Whether a tax invoice constitutes a false tax invoice (gold);

Since the instant transaction is merely a nominal transaction and cannot be deemed to have been transferred the actual ownership, the issue is that the tax invoice is prepared without a real transaction or is prepared differently from the actual transaction by at least the supplier, and constitutes a “tax invoice different from the actual transaction.”

Tax amount paid under Article 17 of the Value-Added Tax Act

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 value-added tax for the first term portion of October 20, 2002 against the Plaintiff on October 20, 2005 and KRW 517,685,490 for the second term portion of value-added tax on October 2002 is revoked.

1. Details of disposition;

A. The Plaintiff (the Plaintiff changed from ○○ Co., Ltd. on October 7, 2003) supplied gold bullion amounting to KRW 285 kilograms, KRW 3,821,264,276, and KRW 220 kilograms, KRW 286, and KRW 220 kilograms, KRW 2886,453,820 in the taxable period of the value-added tax on October 7, 2002, and each of the above gold bullion sales was not reported and paid under the Value-Added Tax Act.

B. On October 20, 2005, the Defendant imposed the Plaintiff the value-added tax of KRW 720,881,500 for the first term portion of value-added tax and value-added tax of KRW 517,685,490 for the second term portion of value-added tax on 2002 on the ground that the sales of gold bullion supplied by the Plaintiff to ○○, etc. are not subject to zero-rate tax (hereinafter “instant disposition”).

(A) Evidence No. 1-4, Evidence No. 1, and the purport of the whole pleadings)

2. The legality of disposition.

A. The plaintiff's assertion

(1) The Plaintiff received a lawful purchase confirmation, etc. issued by the head of a foreign exchange bank at the time of the transaction of the gold bullion in this case. Since the aforementioned purchase confirmation, etc. is lawfully issued, the requirement for applying zero-rate tax is met only by itself, and since there is any defect in the purchase confirmation, etc. or whether it has been actually exported at the time of the supply, the Plaintiff’s sales of the gold bullion in this case which is believed to be legitimate as a legitimate subject of zero-rate tax rate is apparent to be subject to zero-rate tax rate, and the Defendant’

(2) Although the Defendant, even if not, should deduct the input tax amount when imposing the value-added tax of this case, the Defendant imposed the instant disposition without deducting the Plaintiff’s input tax amount at all, and thus, the Defendant’s instant disposition was unlawful.

(b) Related statutes;

It is as shown in the attached Form.

(c) Fact of recognition;

(1) The Plaintiff’s transaction details, etc. of the gold bullion

(A) The details of the Plaintiff’s report on the first term and second term value added tax are as follows.

(unit:,000 won)

Sales

Purchase

Payment

Amount of tax

Jinay

GENERAL

zero Rate

Sub-committees

GENERAL

zero Rate

Sub-committees

202.1

79,982

4,651,526

5,431,508

780,490

3,999,993

4,780,483

6,497

202.2

2,886,453

2,886,453

2,937

2,880,585

2,883,522

-293

Consolidateds

79,982

7,537,979

8,317,961

783,427

6,880,578

7,664,005

6,204

(B) The Plaintiff’s specific details of transactions by the first and second transaction partners, etc. of the first and second transaction partners are as follows.

(i)purchase;

From March 15, 2002 to May 16, 2002, 90 kilograms from ○ on nine occasions.

From April 9, 2002 to June 7, 2002, 195 kilograms from ○○ commercial company on six occasions.

From September 25, 2002 to December 2, 2002, 140 kilograms from ○○ to 10 kilograms

From October 17, 2002 to October 25, 2002, 80 kilograms from ○ on two occasions.

(ii)Sales;

From March 15, 2002 to March 28, 2002 to ○○ on four occasions.

From April 8, 2002 to September 27, 2002 to ○○ on seven occasions.

From April 22, 2002 to May 7, 2002 to ○○ 75 kilograms on four occasions.

From May 29, 2002 to June 7, 2002 to ○○ on four occasions 120 kilograms

From October 17, 2002 to October 25, 2002 80 kilograms twice to ○○ on two occasions.

