Seoul Administrative Court 201Guhap4503 ( October 10, 2011)

early 2010west0299 ( November 18, 2010)

Amount to be compensated for stock options shall be deductible expenses as personnel expenses.

(as in the judgment of the first instance court) Disposition rejecting a claim for correction on the premise that it is opposed to the above, even though the expenses incurred by officers and employees in exercising their stock options correspond to the personnel expenses incurred in relation to their business for profit-making activities.

2011Nu2208 Revocation of revocation of request for rectification

AA Bank, Inc.

The director of the tax office

Seoul Administrative Court Decision 201Guhap4503 decided June 10, 2011

November 30, 2011

January 11, 2012

1. The defendant's appeal is dismissed.

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

1. Purport of claim

The defendant's refusal to request correction is revoked on November 10, 2009, respectively, as stated in the detailed statement of refusal to request correction against the plaintiff.

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. cite the judgment of the first instance;

The reasons for use in this case are as follows, except for the addition of the judgment to the chief of the State in the trial by the defendant, and the reasons for use of this case are as follows: Article 8(2) of the Administrative Litigation Act and the main sentence of Article 420 of the Civil Procedure Act:

B. The Plaintiff’s officers and employees granted the Plaintiff’s stock option based on the Plaintiff’s shares in the form of treasury stock delivery under the main sentence of Article 340-2(1) of the Commercial Act before delistinging the Plaintiff’s shares. The said stock option, along with the delisting, was replaced with the right to purchase shares based on the Plaintiff’s shares, and thereafter, after the Plaintiff’s shares were delisting, the right to purchase shares based on the AA financial branch shares was granted (hereinafter “stock option based on the Plaintiff’s shares, and the part related to the disposition of the order as the stock option based on the Plaintiff’s shares (hereinafter “instant shares purchase option”). The instant stock option was operated in cash by paying the difference settlement method under the proviso of Article 1340-2(1) of the Commercial Act, namely, when the Plaintiff’s employees and employees exercise the instant stock option, the difference between the exercising price of the right to purchase shares and the real value (market price), and the Plaintiff agreed to pay the instant amount to the Plaintiff for the exercise cost of the instant stock option.

2. Determination on the assertion added in the trial

A. Defendant’s assertion

Since the Plaintiff caused the cost of stock compensation at the time of granting the stock option as labor cost, if the instant compensation amount, which is the cost of exercising the stock option, is again included in deductible expenses, the cost would be double appropriated.

B. Determination

1) The following facts are either a dispute between the parties, or acknowledged that the entire purport of the pleadings is added to the statements in the Evidence Nos. 8, 16, and 18. The Plaintiff: (a) accounting and tax adjustment with respect to the instant stock option was made by the following methods. If the Plaintiff stated the stock option annually and the details of the exercise are indicated as stock compensation costs and long-term and low-term expenses, the following table

2) According to the above facts, at the time of granting the stock purchase option, which is the method of settling the difference among the executives and employees, the Plaintiff reserved the stock compensation cost in the absence of deductible expenses, and thereafter, there is no evidence to support the fact that the Plaintiff, upon exercising the stock option and paying the difference in exercising the stock option, claimed the industry of deductible expenses by filing a request for correction of deductible expenses, even if the stock option was previously reserved at the time of paying the difference in exercising the stock option. The Defendant’s assertion is without merit.

3. Conclusion

The appeal is dismissed.