Cho Jae-Seoul 2015-Divisions-3938 ( October 15, 2015)

Whether a tax invoice received by the plaintiff is a tax invoice received without a real transaction

Tax invoices received by the plaintiff are different from the facts, or it is unreasonable that no input tax deduction is made as a bona fide transaction party.

Article 39 of the Value-Added Tax Act

2016Guhap20136 (Revocation of Disposition of Imposition of Value-Added Tax, etc.)

Dog Dog

Head of North Busan District Tax Office

April 13, 2017

June 29, 2017

1. The Defendant’s imposition of value-added tax of KRW 17,275,10 for the first period of March 5, 2015, KRW 17,275,110 for the second period of March 5, 2011, KRW 1,949,890 for the second period of December 201, and KRW 2,567,590 for the second period of year 2012, imposition of corporate tax of KRW 30,593,650 for the business year 2012, and disposition of imposition of corporate tax of KRW 30,593,650 for the second period of March 24, 2015, the income amount of KRW 119,411,60 for the year 201, the income amount of KRW 17,523,00 for each income amount of KRW 20 for the second period

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

Cheong-gu Office

The same shall apply to the order.

1. Details of the disposition;

A. The Plaintiff received 124,486,00 won purchase tax invoice of KRW 10,00 (attached Table 1); hereinafter “instant tax invoice”) as a corporation engaged in the business of manufacturing new products and components in Busan Seo-gu, 201, and the amount of the said tax invoice was deducted from the input tax amount and filed a return on the value-added tax and the corporate tax in deductible expenses by adding the amount of the said tax invoice to deductible expenses.

B. From March 1, 2014 to June 5, 2014, the Defendant conducted a tax investigation with respect to Ktech, and deemed that the instant tax invoice was falsely prepared without real transaction; and on March 5, 2015, the Defendant issued a notice of disposition to the Plaintiff as a bonus income amount of KRW 17,275,110 for the first term portion in 2011, KRW 17,275, KRW 110 for the second term in 2011, KRW 19,890 for the second term in 2011, KRW 2,567, and KRW 590 for the second term in 2012, KRW 30,593, and KRW 650 for the second term in 2012, KRW 30,593, and on March 24, 2015, KRW 119, KRW 160, KRW 201, KRW 2012 for the first term in 207.

C. Accordingly, the Plaintiff filed an objection on June 1, 2015 with the Tax Tribunal on July 17, 2015.

However, it was dismissed on October 15, 2015.

D. On the other hand, on December 24, 2015, AA was convicted of having issued a false tax invoice to other companies, including the Plaintiff, in the instant case (hereinafter “related case”), including the violation of the Punishment of Tax Evaders Act (hereinafter referred to as “the Punishment of Tax Evaders Act”), etc. on December 24, 2015. While AA appealed as the court 2016No161, it was dismissed on November 24, 2016, and the Supreme Court appealed as the Supreme Court Decision 2016Do2059, but dismissed on February 24, 2017. KTech was dismissed on the grounds that “the fact of suspicion of the violation of the Punishment of Tax Evaders Act is recognized by the prosecutor of the Busan District Prosecutors’ Office on December 11, 2014, but it is not possible to execute the sentence due to the closure of business.”

[Ground of recognition] Facts without dispute, Gap evidence 1, 5 evidence, Eul evidence 1 to 6, facts with merit in this court, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The Plaintiff received the tax invoice of this case and reported the value-added tax and the corporate tax, after actually awarding a contract for Gap's rewing work to Ktech. Therefore, the instant disposition is unlawful.

B. Relevant statutes

Attached Table 2 shall be as stated in the relevant statutes.

C. Determination

(1) Relevant legal principles

In principle, the burden of proving that a tax invoice received in the course of a specific transaction constitutes an "tax invoice different from the fact that the input tax deduction is denied on the ground that the specific transaction is a nominal transaction without actual delivery or transfer of goods (see, e.g., Supreme Court Decision 2008Du13446, Jun. 23, 2009). In addition, if a criminal judgment becomes final and conclusive in administrative litigation, it may be acknowledged that it is inconsistent with the above criminal judgment if there are special circumstances to deem it difficult to adopt a factual judgment.

(2) Determination

In light of the following circumstances, the evidence submitted by the Defendant alone is insufficient to acknowledge that the instant tax invoice is a “tax invoice different from the facts not accompanied by real transactions” and there is no other evidence to acknowledge it. Therefore, the instant disposition based on such premise is unlawful.

