Early High Court Decision 2012J3183 (Law No. 19, 2012)

It is difficult to regard a tax invoice received from an enterprise which has engaged in typical data as a normal tax invoice.

It is difficult to regard tax invoices received from an enterprise which has conducted a typical act of receiving only tax invoices without real transactions as tax invoices under actual transactions.

Tax amount paid under Article 17 of the Value-Added Tax Act

2012 disposition of revocation of the imposition of value-added tax

AAA, Inc.

Head of the Pakistan Tax Office

July 9, 2013

September 10, 2013

1. On April 3, 2012, the part of the Defendant’s claim for revocation of additional tax OO in the imposition disposition of value-added tax for the first period of 2010 against the Plaintiff is dismissed.

2. The plaintiff's remaining claims are dismissed.

3. The costs of lawsuit shall be borne by the Plaintiff.

Cheong-gu Office

The imposition of value-added tax stated in paragraph (1) shall be revoked.

1. Details of the disposition;

A. From April 5, 2006, the Plaintiff is a corporation that runs a construction business and oil wholesale and retail business in O-Eup O-type 401-2.

B. In 2010, the Plaintiff received a supply price tax invoice from BB Energy Co., Ltd. (hereinafter “B Energy”) for the first taxable period of the value-added tax (hereinafter “the instant taxable period”), and completed the final tax return for the first taxable period of the value-added tax for 2010 after deducting the relevant input tax amount from the output tax amount.” (c) The head of the provincial tax office conducted a survey on the data on BB Energy from June 16, 2010 to November 22, 2010, and then confirmed the total amount of the sales tax invoice issued for 104 companies from the second taxable period of the value-added tax for the second taxable period of the value-added tax for the year 2009 to the first taxable period of the value-added tax for the first taxable period of the value-added tax for the second taxable period of the value-added tax for 209. The instant tax invoice was also included in the said subject matter.

D. On April 3, 2012, the Defendant notified the head of the Dobong Tax Office of the foregoing contents as taxation data, determined that the instant tax invoice constitutes a tax invoice written differently from the fact, and did not deduct the relevant input tax amount, and notified the Plaintiff of the correction and notification of the KRW 1,000 (including additional tax) of the value-added tax OO in 2010.

E. Meanwhile, on May 1, 2013, when the instant lawsuit was pending on May 1, 2013, the Defendant corrected the effect of reducing the portion of imposition of additional tax (hereinafter referred to as the “instant disposition”), and on the same day, notified the Plaintiff of an advance notice of additional tax on the principal tax of the first period of value-added tax in 2010, stating the type of and basis for calculation of additional tax, etc., in the instant disposition of imposition of additional tax on the said value-added tax (hereinafter referred to as the “instant disposition”). [Grounds for recognition], the Defendant did not dispute, each entry in Eul’s Nos. 1, 2, 5, and 6 (including each number), and the purport of the entire pleadings.

2. Whether the part of the lawsuit in this case seeking revocation of penalty tax is legitimate

As seen earlier, since the Defendant revoked the imposition of penalty tax on the principal tax of value-added tax on May 1, 2010, which was pending in the instant lawsuit on May 1, 2013, the part seeking revocation of the said imposition of penalty tax among the instant lawsuit is unlawful as there is no subject of revocation or there is no benefit seeking revocation.

3. Whether the instant disposition is lawful

A. The plaintiff's assertion

(1) Since the Plaintiff was supplied with oil from BB energy and was issued with the instant tax invoice, the instant tax invoice cannot be deemed to be a false tax invoice (Dispute 1).

(2) Even if the instant tax invoice is a tax invoice different from the fact, the instant tax invoice was issued after confirming both the certificate of registration for retail business of BB energy and the registration of business, and there was no special circumstance that there was no negligence on the part of the Plaintiff on the part of failing to know that BB energy was a person with a nominal title (Dispute 2).

(3) Article 81-4(2) of the Framework Act on National Taxes (amended by Act No. 11604, Jan. 1, 2013; hereinafter the same) provides that a tax authority may not conduct a reinvestigation on the same item of taxation and the same taxable period, except for certain cases. The Plaintiff was subject to a tax investigation on the grounds that the Plaintiff was issued with due energy, primary energy, and disguised tax invoices as stated in the evidence Nos. 8 and 9 (including additional numbers). As such, the Plaintiff violated the above provision, and the instant disposition imposed upon the instant tax investigation was also unlawful (Dispute 3).