From October 17, 2002 to December 26, 2002 ○○ 110 kilograms over 10 kilograms

(unit:,000 won)

Taxation

Period

Admissions

Sing.

withdrawals

Purchase Agency

Purchase Price

Sales Office

Sales Amount

Exporter

Whether to export

202. 200

1 1

○

526,255

○

527,320

○

Domestic Sales

668,770

○

670,105

○

Domestic Sales

○○ Commercial

1,007,316

○

1,009,322

○ ○ Trade

Domestic Sales

1,611,304

○ ○ Trade

1,614,513

Sub-committees

3,813,645

3,821,260

202. 200

2. 2

○

399,217

○

400,017

○○ Commercial

Domestic Sales

○

395,717

○

396,517

○

Domestic Sales

644,957

646,290

○

Domestic Sales

○

1,440,691

○

1,443,628

○ ○ Trade

Domestic Sales

Sub-committees

2,880,582

2,886,452

Consolidateds

6,694,227

6,707,712

(C) On March 15, 2002 to December 26, 2002, the Plaintiff purchased gold bullion of 505 kilograms over 27 times, and sold the same quantity of gold bullion over 31 times. Of which 415 kilograms were directly sold on the date of purchase, and the remainder of 90 kilograms was also sold within 3 months as seen below.

1) 50 kilograms purchased on April 9, 2002: Sale on April 22, 2002 and 24.

2) On April 12, 2002: Sale on April 30, 2002 and May 7, 2002

3) 15 kilograms purchased on October 14, 2002: Sale on December 9, 2002 to March 26, 2002

(D) The gold bullion sold by the Plaintiff was sold within a short time by a domestic supplier.

(E) Unlike ordinary transactions, the Plaintiff received the sales amount on March 15, 2002 from ○○○○, a seller, and deposited the sales amount to ○○○, a purchaser, on the same day, and deposited the sales amount to 12:21 on the same day, and deposited the sales amount to the purchaser immediately after receiving the sales amount from ○○, a purchaser. In the event that the purchase amount was first paid to the purchaser, the sales amount was deposited in several installments.

(F) The Plaintiff, while trading gold bullion amounting to 7 billion won in total at the market price, did not present all documents related to the transportation of gold bullion, only stated that the representative director or employee transported gold bullion by himself/herself.

(G) On January 1 to 12, 2002, the Plaintiff purchased a total of KRW 6,694,234,679 and sold a total of KRW 6,707,718,102 for KRW 100 per money [13,483,423 won per money (i.e., trading difference, KRW 6,707,718,102 - KRW 6,694,234,679 won) ¡À5 kilograms (trade volume) ± 505 kilograms (trade volume) ± 2666.66 (Conversion of kilograms into money); hereinafter the same shall apply].

(h) If the gold bullion purchased and sold by the Plaintiff during the said period is calculated as a wholesale price in the market, the purchase amount was 7,017,849,122 won, and the sales amount was 7,404,649,065 won, and at least 22,79,938 won (=7,040,649,060 won - 7,017,849,122 won). The purchase amount was 169 won per money (=22,79,938 won ± 505 kilograms ± 505 kilograms) ± 266.666 won per money).

(i)in the case of gold bullion, the gold bullion, which is sealed with a domestic market price higher than the international market price, accounts for 66% of the domestic circulation volume, and accordingly, various changes, including the avoidance of value-added tax, are crossing to the price of gold bullion over which the price of gold bullion regularly imported has been sealed.

(j) The Plaintiff did not have any record of filing a tax-free sales report after mandatory provision of tax-free gold bullion wholesalers under Article 106-3(11) of the Restriction of Special Taxation Act, effective April 1, 2005.

(2) Purchase confirmation, etc.

(A) In full view of Article 11 of the Value-Added Tax Act, Article 24(2) of the former Enforcement Decree of the Value-Added Tax Act (amended by the Presidential Decree No. 17827, Dec. 30, 2002); Article 9-2(2) of the former Enforcement Decree of the Value-Added Tax Act (amended by the Ordinance of the Ministry of Finance and Economy No. 299, Jan. 25, 2003) in order for a business entity to be subjected to zero tax rate, the business entity must supply the goods by means of a local letter of credit or a purchase confirmation, and the said purchase confirmation must contain the supporting documents, such as the export letter of credit concerning the goods or services for export, its number, effective date, and shipment date, and all the purchase confirmations submitted by the Plaintiff are omitted from the requisite descriptions as follows (the Enforcement Rule of the Value-Added Tax Act did not require the aforementioned mandatory descriptions prior to the amendment by the Ordinance of the Ministry

