholder, etc. of the non-party company” on the ground that it was revised in the direction to clarify the taxation practice which had been interpreted as having been in the position of “the largest shareholder, etc., including a person who has a special relationship with the shareholder, etc., the largest shareholder, etc., prior to the amendment of the provision of this case. However, it is difficult to find it clear that the provision of this case was revised as above, and there is no reason to view that there was a special relationship between the Plaintiff and the non-party company under Article 510(1) of the former Inheritance Tax and Gift Tax Act, which had been in the position of “the largest shareholder, etc., including a person who has a special relationship with the shareholder.”

③ In this case, the Plaintiff prepared and reported a tax base return and ‘tax base return of gift tax', and there is no particular dispute that the Plaintiff paid gift tax following the instant tax assessment. However, if the purport of the entire pleadings is added to the Plaintiff’s evidence Nos. 5-1, 2, 6, 7, and 8, and evidence Nos. 9-1 and 2, the Defendant had omitted the Plaintiff’s report of gift tax based on the purchase of stocks of this case, despite the Plaintiff’s explanation on December 2, 2011, and provided the Plaintiff with an explanation that the Plaintiff would be subject to tax assessment by January 2, 201, and that the Plaintiff would have failed to report and pay the gift tax, including the tax base return and the additional tax due to the failure to report and the non-payment, and that the Plaintiff would have failed to report and notify the Plaintiff of the fact that the Plaintiff received the above tax base return and the non-payment of gift tax in accordance with the Defendant’s instruction on January 5, 2012.

④ Furthermore, even though the defect revealed in the taxation disposition of this case was in violation of important laws and regulations, and the mistake of facts objectively shows the degree of illegality, it did not correct the taxation disposition in this case. Considering the necessity of stability and smooth operation of the taxation administration, it may hinder the trust in the taxation disposition and lead to the failure of taxpayers to remedy their rights and interests. Furthermore, even if the taxation disposition of this case is deemed null and void as a matter of course, it is not likely that the loss may occur to a third party, or that it might interfere with the stability and smooth operation of the taxation administration of this case. Accordingly, even if the Plaintiff filed the lawsuit of this case seeking the return of the gift tax in accordance with the taxation disposition of this case without undergoing the objection procedure, such circumstance may not affect the gross and apparentness of the defect in the taxation disposition of this case.

2. Conclusion

Therefore, the judgment of the first instance court is legitimate, and the defendant's appeal against it is dismissed as it is without merit. It is so decided as per Disposition.