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

(1) Key 1 Judgment

(A) Article 17(2)1 of the former Value-Added Tax Act (amended by Act No. 11129, Dec. 31, 201) provides that an input tax amount shall not be deducted from the output tax amount in cases where the entries of a tax invoice are different from the facts. It means that the entries of a tax invoice are different from the facts. In light of the purport of Article 14(1) of the Framework Act on National Taxes that provides that if a person to whom a tax invoice belongs actually belongs is the nominal ownership of income, profit, calculation, act, or transaction subject to taxation, and if there is another person to whom a tax invoice belongs, the person to whom the tax invoice actually belongs shall be a tax obligor and the relevant tax law shall apply. In light of the purport of Article 14(1) of the same Act, a case where the necessary entries of a tax invoice do not coincide with those of the parties to the transaction contract, etc. prepared between the parties to the goods or service, notwithstanding the formal descriptions of the relevant goods or service

(B) Fully considering the following circumstances as to the instant case’s health team, Eul’s evidence Nos. 2 through 4 and the overall purport of the arguments, namely, ① lack of capacity to supply oil under the instant tax invoice to the Plaintiff since the low oil facilities sentenced to BB energy was not actually used; ② BB energy was established as a corporation, and it was generated sales equivalent to KRW 00 million and deposited in a daily amount of money, and distributed in cash after transferring it to CC Energy, a newly incorporated corporation. ③ In the process of the investigation by the Dobong Head of the tax office, Eul, the representative of BB energy, did not have any actual oil stored in the name of BB energy, and it was not known that the supplier was in charge of the management, shipping slip, and issuance of tax invoices; ④ The Plaintiff’s assertion that the Plaintiff’s tax invoice constitutes a violation of the instant tax invoice as well as the Plaintiff’s tax invoice, regardless of whether there was any requisite data entered in the instant tax invoice as a result of the Plaintiff’s accusation.

(2) Key Judgment 2

(A) Unless there is any special circumstance that the actual supplier and the supplier on a tax invoice are unaware of the nominal name of the supplier, the actual supplier and the supplier on a tax invoice may not deduct or refund the input tax amount unless there is any negligence on the part of the supplier that he was unaware of the nominal name. The fact that the supplier was not negligent in not knowing the nominal name should be proved by the person who asserts the deduction or refund of the input tax amount (see, e.g., Supreme Court Decision 2002Du2277, Jun. 28, 2002). Furthermore, in light of the details of issuance and delivery of the tax invoice, the price of the goods or services provided, the specific route and process of the supply of the goods or services, etc., in which the actual supplier is the supplier, and if there was a circumstance that the beneficiary might have doubt as to the non-data of the supplier, the beneficiary’s business registration certificate, business facilities, etc., without confirming the supplier’s place of business or business, etc. on the nominal name, and confirming the sales statement, etc.

(B) With respect to the instant case, the evidence submitted by the Plaintiff alone is insufficient to acknowledge that the Plaintiff did not know the fact that the instant tax invoice delivered by the Plaintiff in purchasing oil from BB energy was a false tax invoice, and there is no other evidence to acknowledge it. Rather, it is not sufficient to acknowledge it. Rather, the following circumstances, which can be comprehensively taken into account the facts and the purport of the entire pleadings, i.e., the Plaintiff’s operation of the gas station from around 2006, would have been well known of the normal structure and distribution route of the oil supply, the general transaction type or method of the oil industry, the actual situation of transactions in the data, and the risk of the oil transaction. The shipping slip is an important material to prove that the oil transaction was conducted through normal distribution process. The most of the shipping slips submitted by the Plaintiff were not entirely indicated in the tank number, oil temperature and density, etc., which can confirm the normal distribution of oil, and the shipping slip was written as BB energy, and thus, if the Plaintiff paid a little amount, it is not reasonable to deem that the Plaintiff’s tax invoice was prepared.

(3) Key Judgment 3

(A) Article 81-4(2) of the Framework Act on National Taxes provides that a tax official shall not conduct a reinvestigation of the same item of tax and the same taxable period unless there is any clear evidence to acknowledge a suspicion of tax evasion, where it is necessary to conduct an investigation on the other party to the transaction, or where there is any error related to two or more business years, etc., and according to each description of the evidence Nos. 8 and 9 (including the paper number). According to each of the evidence No. 8 and 9 of the same item of tax, the period for the investigation alleged to be a overlapping tax investigation by the Plaintiff cannot be the same as the taxable period of this case since it is confirmed that the period for the investigation is from the first taxable period of value-added tax in 208 to the second taxable period of value-added tax in 209 ( September 30, 2009). Thus, it is difficult to deem that the tax investigation conducted by the Defendant separately related to the taxable period of this case separately from the above

4. Conclusion

Therefore, among the lawsuit of this case, the part demanding the revocation of the additional tax for the principal tax of value added tax of the first half of 2010 is unlawful, and it is dismissed, and the remaining claim of the plaintiff is dismissed as it is without merit. It is so decided as per Disposition.