The extent to which the business transferee becomes liable for secondary tax payment.

Under the provisions of Article 41 of the Framework Act on National Taxes, the national taxes, additional dues and disposition fees for arrears for which the business transferee is liable for the secondary tax liability are already imposed on the transferor at the time of transfer or acquisition of the business.

Article 41 of the Framework Act on National Taxes

Plaintiff

Head of the Pakistan Tax Office

Seoul High Court Decision 86Gu599 delivered on May 20, 1987

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

1. On the first ground for appeal:

Article 41 of the Framework Act on National Taxes requires that the national tax, additional dues, and expenses for disposition on default imposed on the transferor at the time of the transfer or takeover of the business is the tax imposed on the transferor (see, e.g., Supreme Court Decision 85Nu152, Mar. 11, 1986; Supreme Court Decision 85Nu810, Feb. 11, 1986; Supreme Court Decision 84Nu589, Feb. 26, 1985). The court below confirmed that the plaintiff was not imposed on the non-party at the time of the transfer or takeover of the business from the non-party and decided that the disposition on imposition of the second tax against the plaintiff was unlawful, and there is no error of law by misunderstanding legal principles, such as theory of lawsuit.

2. On the second ground for appeal:

The issue is that: (a) the transaction amount of KRW 56,262,728 on December 31, 1984, which was the tax base of the value-added tax in this case, is not caused by the transaction of the business transferor; and (b) the Plaintiff, the business transferee, is liable to pay taxes for the above transaction amount; (c) even if the secondary tax imposition disposition against the Plaintiff is unlawful, the part of the disposition imposing the tax in this case is legitimate; (d) however, the lower court's failure to deliberate and decide on this issue is a new assertion that it was unlawful; and (e) the disposition imposing the second tax in this case and imposing the Plaintiff on the Plaintiff as the original taxpayer are different in its nature, procedure, method, etc.; and therefore, (e) the second tax imposition disposition in this case and the disposition imposing the second tax as the original taxpayer cannot be seen as a disposition imposing the Plaintiff as the original taxpayer.

3. Therefore, the appeal is dismissed, and the costs of the lawsuit are assessed against the losing party. It is so decided as per Disposition by the assent of all participating judges.

Justices Yoon Yoon-hee (Presiding Justice)