Plaintiff 1 and one other (Attorney Choi Young-young, Counsel for the plaintiff-appellant)

Head of Jeonju Customs Office

April 24, 2019

Jeonju District Court Decision 2016Guhap1766 Decided February 14, 2018

1. The part against the defendant in the judgment of the court of first instance against the plaintiff 1 shall be revoked.

2. The plaintiff 1's claim corresponding to the above cancellation part is dismissed.

3. The plaintiff 2's appeal is dismissed.

4. The total cost of the lawsuit between the plaintiff 1 and the defendant is borne by the plaintiff 1-, the plaintiff 2 and the defendant.

1. Purport of claim

A disposition to correct customs duties as stated in the attached Table 1 that the defendant issued against the plaintiffs shall be revoked.

2. Purport of appeal

A. Plaintiff 1

Among the judgment of the first instance, the part against Plaintiff 1, which orders cancellation under the judgment of the first instance, shall be revoked.

In the first place, the Defendant’s corrective disposition against the Plaintiff 1 on the attached list Nos. 1-1 through 1-6, 3-1 through 3-2, 3-7 through 3-13, 4-2, 5-1, 5-2, 5-10 through 5-12, and 5-18 on the respective customs adjustment disposition, on the attached list Nos. 3-3 through 3-6, 4-1, 4-3 through 4-13, 5-3 through 5-9, 5-13 through 5-17 on the attached list No. 1, and on the changed customs adjustment disposition on the Myeon lecture among the customs adjustment disposition on the attached list No. 1-7, 10,29,320 shall be revoked, respectively.

Preliminaryly, the part corresponding to the “tax amount” column in the “calculated Amount” column in the attached Table 3 and 4 of the Customs Correction Disposition in Attached Table 1, 1-1 through 1-5, 3-1 through 3-11, 4-1, 4-3 through 4-5, 4-7, 4-10, and 4-11 against the Plaintiff 1 shall be revoked.

B. Plaintiff 2

Of the judgment of the court of first instance, the part against Plaintiff 2 shall be revoked. Each disposition to correct customs duties listed in attached Table 1 Nos 2-1 through 2-14 against Plaintiff 2 shall be revoked.

C. Defendant

It is identical to the text of paragraphs 1 and 2.

1. Scope of the judgment of this court;

Of the instant lawsuit, the first instance court dismissed the claim for revocation with respect to the corrected portion during the course of the first instance trial (attached Table 3-3 through 3-6, 4-1, 4-3 through 4-13, 5-3 through 5-9, and 5-13 through 5-17 with respect to the corrected portion of the instant lawsuit (hereinafter “amount of additional tax” in attached Table 1) on the ground that the “amount of additional tax collected” in attached Table 2 among the disposition for rectification of customs duties has no interest in litigation, and dismissed the claim for the remainder of Plaintiff 1 and the claim of Plaintiff 2 from among the disposition for rectification of customs duties of KRW 146,342,310 listed in attached Table 1-7 on the grounds that there is no interest in litigation, and dismissed the aforementioned portion. Plaintiff 1 did not file an appeal with respect to the foregoing portion, and thus, excluded from the scope of this judgment.

2. Details of the disposition;

The reasoning for this part of this Court is as stated in Paragraph (1) of the reasoning of the judgment of the court of first instance. Thus, this part is cited in accordance with Article 8(2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act

3. Whether the remaining part of the instant disposition, excluding the correction of reduction, is legitimate (hereinafter “the remaining part of the instant disposition”).

A. The plaintiffs' assertion

The remaining dispositions of this case shall be revoked on the grounds that they are illegal for the following reasons.

1) At the time of each import declaration, the Plaintiffs reported the price actually paid to exporters at the time of each import declaration. The price of the plaintiffs' imported rivers is the Machisan Machisan, the price of which is lower than that of the Machisan. Some of which is not the Machisan, and the price was lower upon entering into a comprehensive contract with exporters on November 2013 and November 2014 (a single dry field contract) with the exporters to harvest them. Although the Defendant sufficiently explained this to the Defendant, it is unlawful to deny the return price of the plaintiffs on the grounds that there is a difference between the reported price of similar goods at the time of each import declaration.

2) Even if the reported price of this case does not fall under the actual transaction price, similar goods, which the Defendant based on the calculation of the dutiable value, are different from the Plaintiffs’ imported goods (hereinafter “the instant goods”), the place of production, variety, transaction terms, etc., and thus, are not similar goods, and thus, the remaining disposition of this case is unlawful.

At least, the Defendant’s customs value should be determined based on the transaction price of the tobacco farm and E company as the transaction price of similar goods with respect to the import declaration of the attached Forms 2 and 3 among the remaining dispositions of this case, and the portion corresponding to the “tax amount” of the attached Forms 3 and 4 is unlawful as it determined the customs value based on the transaction price of similar goods with a higher price.