1) Two out of the purchase confirmation 27 cases in which the applicant for the purchase is the Plaintiff (one of the evidence Nos. 2, 6, 12, 15, 30, 32, 38, 39, 45, 51, 53, and 55 respectively, and two of them (one of the evidence Nos. 2 and 12) are written on the effective date and the shipment date, and the remainder of 15 cases (one of the evidence Nos. 4, 8, 10, 13, 16, 18, 24, 26, 28, 34, 36, 41, 43, 47, 499) are written on the effective date and the shipment date, respectively.

2) 20 of the purchase confirmation certificate that the supplier becomes the plaintiff (one of the evidence Nos. 3, 5, 7, 9, 14, 17, 19, 20, 21, 22, 23, 25, 27, 29, 31, 33, 35, 37, 40, 46, each of the evidence Nos. 27, 29, 31, 33, 35, 37, 40, 46), among the 31 cases of purchase confirmation that the supplier becomes the plaintiff, is only the number in the underlying documents and the number column, and 11 (one of the evidence Nos. 11,42, 44, 52, 54, 56, 57, 58, and 59) is written on the effective date and the shipment date.

(B) In a case where an enterprise seeking export purchases gold bullion imports in a successive manner, each seller shall issue a divisional certificate proving the amount of customs duties, etc. issued by the head of the customs office to refund customs duties imposed on raw materials for export in accordance with the Act on Special Cases Concerning the Refund of Customs Duties, etc. Levied on Raw Materials for Export, and finally purchase gold bullion and submit a divisional certificate to the head of the competent customs office and the first gold bullion importer filed a refund of customs duties paid by the first gold bullion importer. The Plaintiff did not issue or issue a divisional certificate to ○○○, ○○, and ○○, and ○○, among the purchasing places of the purchase, among the essential documents for refund of the customs duties already paid.

(3) Circumstances of accusation and criminal punishment

(A) On September 30, 2005, ○○ on December 26, 2005, 2005, on December 3, 2004, 2004, ○○○ was accused of a violation of the Procedure for the Punishment of Tax Evaders Act on May 2, 2003, 2005 for ○○ trade on May 30, 2005.

(B) On January 12, 2007, ○○, ○○, ○○○, etc., who actually operated ○○ trade and ○○○, etc., were convicted of the crime of evading value-added tax through so-called so-called “shot business using gold bullion transactions” in collusion with ○○ Local Court, etc.

(C) The above judgment (No. 63 evidence) contains the following: (a) the sales of gold bullion purchased at zero tax rate by the ○○○ and the ○○○○○ through an in-depth, etc.; and (b) the so-called so-called so-called so-called so-called an enterprise that fails to pay the value-added tax and runs away; (c) the Plaintiff and ○○○ is an intentional enterprise that transfers gold bullion to the above-mentioned so-called so-called so-called

(4) Other

The Do○○○’s punishment, which is the Do○○’s punishment, was serving as the representative director of the Plaintiff on October 26, 2001 from October 26 to July 16, 2003, and the Do○○○, the Do○○’s wife, is the only director of the Plaintiff from October 17, 2003 to the present day.

(Evidence Nos. 1 to 8, Nos. 1 to 65, and the purport of the whole pleadings)

D. Determination

(1) As to whether the zero tax rate is applied

Unless there exist special circumstances, such as the fact that the current supplier supplied to a buyer does not affect the application of zero-rate tax rates to a seller, and that there is a defect in the process of issuing a purchase approval, the purchase approval issued by the head of a foreign exchange bank cannot be deemed as null and void a year, and the supply of goods under the purchase approval cannot be immediately excluded from the subject of zero-rate tax rate under the Value-Added Tax Act solely on the ground of such defect in the process of issuing a purchase approval, unless there are special circumstances such as the supplier of the goods knows that there is a defect in issuing a purchase approval (see, e.g., Supreme Court Decision 2005Du13735, Jan. 26, 20

However, in full view of the following facts, the Plaintiff traded the instant gold bullion in collusion with the purchaser, or was aware that there was a serious defect in issuing a false purchase certificate, and that the instant gold bullion was not actually exported. Therefore, the Plaintiff’s transaction of the instant gold bullion cannot be subject to zero tax rate.

