Where the processing purchase amount and the processing sales amount have occurred in the same business year, the scope of the outflow;

The burden of proof that the processing purchase amount was not out of the company is the person who asserts it, and there is no evidence to prove that the processing purchase amount was appropriated as the provisional receipts, but it was treated as the provisional receipts at the time of the recovery of the processing sales, so the disposition of this case where the processing purchase amount was recognized as the representative is legitimate.

Article 67 of the Corporate Tax Act

1. All of the plaintiffs' claims are dismissed.

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

Cheong-gu Office

The part of the disposition imposing corporate tax on Plaintiff 00 on December 8, 2003, exceeding KRW 623,606,404 among the disposition imposing corporate tax on Plaintiff 695,303,710 on December 8, 2003, and the part of the disposition imposing global income tax on Plaintiff 00 on March 4, 2004 by Defendant 00, which exceeds KRW 582,940,152 among the disposition imposing global income tax on Plaintiff 100 on March 4, 2004.

1. Details of the disposition;

A. The plaintiff 00 corporation is a corporation that operates a building business, while the plaintiff 000 is the representative director of the plaintiff 00 corporation.

B. During the period from 2001 to 2002, Plaintiff 00: (a) received false purchase tax invoices equivalent to the supply price of KRW 4,451,738,583 ( KRW 776,220,000, KRW 3,675,518,583) from 21 companies outside of 00 construction mid-term to 2002; and (b) paid KRW 567,043,726 to 1 companies in 2002. In addition, Plaintiff 00 issued false sales tax invoices equivalent to KRW 2,085,00,000 for the supply price and received KRW 208,50,000 for that reason, without conducting business transactions.

C. As a result of the tax investigation on Plaintiff 00 Construction, the Director of the Regional Tax Office discovered the issuance and receipt of the above false tax invoice, notified the head of the tax office of Defendant 00 of the corporate tax and value-added tax data, while he notified the head of the tax office of Defendant 00 of the processing purchase (including value-added tax), 4,329,868,715 won (754,201,400 won, 3,575,6767,315 won (including value-added tax) less 567,043,726 won, which was paid as corporate tax and value-added tax, out of 4,896,912,441 won.

D. Accordingly, on December 8, 2003, the head of the tax office imposed the value-added tax on the Plaintiff 00 on December 2, 2001 for the Plaintiff 2, 127,106,020, 165,94,400 won in 2002, and the second period 160,618,030 won in 202, on December 1, 2002, on which the said processing sales amount was deducted from the value-added tax base and did not deduct the value-added tax from the output tax amount.

At the same time, the above processing sales imposed and notified the amount of value added tax, including value added tax, in the calculation of gross income, the amount of the processing sales, including value added tax, in the calculation of gross income, and the amount of the processing sales, including value added tax, in the calculation of deductible expenses, in the calculation of deductible expenses, the amount of the amount paid as corporate tax in the calculation of deductible expenses, in the calculation of deductible expenses, in the calculation of deductible expenses, and in the calculation of deductible expenses, 326,214,50 won of corporate tax in the year 2002, and 695,303,710 won of corporate tax in the year 202 (hereinafter "the first disposition").

E. In addition, on March 4, 2004, the director of the tax office imposed global income tax of KRW 407,275,850 for the year 2001, and global income tax of KRW 1,545,339,00 for the year 2002 on March 4, 2004 on the part of the director of the tax office having jurisdiction over the imposition and notification of KRW 1,545,339,00 for global income tax of KRW 1,545,39,00 for the year 202 (hereinafter "the second disposition").

[Reasons for Recognition] Unsatisfy, Gap evidence 1-1, Gap evidence 1-2, Gap evidence 1-2, Gap evidence 2-3, 5-4-1, Eul evidence 1-2, Eul evidence 2-1, 2-2, Eul evidence 4-1, 2, Eul evidence 5-7, the purport of the whole pleadings

2. Violation of the disposition of this case

A. The plaintiffs' assertion

(1) The amount of KRW 208,50,000, which was received from the other party when Plaintiff 00 Construction issued false sales tax invoices, is not the price for the issuance of false sales tax invoices, but the transaction collection amount of value-added tax. Since the transactional relationship corresponding to the sales tax invoice did not have the duty to collect the transaction since it was caused by a fraudulent transaction, the obligation to return to the other party should be included in the calculation of losses, although Defendant 00 Tax Office included the above amount in the calculation of losses, the instant disposition 1, which the above amount in the calculation of losses, should be revoked within the scope of exceeding the amount of KRW 623,

(2) The amount of processed purchase by Plaintiff 00 Construction’s false purchase tax invoice shall be accounted for as the amount of provisional receipts, and the amount of processed price pursuant to the processing purchase shall not be leaked, but shall be offset by the amount of processed price. Thus, although the amount of processed price less the amount of processed price from the amount of processed purchase should be disposed of as bonus to Plaintiff 00, it should be disposed of as the total amount of processed price, it shall be revoked illegally within the extent exceeding KRW 582,940,152 of the global income tax calculated by subtracting the total amount of processed price. In addition, even though Defendant 00, the withholding agent of the Plaintiff 00, should first notify the Plaintiff 00 of the change of the amount of income, it is unlawful to impose the comprehensive income tax on Plaintiff 2 without such procedure.

