early 209west340 ( October 31, 2010)

Since the ownership of overseas convertible bonds purchase funds is recognized by the Plaintiff itself, the shares disposal profits after conversion of shares shall be deemed to have accrued to the Plaintiff.

It is difficult to readily conclude that the subject of transactions in foreign convertible bonds or the subject of interest in disposal of stocks belongs to the Plaintiff, but it is reasonable to deem that the ownership of the foreign convertible bonds purchase fund belongs to the Plaintiff ultimately, since it is recognized by the Plaintiff through the complaint in the litigation procedure.

2010Guhap4429 global income and revocation of disposition

XX Kim

○ Head of tax office

May 24, 2011

June 30, 2011

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of imposition of global income tax of KRW 7,689,821,200 against the Plaintiff on May 1, 2009 shall be revoked.

1. Basic facts

A. Circumstances of the previous dispositions

(1) On March 22, 2002, 201, ○○○○ Co., Ltd. (hereinafter referred to as “Oplos”) purchased overseas convertible bonds equivalent to US$3 million from January 22, 2001 to February 20, 201, and converted the stock disposal profit, 15,46,19,030,030, which was acquired by selling stocks, to the head of the National Tax Service for corporate tax return. The representative director under the name of Splos is KimB, the Plaintiff’s representative director under the name of the Plaintiff, but the Plaintiff was the Plaintiff’s representative director KimB, but the Plaintiff was actually notified of the purport that the taxation data was to be the Plaintiff.

B. The head of ○○○ Tax Office notified the head of the Regional Tax Office of the pertinent taxation data from the head of the competent Regional Tax Office of △△△△, and notified the Plaintiff of the change in the amount of income on July 22, 2004, by including the above KRW 15,466,19,030 in the amount of corporate tax for the business year of 2001, and imposing corporate tax of KRW 7,511,125,210. On the other hand, deeming that the ownership of the above KRW 15,466,199,030 is unclear and that the actual representative of the XX is the Plaintiff, the head of the competent tax office disposes of the bonus as the person to whom the Plaintiff belongs, and notified the Plaintiff

C. Accordingly, the director of the BB tax office notified the above taxation data and notified the Plaintiff of the amount of KRW 14,692,889,084, out of the bonus disposal amount of KRW 15,466,19,036, which was calculated by adding the amount of KRW 126,837,92,92,965 to the amount of global income for which the return was filed in the year when the tax base is 126,837,92,920, and adding the amount of KRW 3,946,867,261 to the amount of the final tax, and then calculated the total amount of KRW 9,843,960,226,226, which was calculated by adding the amount of penalty tax to the amount of the final tax (hereinafter referred to as the “previous disposition”). On January 3, 2005, the Plaintiff notified the Plaintiff of the amount of global income tax amount of KRW 21,052,99.

B. Progress of appeal against the previous disposition

(1) On August 25, 2006, the Plaintiff sought the revocation of the previous disposition of this case as the court 2006Guhap30751, and purchased OO's overseas convertible bonds with the Plaintiff's funds, and only used the account under the name of xer opened in the KS securities for convenience. As such, the actual purchaser is the Plaintiff, and since the Plaintiff is also the subject to the ownership of the share disposal interest, the said share disposal interest belongs to the Plaintiff. As such, the person to whom the said share disposal interest belongs is deemed to be the xer, the said share disposal interest shall be deemed to be the 2001 business year of 201, and the Plaintiff’s bonus disposal to the Plaintiff is against the principle of substantial taxation, and was rendered a favorable judgment on June 28, 2007.

(2) The Seoul High Court (Seoul High Court 2007Nu20142) appealed from the above judgment. The plaintiff in the above appellate court 2000 million won : ① the company that closed its business after purchasing small-scale overseas convertible bonds from March 201, 201, and the purchaser of the above overseas convertible bonds is also the plaintiff who was introduced by thisA and used the accounts in the name of KS 200. However, the party who acquired the above overseas convertible bonds for the convenience of trading can also be deemed as the plaintiff, and the above shares disposal interest belongs to the above NA 100. 2. 4.1 billion won, which was used to acquire the above AO 200,000,000,000 won, should be excluded from the above 30,000,000,000,000,000 won, which was 20,000,000 won.