(A) The Plaintiff’s failure to issue or receive a certificate of subdivision inevitably required for refund of customs duties under the Act on Special Cases Concerning the Refund of Customs Duties, etc. Levied on Raw Materials for Export is to waive the benefits of refund of customs duties arising from the instant gold bullion transaction, which appears to be due to the Plaintiff’s knowledge that the instant gold bullion would not be exported ultimately.

(B) The purchase confirmation is an important document that serves as the basis for applying the zero tax rate of value-added tax, but it is difficult to recognize the purchase confirmation of this case as a normal purchase confirmation due to the omission of some of the requisite entries.

(C) The fact that the gold bullion sold at zero tax rate by the Plaintiff was sold within a short time by the domestic authorities without exporting the gold bullion.

(D) In light of the Plaintiff’s transaction type of the instant gold bullion, payment method, delivery route of gold bullion, Plaintiff’s profit from the instant gold bullion transaction, etc., including the circumstances that the Plaintiff sold most of the gold bullion purchased on the same day, and most of the gold bullion were paid from the sales office, and paid it again to the purchaser, it appears that the Plaintiff performed not only the instant gold bullion transaction but also the Plaintiff’s role as an intermediary company to evade value-added tax pursuant to the gold bullion transaction.

(E) The fact that the seller and the purchaser do not make a direct transaction and does not find any particular reason to conduct a transaction through the Plaintiff.

(F) In collusion with ○○ Central District Court, ○○○, etc., which practically operated ○○ trade and ○○○○, was convicted of the crime of evading value-added tax by using gold bullion trade in collusion with ○○○○○○, etc., and on the above judgment, the fact that ○○, ○○, and ○○○, etc. was indicated as being used by ○○○ as an entity with ○ trade and ○○ as an entity with ○○, and ○○○,

(G) Most of the plaintiffs trading companies including ○○ Company accused of violating the Procedure for the Punishment of Tax Evaders Act

(h) The fact that the representative director or employee of the Plaintiff did not present all documents related to the transportation of the gold bullion of this case, claiming that he transported the gold bullion of this case on his own.

(i) In the case of gold bullion, the fact that: (a) gold bullion accounts for about 66% of the domestic circulation volume because the domestic market price is higher than the international market price; and (b) gold bullion transactions, such as the avoidance of value-added tax, are crossing to the price of gold bullion currently being imported.

(2) As to the assertion of input tax deduction

In calculating the amount of value-added tax, it is identical to the Plaintiff’s assertion that the input tax should be deducted from the output tax amount. However, the above input tax deduction is premised on the payment of the value-added tax to the purchaser, and there is no input tax amount to be deducted, since the Plaintiff only purchased the gold bullion through zero tax rate, and there is no fact that the value

Therefore, the Plaintiff’s assertion on the deduction of input tax amount is without merit.

3. Conclusion

Thus, the defendant's disposition of this case is legitimate, and the plaintiff's claim is dismissed as per Disposition.

Related Acts and subordinate statutes

Article 11 (Application of the Zero Tax Act)

(1) The zero tax rates shall apply to the supply of the following goods or services:

1. Exported goods;

2. Not more than the omission;

Article 17 (Payable Tax Amount)

(1) The amount of value-added taxes payable by an entrepreneur (hereinafter referred to as "paid tax amount") shall be the amount computed by deducting the tax amount under the following subparagraphs (hereinafter referred to as "purchase tax amount") from the tax amount on the goods and services supplied by him/her (hereinafter referred to as "sales tax amount"): Provided, That where an input tax amount exceeds the output tax amount, it shall be a refundable tax amount (hereinafter referred to

1. The tax amount for the supply of goods or services used or to be used for his own business;

2. The tax amount for the import of goods used or to be used for his own business; and

(2) The following input taxes shall not be deducted from the output tax amount:

1. An input tax amount in case where the list of the total tax invoice by customer is not submitted under Article 20 (1) and (2), or the input tax amount on the portion not entered or entered differently from the fact, in case where the whole or part of the registration numbers or supply values by transaction parties in the submitted list of the total tax invoice by customer is not entered or entered differently from the fact, excluding the input tax amount in such