(b) Related statutes;

Attached Table 5 shall be as stated in the relevant statutes.

C. Determination

1) Whether the setting aside of reported prices of the instant case is lawful

According to Article 30 of the Customs Act, the customs value of imported goods shall, in principle, be the transaction price adjusted by adding the amount determined by the Customs Act to the price actually paid or to be paid by a buyer for the goods sold for export to Korea (paragraph (1)); however, in cases prescribed by Presidential Decree where a person liable for duty payment files a dutiable value declaration based on a transaction price pursuant to paragraph (1) and where it is difficult to recognize such dutiable value as a dutiable value because the relevant dutiable value is substantially different from the transaction price of the goods of the same kind and quality or similar goods, etc., the person liable for duty payment may request the person liable for duty payment to submit materials proving that the reported price is the same as the fact (paragraph (4)), and where the person liable for duty payment fails to submit materials requested by the person liable for duty payment or it is difficult to recognize a dutiable value only by the submitted materials,

In addition, Article 24(1)1 of the former Enforcement Decree of the Customs Act (amended by Presidential Decree No. 26957, Feb. 5, 2016; hereinafter the same) provides that “where the head of a customs office may request the submission of data, the reported price of a taxpayer is significantly different from the price of the goods of the same kind and quality or similar goods,” and Article 24(1)3-2 provides that “where the reported price is the goods for which the international market price is not published, such as crude oil, minerals, and grains, etc., and where the reported price is a mountainous district of the imported goods investigated by the Commissioner of the Korea Customs Service or by a person designated by the Commissioner of the Korea Customs Service, and where it is difficult to recognize the reported price as the dutiable value, Article 24(3) of the Enforcement Decree of the Customs Act provides that “where it is difficult to specifically indicate the transaction relationship of the imported goods submitted by the taxpayer” (Article 24(1)1) and Article 24(2) of the Enforcement Decree of the Customs Act provides that “where there are reasonable grounds to suspect the reported the reported price.

In full view of the following circumstances that can be seen by adding the whole purport of the pleadings to the evidence mentioned above and the statements mentioned in Gap evidence Nos. 33, 40, 41, 54, 55, Eul evidence Nos. 1 through 5, 10 through 14, 16, and 18 (including the serial numbers), the plaintiffs' reported prices are considerably different from the transaction prices of similar goods, and it is difficult to recognize the reported prices as dutiable value because there are reasonable grounds to suspect the accuracy or truth of the reported prices. Thus, the plaintiffs' assertion that the defendant denied the reported prices is unlawful is without merit.

A) Of the reported prices in this case, the raw material price is 12-38% of the mountainous district price investigated by the Korea Agriculture and Fisheries Corporation, and the conversion price (CIF (the price including the fare and insurance premium of goods) of the instant reported price is 24-5% of the weighted average price of similar goods at the time of each import (the average price calculated by dividing the sum of net weight for each reported case x the sum of the unit price for each reported case x the sum of net weight for each reported case x 27-78% of the average price for each reported case) and 27-78% of the average price for the similar goods. The instant reported price is substantially different from the transaction price for the similar goods at the time of each import (including the transaction price for the similar goods, which was the basis of the correction on February 2, 2018).

B) Some of the goods of this case imported by the Plaintiffs appears to have no big difference in the face value of the face value of the face value of the face value of the face value. The Korea Customs Service does not distinguish the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of the face value of

C) The Plaintiffs asserts that it was imported of the Madsan River compared to that of the Madsan River. Considering that the Madsan River was imported of the Madsan River, it appears that it was less than that of the Madsan River. However, according to the Chinese business trip report (No. 3) conducted by the Korea Customs Service around April 2015 in order to respond to the methods of low-price reporting, such as reporting on the importation of the Mad delivery, it was difficult to view that the content of the Madsan River was higher than that of the Madsan River as the Madsan River was less than that of the Madsan River, and that the Magsan River was less than that of the Madsan River and the Magsan River were less than that of the Madsan River and that the Magsan River were less than that of the Magsan River and the Magsan River were less than that of the Magsan River that the Plaintiffs were found to have produced the Magsan River and the Magsan River.