B. Relevant statutes

Ｏ 법인세법

Article 15 (Scope of Gross Income)

(1) The gross income shall be the amount of earnings generated by transactions which increase the net assets of the concerned corporation, except for capital input or financing and what is provided in this Act.

(3) Matters necessary for the scope and classification of profits under paragraph (1) shall be prescribed by Presidential Decree.

Article 19 (Scope of Losses)

(1) Deductible expenses shall be the amount of losses incurred by transactions which reduce the net assets of a corporation, excluding return of capital or financing, disposition of surplus funds, and what is provided for in this Act.

(2) The losses under the provisions of paragraph (1) shall be losses or expenses generated or spent in connection with the business of a corporation which are generally accepted as normal or directly related to profit, except as otherwise prescribed by this Act and other Acts and subordinate statutes.

(3) The losses under the provisions of paragraph (1) shall be losses or expenses that are issued or disbursed in connection with the business of a corporation which are generally accepted as normal or directly related to profit, except as otherwise prescribed by this Act and other Acts and subordinate statutes.

Article 66 (Settlement and Correction)

(2) Where a domestic corporation files a report under Article 60, 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 tax base and amount of corporate tax on the income

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

Article 67 (Disposition of Income)

In filing a report on the corporate tax base on the income for each business year under the provisions of Article 60, or in determining or revising the corporate tax base under the provisions of Article 66 or 69, the amount included in gross income shall be disposed of as bonus, dividend, other outflow from the company and internal reserve, etc. according to the person to whom it belongs,

Ｏ 법인세법 시행령 (2002. 12. 30. 대통령령 제17826호로 개정되기 전의 것)

Article 11 (Scope of Earnings)

Profit under Article 15 (1) of the Act shall mean that provided for in any of the following subparagraphs, except as otherwise provided for in the Act and this Decree:

1. Revenue amounts (including contract amounts, sales amounts and insurance premium amounts, but excluding sales overcharge amounts and sales discount amounts under the corporate accounting standards; hereinafter the same shall apply): Provided, That in the case of estimation under the provisions of the proviso of Article 6 (3) of the Act, the revenue amount from key money or rental deposit money from real estate rental shall be the amount calculated by applying the interest rate as determined by the Ordinance of the Ministry of Finance and Economy in consideration of the fixed deposit interest rate of financial institutions (hereinafter referred to as the

2. The amount of transferred assets (including one’s own stocks);

3. Property rental fees;

4. Assets evaluation marginal profit;

5. The value of assets received without compensation;

6. The reduced amount of liabilities due to the exemption from or expiration of debts;

7. The returned amount included in the calculation of losses;

8. The accumulated amount appropriated as losses without the disposition of profits.

9. Profits received by distribution based on capital transactions with a specially related person under the provisions of the items of Article 88 (1) 8; and

10. The amount of earnings other than those under subparagraphs 1 through 9 which have accrued or will accrue to the corporation.

Article 19 (Scope of Losses)

Losses under the provisions of Article 19 (1) of the Act shall be those under the provisions of the following subparagraphs, except as otherwise prescribed by the Act and this Decree:

1. The purchase value of raw materials of commodities or manufactured goods sold (not including purchase overcharge amounts and purchase discount amounts under corporate accounting standards) and incidental expenses;

2. The book value at the time of transfer of transferred assets;

3. Personnel expenses;

4. Repair expenses for fixed assets;

5. Depreciation costs of fixed assets;

6. Property rental expenses;

7. Interest on borrowings;

8. Bad debts (including outstanding amounts of value-added sales tax which cannot be recovered and which have not received a bad debts tax deduction under Article 17-2 of the Value-Added Tax Act);

9. Appraisal loss on the property;

10. Taxes and public imposts;

11. Membership fees paid to organizations made up of businessmen, other than juristic persons, or associations or partnerships registered with the competent administrative authority;

12. Prospecting expenses in the mining industry (including expenses for developing areas for prospecting);

13. The value of free medical treatment given by the medical treatment coupons or Saemaul medical treatment coupons as determined by the Minister of Health and Welfare;

13-2. The book value of surplus food which is donated free of charge by a domestic corporation that operates manufacturing, wholesale, or retail business of food and beverage items according to the Korea Standard Industrial Classification to the persons who are registered with the State or local governments as business operators of surplus food utilization or to the persons designated by such business operators of surplus food utilization (in such cases, the amount shall not be included in the contribution under the provisions of subparagraph 1 of Article 35);