1-2. An input tax amount, in case where the tax invoice as provided in Article 16 (1) and (3) is not delivered, or the whole or part of the matters to be entered under Article 16 (1) 1 through 4 (hereinafter referred to as a “necessary entry item”) is not entered or entered differently from the fact on the delivered tax invoice: Provided, That the input tax amount in such case as prescribed by the Presidential Decree shall be excluded;

2. An input tax amount for expenditure not directly related to the business.

3. An input tax amount on the purchase and maintenance of small nonbusiness automobiles;

3-2. The purchase tax amount related to the disbursement of the entertainment expenses and similar expenses as prescribed by the Presidential Decree;

4. The input tax amount related to the business of supplying goods or services exempted from the value-added tax (including the input tax amount related to investments) and the land-related purchase tax amount as prescribed by

5. The input tax amount prior to the registration as provided in Article 5 (1): Provided, That those as prescribed by the Presidential Decree shall be excluded.

(3) Not more than omitted.

Article 24 of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 17827 of Dec. 30, 2002) ○

(1) Exports provided for in Article 11 (1) 1 of the Act shall be as follows:

1. Shipping domestic goods (including the fishery products collected by Korean vessels) from a foreign country;

2. Omission;

(2) The exported goods under Article 11 (1) 1 of the Act shall be deemed to include the following goods:

1. Goods supplied by a businessman by means of a local letter of credit or a written confirmation of purchase;

2. Not more than the omission;

The former Enforcement Rule of the Value-Added Tax Act (amended by Ordinance of the Ministry of Finance and Economy No. 299 on January 25, 2003

Article 9-2 (Scope of Local Letters of Credit, etc.)

(1) omitted.

(2) The term "purchase confirmations under Article 24 (2) 1 of the Decree and Article 26 (1) 2-2 of the Decree means confirmations issued by the head of a foreign exchange bank under Articles 38-2 and 116 (14) of the Enforcement Decree of the Foreign Trade Act within 20 days after the end of the taxable period to which the time of supply for goods or services belongs, corresponding to a local letter of credit under paragraph (1) and stating the export letters of credit, etc., the serial number, effective date, date of shipment, etc.

Addenda No. 258, Apr. 12, 2002

Article 2 (Application Cases to Purchase Certificates, etc.)

(1) The amended provisions of Article 9-2 (2) shall apply to the first purchase confirmation after this Rule enters into force.

The former Enforcement Rule of the Value-Added Tax Act (amended by Ordinance of the Ministry of Finance and Economy No. 258 of April 12, 2002)

Article 9-2 Scope of Local Letter of Credit, etc.

(1) The term "local letter of credit referred to in Article 24 (2) 1 of the Decree and Article 26 (1) 2-2 of the Decree means a letter of credit issued by the head of a foreign exchange bank within 20 days after the end of the taxable period to which the time of supply for goods or services belongs, where an entrepreneur wishes to be supplied with raw materials for export or goods for export or goods for export or goods processing for export in

(2) A written approval for purchase under Article 24 (2) 1 of the Decree and Article 26 (1) 2-2 of the Decree means an approval issued by the head of a foreign exchange bank within 20 days after the end of the taxable period in which goods or services are supplied in accordance with a local letter of credit under paragraph (1).

General Rules 11-24-9 of the Value-Added Tax Act (goods supplied under a local letter of credit or written confirmation of purchase)

The zero tax rate shall apply to goods supplied under a local letter of credit or a written confirmation of purchase as prescribed by the Foreign Trade Act, regardless of whether such goods are used for the purpose of export after their supply.

The Refund of Customs Duties, etc. Levied on Raw Materials

Article 9 (Refund of Customs Duties, etc.)

(1) When goods are offered for export, etc., the head of a customs office shall refund customs duties, etc. levied on raw materials for export of the relevant imported goods within two years retroactively from the date

Article 13 (Fixed Amount Refund Rates Table)

(1) When the Commissioner of the Korea Customs Service deems it necessary to simplify the refund procedure of customs duties, etc. on export goods and export goods from small and medium enterprises which have special production processes, such as at least two products simultaneously produced from a single raw material for export, he/she may determine and publicly notify a fixed amount refund rates table by type of export goods on the basis