[Attachment 1]

The contents of the table-type import declaration contained in the main text of this Act are collected in 1.24 p.m. D. 1.24 p.m. (the local trip of the Korea Customs Service) 82.3.24 p.m. (the local trip of the Korea Customs Service) the plaintiffs (the plaintiffs of this case 91.10.94 p.m. 94 p.m. (the plaintiff of this case) of the plaintiffs of the Dogsansansan 91.94 p.m. (the plaintiff of this case) (the plaintiffs of this case) of the plaintiffs of the Dogsansan 93.30.81 p.m. Dogsansansan 93 Apr. 89

(4) The plaintiffs asserted that, upon entering into a comprehensive contract with the exporters in November 2014, they could import 10 U.S. dollars more than 10 U.S. dollars more than 14 U.S. dollars more than 10 U.S. dollars more than 3 U.S. dollars more than 10 U.S. dollars more than 14 U.S. dollars more than 10 U.S. dollars more than 10 U.S. dollars 27 U.S. dollars more than 13 U.S. dollars 201. However, according to the following facts: (a) the plaintiffs were not 14 U.S. dollars and 10 U.S. dollars 20 U.S. dollars 14 U.S. dollars 201.

2) Whether the determination of dutiable value of the instant case is lawful

(a) Article 30(5) of the Customs Act provides for a dutiable value for the goods whose dutiable value is difficult to be recognized by the method provided for in Articles 31 through 35 without determination of their dutiable value. Article 31(1) of the Customs Act provides that the dutiable value shall be determined by the method provided for in Article 30(1) of the former Enforcement Decree of the Customs Act based on the transaction price of the goods of the same kind and quality as the fact that the dutiable value is recognized. Article 32(1) of the Customs Act provides that “If the dutiable value cannot be determined by the method provided for in Article 30 or 31 of the former Enforcement Decree of the Customs Act, the dutiable value of the goods shall be determined by the method provided for in Article 30(1) of the Customs Act, which is the same as that of the relevant goods produced in the country of production and delivery or for which no change in market conditions that affect their dutiable value before and after the date of shipment, and the price of the similar goods shall be determined by the same method as that of sale price.

As seen earlier, so long as it is legitimate to recognize the Plaintiffs’ declared price as the dutiable value, the dutiable value for the Plaintiffs’ imported goods shall be determined by the method prescribed in Articles 31 through 35 of the Customs Act pursuant to Article 30(5) of the Customs Act. However, since the Plaintiffs’ imported goods are agricultural products, there are considerable differences in the characteristics of the products depending on origin, sulfur, harvest time, storage conditions, and the current status of production, etc., and there are no data to verify the characteristics of the products that serve as the basis for identity with the Plaintiffs’ imported goods, the dutiable value shall not be determined by the method prescribed in Article 31 (Determination of Dutiable Value Based on Transaction Price of Goods of Same Kind and Quality) of the Customs Act, and the dutiable value shall be determined based on the transaction price of similar goods pursuant to Article 32 of the Customs Act. If there is no similar goods, the dutiable value shall be determined based on the domestic sale price pursuant to Article 33 of the Customs Act, and if there is no domestic sale price, the dutiable value shall be determined by applying Article 35 of the Customs Act.

B) As to each import declaration listed in the separate sheet Nos. 1-7 (import declaration No. 1 omitted; hereinafter “import declaration No. 1-7 import declaration”) with the exception of five tons in small river among the import declarations listed in the separate sheet No. 1-7 (hereinafter “import declaration No. 1-7 import declaration”), the Defendant is lawful to determine the lowest price among the prices of similar goods listed in the separate sheet No. 1 (the dutiable value for the import declaration listed in the separate sheet No. 2 list No. 1 reflected in the reduction decision in the separate sheet No. 2 list) as a similar goods, and the Han River as to the small river and the Myeon River as to the production of the goods of this case, which appears to have no change in market conditions or commercial practices that affect the price.

As to this, even if Plaintiff 1 denied the import declaration price and determined the dutiable value based on the transaction price of similar goods, the Defendant asserts that the “tax amount” portion in the “calculated amount” in the attached Table 4 of the Defendant’s Customs Correction Disposition is unlawful on the grounds that: (a) USD 883.04 (No. 12. 2) per ton, which is the transaction price of the same-sex child imported by E by another importer, is recognized as the transaction price in customs; and (b) the customs value is determined based on the same; and (c) the Defendant’s Customs Correction Disposition is unlawful.

을 제15호증의 기재에 변론 전체의 취지를 종합하면, E사가 2014. 4. 15. 입항한 산동성산 소강 24톤에 대하여 수입신고가격을 톤당 미화 883.04달러로 기재한 사실, 서울세관에서 E사의 수입생강에 대하여 2014. 9. 25.부터 2014. 10. 24.까지 세액심사를 실시하였는데, 당시 원고 1이 2014. 3. 16. 입항한 별지1 목록 순번 1-2의 신고가격(조정가격) 톤당 미화 629달러와 ОООООО사가 2014. 4. 5. 입항한 신고가격(조정가격) 톤당 미화 503달러에 대하여 세액심사가 진행 중이었는데도 이것들을 유사물품의 거래가격으로 보고 E사의 수입신고가격이 유사물품의 거래가격보다 더 높다는 이유로 2014. 11. 19. E사의 수입신고가격을 인정한 사실, 이후 원고 1이 수입한 별지1 목록 순번 1-2 기재 물품신고가격은 유사물품의 거래가격과 현저한 차이가 있는 등 과세가격으로 인정하기 곤란하다는 이유로 2015. 3. 13. 이 사건 처분을 통해 톤당 미화 1,318.67달러로 증액경정되고, ОООООО사가 수입한 물품 역시 마찬가지 이유로 2015. 2. 24. 톤당 미화 1,318달러로 증액경정된 사실이 인정된다.