14. Expenses for business-related overseas inspections and training;

15. Operating expenses for special classes or middle and high schools attached to industrial enterprises for working juveniles established under the Elementary and Secondary Education Act;

16. Book value or money or goods of treasury stocks contributed to the employee stock ownership association under the Framework Act on Worker’s Welfare;

17. Losses other than those under subparagraphs 1 through 16 which accrue or will accrue to the corporation.

Ｏ 소득세법 시행령(2005. 2. 19. 대통령령 제18705호로 개정되기 전의 것)

Article 192 (Fictitious Payment Date of Dividend, Prize and Other Incomes Obtained by Disposal of Income)

(1) When the head of a tax office or the director of a regional tax office determines or revises the corporate income amount under the Corporate Tax Act, he shall notify the corporation concerned by a notice of change in the income amount as prescribed by the Ordinance of the Ministry of Finance and Economy within 15 days from the date of the determination or correction of the corporate income amount: Provided, That where the location of the corporation concerned is not clear or it is impossible to serve the notice, or where the corporation concerned falls under the provisions of Article 86 (1) 1, 2 and 4 of the National Tax Collection Act, he shall notify the relevant stockholder and the resident who received the disposition of the bonus or other income

Ｏ 국세징수법

Article 86 (Disposal of Deficit)

(1) Where a taxpayer falls under any of the following subparagraphs, the head of a tax office may write off his/her losses:

1. Where the disposition for arrears is terminated, and the distributed money is short of paying the delinquent amount;

2. Where it falls under Article 85;

4. Where it is deemed that there is no possibility of collection as prescribed by the Presidential Decree.

Ｏ 국세징수법 시행령 (2006. 3. 29. 대통령령 제19422호로 개정되기 전의 것)

Article 83 (Disposal of Deficit)

(1) The disposal of deficit pursuant to the provisions of Article 86 (1) 4 of the Act shall be limited to the cases falling under any of the following subparagraphs:

1. In case it is turned out that the defaulter is missing or he does not have any property;

2. In case the delinquent company becomes exempt from the taxation liability pursuant to the provisions of Article 241 of the Company Reorganization Act; and

C. Determination

(1) As to the first disposition of this case

On the other hand, there is no dispute between the parties as to the fact that the sales tax invoice of KRW 2,085,00,000 issued by Plaintiff 00, was issued in falsity, not by the actual transaction. Thus, between Plaintiff 00 Construction and the other party to the issuance of the false sales tax invoice, there is no transaction relation from the beginning, and thus, there is no transaction relation between Plaintiff 00 Construction and the other party to the issuance of the false sales tax invoice. Therefore, the amount of KRW 208,50,000 received by Plaintiff 00 cannot be viewed as the amount of value-added tax collection in accordance with the transaction relation, and thus, Plaintiff 00 is not liable to return the above amount to the other party. In addition, there is no evidence to acknowledge that Plaintiff 00 Construction was actually returned, and even if it was actually returned, it cannot be deemed as deductible expenses under the Corporate Tax Act and the Enforcement Decree of the same Act. Thus, Plaintiff 200 Construction should be included in deductible expenses.

(2) As to the second disposition of this case

Plaintiff 00 asserted that the processing purchase amount by false purchase tax invoice was appropriated as the provisional receipts and processed sales amount by false purchase tax invoice, and that the processing sales amount by false purchase tax invoice was disposed of as the half of the provisional receipts. However, each of Gap 6-1, 2, and 4 stated as supporting the above stated evidence Eul 3 [No. 6-1, 2, and 4] cannot be trusted because it is inconsistent with Eul 3's deposit and reflect details, and otherwise there is no evidence proving that the plaintiffs included the processing purchase amount and processing sales amount in the provisional accounts. Thus, this part of the above assertion by the plaintiff 00 is without merit (or plaintiff 00 asserted that some of the particulars of provisional receipts entered in the ledger of the provisional accounts were made by the processing purchase amount and processing sales amount, and it is difficult for the plaintiff 1 to claim revocation of the disposition of this case as stated in the opinion of this case. The remaining items of provisional receipts were also issued by the witness's short-term loans or by omission in the account books, and thus it is obviously unlawful since each of Gap's evidence or evidence were not included (which were unlawful).

In addition, according to the statement in Eul evidence No. 8, since it is recognized that the plaintiff 00 construction is a non-property condition, the defendant 00 master secretary's notification to the plaintiff 00 construction without notifying the change of income amount to the plaintiff 100 construction under the proviso of Article 192 (1) of the Enforcement Decree of the Income Tax Act and Article 86 (1) 4 of the National Tax Collection Act cannot be deemed illegal. Thus, the plaintiff 00's assertion on this point is without merit.

3. Conclusion

Therefore, the plaintiffs' claim of this case is dismissed in entirety as it is without merit, and it is so decided as per Disposition.