A. Whether national taxes and additional dues to be paid by a corporation as a secondary taxpayer are included in “national taxes and additional dues imposed on or to be paid by the corporation” under Article 41 of the Framework Act on National Taxes (affirmative)

(b) Whether the transferee is liable to pay national taxes or additional dues imposed on the transferor after the business transfer (negative)

(a) If a corporation is a business transferee and becomes a secondary tax obligor for national taxes and additional dues for the business in question imposed on the business transferor in accordance with Article 41 of the Framework Act on National Taxes, the national taxes and additional dues imposed on the transferor shall also be included in the “national taxes and additional dues imposed on the corporation or imposed on the corporation by the corporation” where the oligopolistic stockholder of the corporation becomes the secondary tax obligor;

B. Article 41 of the same Act applies only to the national taxes already imposed at the time of the transfer or acquisition of the business, and thus, the transferee of the business becomes liable for secondary tax liability. As such, the transferee of the business cannot be held liable for secondary tax liability for national taxes imposed on the transferor after the transfer or acquisition of the business or additional dues on such national taxes.

(a)Article 41(a) of the Framework Act on National Taxes;

B. Supreme Court Decision 89Nu6723 delivered on December 26, 1989 (Gong1990,420) 90Nu1892 delivered on August 28, 1990 (Gong1990,2042) 91Nu899 delivered on November 26, 1991 (Gong192,357)

Plaintiff

The director of Namyang District Tax Office

Seoul High Court Decision 90Gu12245 delivered on May 14, 1992

All appeals are dismissed.

The costs of appeal shall be assessed against each party.

1. Judgment on the Plaintiff’s grounds of appeal

The judgment of the court below which held that the plaintiff is an oligopolistic shareholder under Article 39 subparagraph 2 of the Framework Act on National Taxes of the Hongma Industry Co., Ltd. (hereinafter referred to as the "Scarma") and Article 20 of the Enforcement Decree of the same Act shall be justified in light of the evidence relations stated by the court below, and the judgment of the court below shall be justified in light of the evidence relations, and it shall not be deemed that there was an error of law such as erroneous admission of facts

2. Determination on the grounds of appeal by the Defendant Litigation Performers

A. The court below held that since Article 39 of the Framework Act on National Taxes provides that the secondary tax liability shall be imposed or payable to a third party with a special relationship with the principal taxpayer to the extent of an amount not collectible by the principal taxpayer, the second tax liability shall be imposed on the third party with a secondary tax liability, "national tax imposed on the corporation or to be paid by the corporation" as national tax by an investor with the secondary tax liability means only the corporation with the main tax liability, and the national tax to be paid by the corporation as the secondary tax obligor shall not be included in "national tax" as provided in the above provision, and since the amount of value-added tax notified by the defendant to the plaintiff is not included in "national tax" as provided in the above provision, the second tax liability shall be imposed on the plaintiff as the main tax obligor, and the second tax liability shall be 3,024,690 won and additional tax 635,170 won, which is initially imposed on the non-party 1 and the second tax liability shall be imposed on the plaintiff as the second tax obligor with the second tax liability for the second tax payment obligation.

B. According to Article 39 of the Framework Act on National Taxes, where the property of a corporation is insufficient to cover national taxes, additional dues, and disposition fees for arrears imposed on or to be paid by the corporation, a person who falls under an oligopolistic stockholder prescribed in subparagraph 2 as of the date on which the liability to pay national taxes is established shall be subject to secondary tax liability for such shortage. In this case, as in the case of this case, if a corporation (Scarma) becomes liable for secondary tax liability for national taxes and additional dues on the pertinent business imposed on the transferor as a business transferee pursuant to Article 41 of the same Act, the national taxes and additional dues imposed on the transferor shall be deemed to be included in the "national taxes and additional dues imposed on or to be paid by the corporation" which is the second liability to pay national taxes and additional dues imposed on the corporation by the oligopolistic stockholder. Accordingly, the judgment of the court below that the national taxes and additional dues imposed on or to be paid by the corporation as the second taxpayer shall not be included in the "national taxes and additional dues imposed on the corporation."

C. However, since the transferee of a business takes the secondary tax liability pursuant to Article 41 of the Framework Act on National Taxes only for the national taxes already imposed after the transfer and acquisition of the business, it is the opinion that the transferee of the business cannot impose the secondary tax liability for the national taxes and the additional dues imposed on the transferor after the transfer and acquisition of the business cannot impose the secondary tax liability for the transferee of the business (see Supreme Court Decision 91Nu899 delivered on November 26, 191). According to related evidence and records, it is evident that the Defendant’s secondary tax liability for the tax year 198 imposed on the transferor of the business as the transferee of the business was notified after February 16, 1989, because it is apparent that the value-added tax for the second period of 198 was notified after the date of the transfer and acquisition of the business (it is apparent that the correction resolution and the notice of tax payment are clerical error and that it is not possible for the transferee to impose the additional tax for the second period after the transfer and acquisition of the business from the transferee.

Therefore, the lower court’s conclusion that the Defendant’s payment notice of the value-added tax and the additional dues thereof is unlawful to the Plaintiff, who is an oligopolistic shareholder of the Hongma, is justifiable, and the above error committed by the lower court cannot be deemed to have influenced the judgment, and thus, the argument cannot be accepted

3. Therefore, all appeals filed by the plaintiff and the defendant are dismissed, and the costs of appeal are assessed against the plaintiff and the defendant. It is so decided as per Disposition with the assent of all participating Justices.

Justices Yoon-young (Presiding Justice)