(3) On September 25, 2008, the Supreme Court dismissed the appeal under Articles 4 and 5 of the former Act on Special Cases Concerning the Procedure for Appeal (wholly amended by Act No. 9816, Nov. 2, 2009). The above judgment became final and conclusive around that time.

C. Circumstances of the instant disposition

(1) According to the above Supreme Court decision, the head of ○○ Tax Office revised the resolution of the corporate tax of XXP, which forms the basis of the disposition of the instant case, changed the content of the notice of change in the amount of income from recognizing to other income and notified the Defendant having jurisdiction over the Plaintiff’s domicile.

(2) Accordingly, the defendant notified of the above taxation data and confirmed 15,46,19,036 won of the stock disposal profits of this case as other income without necessary expenses, and then notified 15,580,436,956 won after deducting income deduction amounting to 5,394,590 won from 15,575,042,366 won after deducting income deduction amounting to 15,577,046 won from global income reported in the year to which the pertinent taxation data were reverted, and added additional tax 1,504,457,260 won to the amount of the final tax, 7,711,474,206 won to the plaintiff on May 1, 2009 (hereinafter referred to as "the disposition of this case").

(3) On July 31, 2009, the Plaintiff appealed with the Tax Tribunal, but the Director dismissed the said appeal on August 31, 2010.

[Recognitions: Facts without dispute; Evidence Nos. 1 through 5; Statements No. 1 through 3; Purport of the whole pleadings]

2. Whether the disposition is lawful;

A. Summary of the plaintiff's assertion

The defendant's disposition of this case is unlawful for the following reasons.

(1) According to Article 26-2(1)3 of the Framework Act on National Taxes, in the case of global income tax, the exclusion period for imposition is five years, and the instant disposition on the income reverted to year 2001 was made after the exclusion period for imposition was set.

(2) Although the tax base of the instant disposition was determined as KRW 15,575,042,366, it was unjustly excessive, and there is no basis to recognize it, there is no error in the calculation of the tax base.

(3) In order to recognize the Plaintiff’s other income pursuant to Article 106(1)1(d) of the former Enforcement Decree of the Corporate Tax Act, the Defendant must prove that the Plaintiff’s profits from the disposal of shares 15,466,199,030 won were reverted to the Plaintiff. In the previous disposition of this case, the head of BB Tax Office seems to have known that the initial profits from the disposal of shares 15,466,19,030 won were reverted to the Plaintiff. In addition, the following circumstances recognized in the Seoul High Court Decision 2007Nu20142, supra, were as follows: (i) a significant portion of the proceeds from the disposal of shares transferred to a third party, such as OO, △△△, and △△△△, were transferred to a third party in the form of P Ppller’s account; and (ii) a considerable portion of the proceeds from the disposal of shares was reverted to the Plaintiff even if the land and buildings acquired more than 3 billion won at the price after the above trading.

(b) Related statutes;

It is as shown in the attached Form.

C. Determination

(1) As to the exclusion period

(A) The special exclusion period stipulated in Article 26-2 (2) 1 of the former Framework Act on National Taxes (amended by Act No. 9911, Jan. 1, 2010; hereinafter "former Framework Act on National Taxes") is once the exclusion period under Article 26-2 (1) of the same Act expires, the taxation right holder is unable to make any disposition, such as a new decision or decision of increase, as well as a decision of increase, when the exclusion period expires, such as a decision of reduction, due to the prolonged delay in the litigation procedure such as a request for administrative appeal or administrative litigation, etc. against a taxation disposition, which is made after the exclusion period has expired, in light of the fact that it has been established to prevent an unreasonable case from which the disposition cannot be taken in accordance with the judgment, etc., the taxation right holder can only make a decision of correction in accordance with the relevant judgment, etc., and a new decision of increase that does not comply with the relevant judgment can not be deemed to have been permitted until the new decision of increase is made within one year after the judgment, etc.