(A) In around 2010, the Plaintiff received a business registration certificate of KRte from KRte, which is a director of KRtec, from KRtec, while the demand and order of the new product were increased, and confirmed the work site of Kapcck in Busan, which is introduced by TPP, and entered into a contract with KRtec. In light of the fact that this TPP is a person who is not an employee of KRtec, but a separate employee of KRtec, but a person who is engaged in the new project. However, the Plaintiff appears to have entered into the contract with KRtec in the name of KRtec, after receiving a business registration certificate and having received a confirmation of the work site at a location likely to be presumed to be the location of the business site of KRte, and the Plaintiff appears to have entered into the contract with KRtec in the name of KRte, and the Plaintiff appears to have entered into the contract with KRte in the name of KRtec.

(B) According to the account details of the Plaintiff and the Plaintiff’s customer director, the Plaintiff is acknowledged to have deposited KRW 136,762,780, total contract amount including value-added tax, as shown in the attached Table 1, before and after the issuance of the instant tax invoice. Accordingly, the Defendant asserts that the Plaintiff and the other companies receiving the tax invoice from the Plaintiff, including the Plaintiff, have returned the false tax invoice amount in light of the circumstances of withdrawal or transfer on the day or on the day. However, there is no evidence suggesting that the Plaintiff has received the aforementioned withdrawal or transfer money again, and that the Plaintiff has received the said withdrawal or transfer money again, and that the Plaintiff has paid the subcontract price in cash without receiving the tax invoice from the subcontractor.

(C) NN, the wife of the Plaintiff and its representative director, was placed a new product from around November 2010 to April 2012, 201, and the Plaintiff directly performed the manufacturing process from the date of the order (the volume ordered by NN appears to have been repeated to the Plaintiff) to the date prior to the rewing work, and then contracted the rewing work to KS, and supplied the product to the ordering office after completing the finished work after delivery of the finished product. No circumstance was found to deem that the orders issued by the ordering office supporting the above order fact, the written order issued by the Plaintiff’s internal product, etc., and there is sufficient motive to conduct real transactions with KS to supply the product ordered by the Plaintiff.

(D) In the prosecutorial investigation, AA stated that “AAA has issued a tax invoice in the name of Ktech because the TPP was not registered as a business operator (Evidence 7 No. 21). On the basis of this, the prosecutor deemed that AA was indicted for violating the Punishment of Tax Evaders Act by deeming that the TPP, which is not Ktech, was issued a false tax invoice even though it was actually supplied with respect to the instant tax invoice.

However, it is difficult to readily conclude that AAAA has issued a tax invoice to the Plaintiff solely based on only the aforementioned statement, including stating that AAAP supplied goods under the contract to the Plaintiff at the time of the conclusion of the contract. Inasmuch as the Plaintiff recognized KR as a contracting party at the time of the conclusion of the contract, and stated that the transaction performance process, such as payment, etc. after the conclusion of the contract, was conducted in a relationship with KRA and the Plaintiff was given a subcontract to other companies and supplied the Plaintiff, it is difficult to conclude that the instant tax invoice was issued falsely without real transaction. Even if the actual supplier’s entry into the instant tax invoice is deemed as TPP, even if the actual supplier’s entry into the instant tax invoice was disguised, the Plaintiff’s business registration certificate and the contract site verification, etc., the details of the instant tax invoice, including value added tax, and the Plaintiff’s initial transaction performance process, such as payment, etc., after the conclusion of the contract, was conducted in a relationship with KRA and the Plaintiff’s initial sales tax authority did not know that the Plaintiff did not know that it was 2.

(E) As such, there are many circumstances to deem that the Plaintiff engaged in real transactions with the Plaintiff regarding the instant tax invoice, and in the relevant case, while investigating the authenticity of the tax invoice issued by the investigative agency to many companies that have traded the instant tax invoice over several years, it appears that the Plaintiff was indicted on the part of the Plaintiff on the basis of the criminal confession of the Plaintiff without sufficient investigation by the investigating agency. Therefore, there are special circumstances to deem that it is difficult to employ the determination of facts of the relevant judgment. Accordingly, in accordance with the principle of allocation of burden of proof, the Defendant, who is the tax authority, must prove that the instant tax invoice is “unlawful tax invoice” different from the instant case. In light of the aforementioned various circumstances, there is no evidence or circumstance (such as there is no sufficient evidence to support that the Plaintiff’s value added ratio is considerably lower than the average average of the types of business, or that it was subcontracted to another company by the Plaintiff).

3. Conclusion

Therefore, the claim of this case is justified, and it is so decided as per Disposition.