The lawsuit of this case has no interest in the lawsuit seeking its revocation

In order to avoid duplication of the deliberation and conflict with the determination of the same tax liability, the Plaintiff’s interest or need not be claimed until the cancellation of the instant disposition on the same tax amount.

Article 94 of the Income Tax Act: Scope of Transfer Income

2018Guhap133 Revocation of Disposition rejecting a claim for rectification

○ ○

○ Head of tax office

on January 29, 2018

on September 19, 2018

1. The instant lawsuit shall be dismissed.

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

Cheong-gu Office

The defendant's rejection disposition against the plaintiff on January 1, 2017 is revoked with regard to the reduction of KRW 200,482,830 for the transfer income tax belonging to the year 2015.

1. Details of the disposition;

(a) Reporting on capital gains tax for the taxable year 2015;

1) On January 14, 2015, the Plaintiff: (a) around January 14, 2015, each real estate listed in attached Table 1 List 1 Paragraph (1) (hereinafter “the Plaintiff”).

On May 31, 2015, the Plaintiff reported and paid KRW 3,703,304 of the transfer income tax for the taxable year 2015 with the transfer value of the instant cartel as KRW 1,444,50,000.

2) Around August 24, 2015, the Plaintiff transferred each real estate listed in attached Table 1 List 2 (hereinafter “instant real estate”) to ○○○○○, and on October 31, 2015, the Plaintiff returned the transfer value of the instant real estate to the Defendant KRW 500,000,000, and the acquisition value was KRW 514,013,620 to the Defendant for a preliminary return of KRW 2,102,043 for the taxable year 2015.

B. Tax investigation of 00 regional tax office and a disposition to increase or correct the defendant

1) From May 19, 2016 to July 22, 2016, the ○○ Regional Tax Office: (a) conducted an investigation of capital gains tax on the Plaintiff; and (b) deemed that the Plaintiff transferred the instant cartel to KRW 2,050,000,000.

The defendant was notified.

2) Accordingly, on September 1, 2016, the Defendant issued a disposition to correct and notify capital gains tax of KRW 232,782,725 to the Plaintiff for the taxable year 2015 (hereinafter “instant disposition for correction”).

C. Demand for reduction and Defendant’s rejection disposition

A. On January 5, 2017, it may be recognized that the Plaintiff refused to file a request for correction of the reduced amount of KRW 200,482,830 for the transfer income tax for the year 2015. Thus, this is obvious that it is a clerical error and correct as above.

1) On November 8, 2016, the Plaintiff filed a claim with the Defendant for correction of KRW 32,29,896, which reduced the transfer value of the instant real estate from KRW 152,00,000, not KRW 500,000 that was initially reported, to KRW 200,482,726, to KRW 200,830 for the taxable year 2015, on the ground that the transfer value of the instant real estate was merely KRW 152,00,00,000.

2) On January 5, 2017, the Defendant confirmed that the Plaintiff transferred the instant real estate to KRW 500,000,000 as a result of the investigation by the ○○ Regional Tax Office, and that the Plaintiff notified the Plaintiff of KRW 232,782,725 of the transfer income tax for the taxable year 2015, including the transfer income from the transfer of each of the instant real estate and the instant franchise, and thus, refused the Plaintiff’s request for reduction or correction on the ground that the correction cannot be made differently from the content of the investigation and decision by the ○○ Regional Tax Office (hereinafter “instant disposition”).

(d) Request for examination and appeal against the increase or correction disposition of this case;

1) On December 5, 2016, the Plaintiff dissatisfied with the instant disposition of increase and correction, filed an objection, and filed a request for examination with the Commissioner of the National Tax Service on March 31, 2017, but the Commissioner of the National Tax Service dismissed the Plaintiff’s request for examination on July 7, 2017.

2) On September 29, 2017, the Plaintiff filed a lawsuit against the Defendant seeking revocation of the instant disposition for rectification (this Court 2017Guhap********). This court dismissed the Plaintiff’s claim on June 27, 2018. Accordingly, the Plaintiff’s appeal is still pending in the appellate court (original court 2018Nu****).

E. Request for adjudication and appeal against the instant disposition

1) Meanwhile, on March 31, 2017, the Plaintiff appealed against the instant disposition and filed an appeal seeking revocation of the instant disposition with the Tax Tribunal, but the Tax Tribunal dismissed the Plaintiff’s appeal on November 6, 2017.

2) The Plaintiff appealed and filed the instant lawsuit on February 6, 2018.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1, Eul evidence Nos. 1, 11, 12, 20, 23 through 26 (including branch numbers; hereinafter the same shall apply) and the purport of the whole pleadings

2. Relevant statutes;

Attached Form 2 shall be as listed in attached Table 2.

3. Judgment on the main defense of this case

A. The defendant's argument

The Defendant asserted that the Plaintiff’s revocation lawsuit and the instant lawsuit are identical tax liability, and that the Plaintiff’s transfer value of the instant real estate is only KRW 152,00,000, as alleged in the instant case, can be determined by asserting that the transfer value of the instant real estate is only KRW 152,00,000, as alleged in the instant lawsuit against revocation of the instant disposition. Thus, the instant lawsuit asserts to the effect that it is unlawful as it does

B. Determination

In an appeal litigation seeking revocation of a disposition of increase in tax amount, whether the amount of tax exceeds a legitimate amount of tax, the determination of illegality of a disposition of increase in tax amount should be made on the basis of whether the initial reason for excessive reporting or the reason for taxing the tax authority’s revocation is an individual illegal reason supporting the illegality of the disposition of increase in tax amount (see Supreme Court Decision 2002Du9261, Aug. 16, 2004). In addition, in an appeal litigation seeking revocation of a disposition of increase in tax amount, a taxpayer may assert not only the reason for tax authorities’ increase in tax amount but also the reason for excessive reporting as to the initial report (see Supreme Court en banc Decision 2010Du11733, Apr. 18, 2013). In addition, in cases where a taxpayer files a lawsuit seeking revocation of a disposition of increase in tax amount identical to that of the same taxable period along with a lawsuit seeking revocation of a disposition of reduction in tax amount, barring special circumstances, the benefit or lawsuit seeking revocation of the same claim for revocation against the disposition of increase in tax amount.

With respect to the instant case, the Plaintiff filed a lawsuit seeking revocation of the instant increase disposition, separate from the instant lawsuit seeking revocation of the instant disposition, and pending a lawsuit. The instant disposition has the nature of the Plaintiff’s rejection disposition as to the instant increase disposition, as well as also has the nature of the taxation disposition on the transfer income tax for the taxable year 2015 by notifying the Plaintiff again as it is. Moreover, the ground for the instant increase disposition is that the transfer price of the instant real estate is KRW 500,000,000, and that the price of transfer of the instant real estate is KRW 2,0540,000,000. As such, the Plaintiff’s assertion that the transfer price of the instant real estate is KRW 152,00,000,000,000,0000, may not be asserted together in the lawsuit disputing the tax amount on the instant increase disposition. Accordingly, the Plaintiff need not seek revocation of the instant interest or disposition to avoid any conflict with the deliberation on the confirmation of the same tax liability.

Therefore, the instant lawsuit is unlawful as it has no benefit of lawsuit.

4. Conclusion

Therefore, since the lawsuit of this case is unlawful, it is decided to dismiss it. It is so decided as per Disposition.