The propriety of the disposition of the omission of sales after inclusion in gross income;

As seen above in the facts of recognition, the omitted amount of the sales of this case cannot be deemed as the gross income of the non-party company, and even if it is deemed as the gross income of the non-party company, since it was paid to the non-party company as construction expenses, it shall not be deemed that the non-party company used for its

Article 94-2 of the Enforcement Decree of the Corporate Tax Act

1. The Defendant’s imposition of global income tax of KRW 205,560,920 against the Plaintiff on August 11, 2003 shall be revoked.

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

Cheong-gu Office

A. The plaintiff's assertion

(1) In relation to the instant construction project, the former ○○ paid a portion of the instant construction work directly to the subcontractor from the construction cost of the instant subcontracted to the subcontractor. As such, the amount of the instant construction work omitted cannot be deemed as the gross income of the non-party company, and even if deemed as the gross income of the non-party company, it cannot be deemed that the amount was out of the company. Accordingly, the instant disposition that reported otherwise is unlawful.

(2) The plaintiff was registered as the representative director of the non-party company until July 27, 1998 on the corporate register, but did not participate in the management of the non-party company after September 26, 1997, and the disposition of this case was unlawful on the premise that the plaintiff actually operated the non-party company.

B. Relevant statutes

The former Corporate Tax Act (amended by Act No. 5581 of Dec. 28, 1999)

Article 9 (Income in Each Business Year)

(1) The income of a domestic corporation for each business year shall be the amount obtained by deducting the total amount of losses which will belong to the business year from the total amount of earnings which belongs or will belong to the business year.

(2) The term "gross income" in paragraph (1) means the amount of earnings generated by transactions which increase the net assets of the concerned corporation, except for capital input or financing and those provided for in this Act.

(3) The term "deductible expenses" in paragraph (1) means the amount of losses incurred by transactions which reduce the net assets of a corporation, except as otherwise provided for in this Act, such as refund of capital or shares, appropriation of surplus funds, and transactions

Article 32 (Settlement and Correction)

(1) The head of the district tax office having jurisdiction over the place of tax payment or the Commissioner of the competent Regional Tax Office shall determine the tax base and amount of corporate tax on the income of the relevant corporation for each business year.

(2) Where a domestic corporation makes a report under Article 26 falls under any of the following subparagraphs, the head of the district tax office having jurisdiction over the place of tax payment or the Commissioner of the competent Regional Tax Office shall correct the corporate tax base and

1. Where there are errors or omissions in the contents of the report;

(5) In filing a report on the tax base of corporate tax under Article 26, or determining or revising the tax base of corporate tax under paragraphs (1) through (4), the amount included in the calculation of earnings shall be disposed of as bonus, dividends, other outflow in company, reservation in company, etc. according to the person to whom the corporate tax is reverted,

Corporate Tax Act

Addenda (No. 5581, December 28, 1998)

Article 1 (Enforcement Date) This Act shall enter into force on January 1, 199.

Article 2 (General Application) This Act shall apply to the business year beginning for the first time after this Act enters into force.

The former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 15970 on December 31, 1998)

Article 94-2 (Disposition of Income)

(1) The amount included in the calculation of earnings under the provisions of Article 32 (5) of the Act shall be disposed of under the provisions of the following subparagraphs. The same shall apply to non-profit domestic corporations

1. Where the amount included in the calculation of earnings has clearly leaked out of the company, it shall be the bonus, dividend, other income, and other outflow from the disposal of profits as follows according to the person to whom it reverts: Provided, That where the accrual is unclear, it shall be deemed as accrual to the representative (where an executive who is an investor and a stockholder with a special relationship under Article 46-2 (3) together holds 30/100 or more of the total issued stocks or equity shares of the concerned corporation and actually controls the operation of the corporation, he shall be deemed the representative, and where a corporation is exempted from withholding taxes under the provisions of Articles 36 (5) and 40-5 (6) of the Regulation of Tax Reduction and Exemption Act and there is a separate person representing the concerned corporation among the directors who are investors, the reported person shall be the representative, and where there are 2 or more representatives, the actual representative; hereinafter the same shall apply):

(a) Where the person to whom it reverts is an investor (excluding an investor who is an executive officer), the amount shall be double the person to whom it reverts;

(b) If the person to whom it belongs is an officer or employee, it shall be the bonus to the person to whom it reverts;

(c) Where the person to whom it belongs is a corporation or an individual operating a business, it shall be other outflow from the company: Provided, That such divided profits constitute the income for each business year of a domestic corporation or a domestic place of business of a foreign corporation under the provisions of Article 56 of the Act, or the business income of a non-resident under the provisions of Article 13

(e) If the person to whom it belongs is a person other than those referred to in items (a) through (c), it shall be other income for the person to

Income Tax Act

Article 20 (Earned Income)

(1) Earned income shall be the following income generated during the relevant year:

1. Class A:

(c) Amount treated as a bonus under the Corporate Tax Act;

C. Determination

(1) Facts of recognition

On December 1990, three persons, including Nonparty ○○, ○○○, and ○○○○, etc., invested their own funds to establish the non-party company. After borrowing the funds from the Plaintiff, the Plaintiff was unable to repay the borrowed funds, and the Plaintiff transferred the funds to the Plaintiff and was appointed as the representative director of the non-party company on September 26, 1994.

(b) On September 197, 1997, the non-party company started construction after entering into a contract with the construction of this case by setting the construction amount of KRW 1,210,00,000, and the construction period from September 10, 1997 to May 30, 1998. However, with respect to the settlement of promissory notes worth KRW 550,000,000 for the total face value received from the former ○○○○, the Plaintiff notified that the construction would be suspended, and the construction payment that was paid by the former ○○○○○ by that time was entirely delivered to the Plaintiff.

The construction work of this case was conducted by the former ○○ and ○○ on or around June 1998 after the completion of the construction of the new building. In this process, the former ○○ paid the construction cost directly to the subcontractor or the subcontractor through ○○, while the latter did not pay the construction cost to the Plaintiff or the non-party company.

1, Gap evidence 7, 9, Gap evidence 8-9, 11, 15, Eul evidence 2-1, and the purport of the whole pleadings

(2) Determination

(A) If a corporation fails to enter its sales in an account book despite the fact of sales, the total amount omitted from sales shall be deemed to have been leaked out of the account book, except in extenuating circumstances. In such a case, the special circumstance that the omission in sales was not disclosed out of the account book shall be proved by the party asserting the omission in sales.

(B) However, as seen in the above facts, the payment of the sales revenue of this case to the non-party company or the plaintiff in relation to the construction payment of this case is entirely 50 million won of promissory note, and the above pre-○○○ was directly paid the construction cost to the subcontractor after the plaintiff notified that he would suspend the construction work of this case. In light of the above facts, it is difficult to regard the sales omission amount as the non-party company’s gross income and even if it is deemed as the construction cost as the non-party company’s gross income, it is not leaked because the non-party company used it for its business.

(C) Therefore, the Defendant’s instant disposition, which was based on the premise that the instant amount was leaked out of the company’s gross income, was unlawful without having to determine other issues.

3. Conclusion

Therefore, since the disposition of this case is unlawful, the plaintiff's claim of this case seeking its revocation is justified and it is so decided as per Disposition.