National High Court Decision 2007Du4034 (208.09)

Whether it is a nominal transaction without any supply of goods in connection with gold bullion transactions.

Until the gold bullion is imported and exported, a series of transactions can not be deemed a nominal transaction solely on the basis of the fact that there is a company with a bombomb in the middle.

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

1. The Defendant’s imposition of value-added tax of KRW 9,160,462,020 for the first quarter of 2003 against the Plaintiff on August 6, 2007, value-added tax of KRW 10,198,81,400 for the second quarter of 2003, value-added tax of KRW 10,878,890,530 for the first quarter of 2004, value-added tax of KRW 406,407,150 for the second quarter of 204 is revoked.

2. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order.

1. Circumstances of the disposition;

A. The Plaintiff is a company established for the purpose of importing and wholesale and retailing aluminium products.

B. The Plaintiff reported the input tax amount of KRW 188,157,550,00 in total and KRW 109 in gold bullion (gold bullion above 99.5%) purchase tax invoice for gold bullion (gold bullion above 99.5%), as shown in the attached Table, after deducting the input tax amount of KRW 109 (hereinafter “the tax invoice of this case”) from the output tax amount.

C. Meanwhile, the director of the Seoul Regional Tax Office conducted a tax investigation against the plaintiff, and notified the defendant that the tax invoice of this case is false. The defendant, on August 6, 2007, considered the tax invoice of this case as a non-real transaction and deducted the input tax amount from the non-real transaction, and issued a revised and notified the plaintiff on August 6, 2007 that the tax invoice of this case was 9,160,462,020, value-added tax of 10,198,81,881,400, value-added tax for 2 years 2003, value-added tax for 10,878,890,530, value-added tax for 10,878,890,530, value-added tax for 2 years 204 and 406,407,150 won for value-added tax for 2 years 2004

D. On September 28, 2007, the Plaintiff filed an appeal with the National Tax Tribunal on September 28, 2007. On May 9, 2008, the Plaintiff filed the instant lawsuit on July 25, 2008.

[Ground of recognition] Facts without dispute, Gap evidence 1-1, 2, Gap evidence 5-1 to 18, Eul evidence 1-1 to 4, the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The parties' assertion

1) The plaintiff's assertion

The plaintiff actually purchased gold bullion from the business partner of this case and actually traded it to export it to the revenue commercial in Hong Kong, and does not engage in an irregular transaction in collusion with the so-called wide carbon business for the purpose of unjustly refunding value-added tax. Thus, the defendant's disposition based on the premise that the tax invoice of this case is false is illegal.

2) Defendant’s principal

The plaintiff's purchase and export of the gold bullion of this case and the preparation and issuance of a tax invoice therefor are merely a formal most action made to evade value-added tax in collusion with so-called wide carbon enterprises, etc.

(b) Related statutes;

It shall be as shown in the attached Form.

C. Determination

Any kind of tobacco trading process: Specific trading price is subject to Article 1 (1) 1 and 6 of the Value-Added Tax Act.

Determination as to whether goods are supplied subject to value-added tax under Article 17(1) of the Value-Added Tax Act ought to be made individually and specifically by comprehensively taking account of various circumstances, such as the purpose and manner of each transaction party’s transaction, the volume and subject of profit attribution, and payment relationship of consideration. The burden of proving that a specific transaction constitutes a “tax invoice different from the fact under Article 17(2)1-2 of the Value-Added Tax Act, for which the deduction of an input tax amount is denied on the ground that the specific transaction is a nominal transaction without actual delivery or transfer of goods (see Supreme Court Decision 2008Du19192, Feb. 12, 2009).

Comprehensively taking account of the overall purport of the arguments in Gap evidence 2-1 through 110, Gap evidence 3-1 through 70, the plaintiff purchased gold bullion equivalent to the total value of KRW 188,157,50,000 from the trading company of this case as shown in the attached table between March 18, 2003 and December 15, 2004, and received the tax invoice of this case after receiving the transfer of these gold bullion, and the plaintiff exported all the gold bullion to Hong Kong import and export them, and then gave considerable profits in the process. Upon examining the above facts in light of the legal principles as seen earlier, it is difficult to conclude that the above gold bullion was traded within a short period of time until the above gold bullion was imported and exported, and the value-added tax was exempted at the interim stage, and it is difficult to prepare and deliver the tax invoice of this case as value-added tax, and the actual transaction of the gold bullion is not related to the goods supplied or received.

Therefore, under the title of the transaction without supplying the goods of this case, the defendant's disposition of this case is unlawful, which did not deduct the purchase tax amount by deeming the tax invoice as a different tax invoice from the fact provided in Article 17 (2) 1-2 of the Value-Added Tax Act.

3. Conclusion

If so, the plaintiff's claim for objection case is justified, so it is decided with the same order to accept it.