(B) In light of the above facts, when the judgment revoking the previous disposition of this case became final and conclusive, the defendant issued the previous disposition of this case on May 1, 2009, which was clearly 1 year later, and the above Seoul High Court Decision 2007Nu20142 decided that the tax authority can dispose of the plaintiff as other income by applying Article 106 (1) 1 (d) of the former Enforcement Decree of the Corporate Tax Act to the plaintiff, except that the plaintiff can be treated as an officer or employee by applying Article 106 (1) 1 (d) of the former Enforcement Decree of the Corporate Tax Act. Thus, the previous disposition of this case pointed out that the previous disposition of this case was unlawful by deeming the plaintiff as an officer or employee and recognizing the outflow income of the plaintiff as a bonus. Unlike the previous disposition of this case, it was calculated as other income under Article 106 (1) 1 (d) of the former Enforcement Decree of the Corporate Tax Act, and it constitutes a disposition of exclusion under Article 26-2 (2) 1 (d) of the former Enforcement Decree of the Framework Act.

(C) Therefore, the Plaintiff’s assertion on this part is without merit.

(2) As to the illegality of calculating the tax base

In light of the background leading up to the previous disposition of this case, the progress of appeal litigation therefor, and the circumstances leading up to the disposition of this case, the tax base of the disposition of this case is to be deemed to have been lawfully calculated by aggregating the amount of labor income reported based on the profits of xpus’s stock disposal and interest income amount, and there is no reason to deem otherwise excessive. Thus, the Plaintiff’s assertion on this part is without merit, as there is no reason to deem otherwise.

(3) As to the attribution of stock disposal profit

(A) Generally, the burden of proving the facts in a lawsuit seeking the revocation of the disposition imposing tax shall be deemed to have the imposing authority, but if it is revealed that the facts alleged in light of the empirical rule in the course of a specific lawsuit are presumed to have been in fact-finding, it cannot be readily concluded that the other party is an unlawful disposition that failed to meet the taxation requirements, unless it proves the circumstances that the pertinent facts in question cannot be eligible for the application of the empirical rule (see, e.g., Supreme Court Decisions 2003Du14284, Apr. 27, 2004). As such, the issue of whether the amount leaked from the corporation, such as XXpl, belongs to a specific person in fact-finding, and what kind of actual income falls under the category of income, is basically a matter of fact-finding to be determined by the free trial of the fact-finding court (see, e.g., Supreme Court Decisions 97Nu2429, Oct. 24, 199; 26Nu456, Dec. 26, 1997).

(B) According to the above facts and evidence, it is clear that the Plaintiff’s disposal of shares was 15,46,19,030 won out of the company under the above 20th judgment based on the premise that the Plaintiff’s disposal of shares was 60 million won or less, and that the Plaintiff’s disposal of shares was 60 million won or less in the above 2nd judgment based on the premise that the Plaintiff’s disposal of shares was 10 billion won or less in the above 2nd judgment, and that the Plaintiff’s disposal of shares was 10 billion won or less in the above 2nd judgment based on the premise that the Plaintiff’s disposal of shares was 60 billion won or more in the above 3nd judgment, and that the Plaintiff’s disposal of shares was 10 billion won or more in the above 2nd judgment based on the premise that the Plaintiff’s disposal of shares was 10 billion won or more in the above 3nd judgment, but the Plaintiff’s assertion that the above disposal of shares was 60 billion won or more in the above 2nd judgment.

(C) Therefore, the Plaintiff’s assertion on this part is without merit.

3. Conclusion

Thus, the plaintiff's claim is dismissed as it is without merit.