National Tax Service Review Corporation 201-0053 ( November 21, 2011)

It is the fact that the divided corporation does not bear the joint tax liability for the additional charges, etc. that occur or established after the division and merger.

The Plaintiff is jointly and severally liable to pay national taxes, additional dues, etc. imposed on the non-party corporation or the tax liability established prior to the merger by split-merger by the division of the electricity business sector of the non-party corporation. However, since additional dues and aggravated additional dues for the non-party corporation were incurred only by imposing and notifying the value-added tax after the merger by split-merger, the Plaintiff is not jointly liable to pay additional dues and increased additional dues.

Article 25 of the Framework Act on National Taxes

2012Guhap7444 Additional revocation of revocation of the disposition of revocation

XX Co., Ltd

The director of Gwangju Tax Office

August 16, 2012

September 13, 2012

1. On August 2, 2011, the Defendant’s imposition of value-added tax of KRW 000 on the first quarter of 2007 against the Plaintiff on August 2, 201 and the imposition of KRW 000 on the aggregate of the additional and increased additional taxes among the imposition of value-added tax of KRW 00 on the second quarter of 2007, respectively, shall be revoked.

2. The plaintiff's remaining claims are dismissed.

2. Of the litigation costs, 2/3 shall be borne by the Plaintiff, and the remainder by the Defendant, respectively.

The Defendant’s imposition of value-added tax for the first period of 2007 against the Plaintiff on August 2, 201 (including additional dues and increased additional dues of 000 won) and value-added tax for the second period of 2007 (including additional dues and increased additional dues of 00 won) shall be revoked.

1. Details of the disposition;

A. On February 5, 2008, the Plaintiff, a joint stock company that runs the electrical construction business, was absorbing and merged the business part of the electricity business part of the XX Construction Co., Ltd. (hereinafter referred to as " XX Construction") (hereinafter referred to as "merger after division of this case").

B. The Defendant: (a) determined the payment period on September 1, 2008 as of September 30, 2008; and (b) determined the payment period on September 5, 2009 as of September 30, 2009; and (c) determined the payment period on September 5, 2009 as of September 30, 2009 and notified the value-added tax on the second-term value-added tax for 2007. However, the relevant value-added tax was not paid as of December 31, 207.

C. After that, the Defendant discovered the fact that the Plaintiff was divided into XX construction and notified the Plaintiff on June 1, 201 that the Plaintiff was jointly and severally liable for the payment of the value-added tax for the first and second period portion of the value-added tax for the year 2007 in which XX construction was delinquent. On August 2, 2011, the Defendant imposed the value-added tax for the first period of the year 2007 (including additional dues and increased additional dues) and KRW 000 for the second period of the value-added tax for the year 2007 (including additional dues and increased additional dues) (hereinafter referred to as the “instant disposition”).

D. The Plaintiff dissatisfied with the instant disposition and filed a request for examination with the Commissioner of the National Tax Service on October 5, 201, but the Commissioner of the National Tax Service dismissed the Plaintiff’s request on November 21, 201.

[Ground of recognition] Facts without dispute, Gap evidence 2, 3, Eul evidence 1 and 2, the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiff's assertion

The Defendant merely notified the Plaintiff of the payment of value-added tax on September 1, 2008 and September 5, 2009, and notified the Plaintiff of the payment of the amount of unpaid customs duties (value-added tax, additional tax, and increased additional tax) during the period of August 2, 201. However, even if the Plaintiff is jointly and severally liable for the payment of XX construction, the Defendant should issue a separate duty payment notice to the Plaintiff, and the Plaintiff’s payment deadline is extended during the period of the Plaintiff’s failure to receive the duty payment notice. Nevertheless, the instant disposition that the Defendant later notified the Plaintiff of the payment notice to pay the additional tax during that period is unlawful.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Article 25(2) of the former Framework Act on National Taxes (amended by Act No. 8860 of Feb. 29, 2008; hereinafter the same) provides that where a corporation is divided or divided and merged, the corporation to be divided shall be jointly and severally liable to pay any national tax, additional dues, and expenses for disposition on default imposed on or before the date of division or a merger through division and merger with another corporation. Article 2 subparag. 1(g) of the former Framework Act on National Taxes defines value-added tax as national tax and Article 2 subparag. 5 of the former Framework Act defines the amount to be collected in addition to the amount to be collected in addition to the amount to be collected in addition to the amount to be collected in addition to the amount to be collected in accordance with the National Tax Collection Act and Article 21(1)7 of the former Framework Act provides that, in cases of value-added tax, the tax liability shall be established when the taxable period for value-added tax expires.

2) According to the above provisions, the Plaintiff is jointly obligated to pay national taxes, additional dues, and expenses for disposition on default on or before the date of division and merger by dividing the electricity business sector of XX into division and merger on or before February 5, 2008. The value-added tax for the first period of 2007 that the construction should pay is established on June 30, 2007, and on December 31, 2007, the value-added tax for the second period of 2007 was established on or after the end of each taxable period of December 31, 2007. However, the additional dues and aggravated additional dues for each of the above value-added tax for the first period of 207 and the additional dues for the second period of 2007 that the Defendant did not bear on September 1, 2008 (i.e., value-added tax for the second period of 207 and the additional dues for the second period of 2005.207.

Furthermore, the mutual solidarity relationship between persons jointly and severally liable for tax payment is not related to the performance of the tax obligation which is already determined and does not relate to the determination of the tax obligation itself. Even if a person jointly and severally liable for tax payment is jointly and severally liable for tax payment, each specific tax obligation needs to be individually determined and thus, a notice of disposition of imposition, which is a requirement for establishing specific tax liability, must be given to each person individually liable for tax payment. Therefore, even if a person jointly and severally liable for tax payment served a notice of tax payment to one of the persons jointly and severally liable for tax payment, it cannot be said that the other person was notified of the disposition for imposing additional tax and increased additional tax (see, e.g., Supreme Court Decision 96Da31697, Sept. 4, 1998).

3) Therefore, among the instant dispositions, the sum of the surcharge and increased surcharge for the first period portion of value added tax in 2007 and the surcharge and increased surcharge for the second period of value added tax in 2007 are deemed unlawful on the ground that the Plaintiff’s joint and several tax liability for it is based on the premise that the Plaintiff is jointly and severally liable.

3. Conclusion

Therefore, the plaintiff's claim is justified within the above scope of recognition, and the remaining claims are dismissed as it is without merit. It is so decided as per Disposition.