According to the above facts, even if the transaction value of USD 883.04 per ton, which is exempt from taxation for the occupation and life of the E company imported by E in this case, is a substantial difference from the transaction price of other similar goods, and there is a reasonable ground to suspect the accuracy and truth of the declared price pursuant to Article 32(2) of the Customs Act, and thus, it should be excluded from the basic data for the determination of dutiable value. Therefore, in determining the dutiable value of the import declaration stated in [Attachment 1] Nos. 1-2 through 1-5, the Defendant’s failure to consider the import declaration price of E company as the transaction

In addition, Plaintiff 1 asserts that the import declaration price of the Myeongsan (US$ 369 through 380 per ton) stated in the attached table 3-1 to 3-11 is higher than the market price recognized for the Magsan mountain (US$ 340 per ton of the returned price on December 6, 2014 through January 15, 2015). As such, Plaintiff 1 asserts that, as a matter of course, the import declaration price of the Dagsan stated in the attached table 1-1, 4-3 through 4-5, 4-7, 4-10, and 4-11 ($ 519 through 524 per ton of the vessel), the import declaration price of the Dogsan imported at a similar time, and that the Defendant’s import declaration price of the Dogsan mountain was lower than the market price of each similar goods ($ 300 per ton of the returned tax amount).

Comprehensively taking account of the purport of the argument in Gap evidence No. 71, the duty imposition disposition by the head of Incheon Customs Office was revoked, deeming that it is difficult for the above court to recognize the declared price of the tobacco delivery as the dutiable value, and the duty imposition disposition by the head of Incheon Customs Office at least 30 U.S. dollars per ton with respect to the Han River which entered into the port from December 6, 2014 to January 15, 2015, respectively, and at least 700 U.S. dollars per ton with respect to the small river which entered the port from March 31, 2015 to April 11, 2015. However, in the case of Seoul High Court No. 2017Nu84503, the above court’s determination that it is difficult to recognize the declared price of the tobacco delivery as the dutiable value of the goods at least 1-100 U.S. customs clearance-1 customs clearance-1 customs clearance-2 customs clearance-3 customs clearance-1 customs clearance-type.

C) The Defendant, pursuant to Article 35 of the Customs Act, determined the dutiable value per ton constituted USD 2,466 per ton based on the Chinese mountainous district price for five tons among the import declarations (import declaration Nos. 1-7 (import declaration No. 1 omitted; hereinafter “1-7 import declarations”) listed in the attached Table 1-7 (hereinafter “1-7 import declarations”).

Article 32 (Determination of Dutiable Value based on Transaction Price of Similar Goods) of the Customs Act cannot be applied to Article 33 (Determination of Dutiable Value based on Domestic Sale Price) of the Customs Act, given that there is no similar goods imported between 30 days and 30 days before the date of entry into the import declaration pursuant to subparagraph 12 of Article 3-7. In addition, in order to apply Article 33 (Determination of Dutiable Value based on Domestic Sale Price) of the Customs Act, “the unit price of goods of the same kind and quality or similar goods in the same state as the imported goods are the same as the date of the import declaration or the import declaration on the imported goods, which is the greatest quantity of goods sold in the Republic of Korea to an unrelated person at the same time as the date of the import declaration or the import declaration on the imported goods, the unit price of goods sold in the Republic of Korea shall be calculated in accordance with the generally recognized accounting principles, and there is no other material to calculate the domestic sale price. In addition, in order to determine whether the dutiable value can be calculated based on Article 34(1) of the exporter.

Plaintiff 1 asserts that the dutiable value of DNA imported goods ought to be recognized as the transaction price of similar goods. According to each description of evidence Nos. 17, 26, and 27, D shall be determined as D, May 20, 2014, which is within 90 days from August 14, 2014, which is the date of entry into the import declaration of 1-7, and filed a declaration of 450 U.S. dollars per ton (import declaration No. 2 omitted). However, in the Incheon Customs, D, the said declaration price was denied at the Incheon Customs office, and as a result of the tax examination, it is at issue on Oct. 27, 2014, which is within 90 days before and after the date of entry into the imported goods, the unit price for converting the imported goods into the transaction price of D, which is the market price of the goods [Article 1, 319, No. 319, No. 3 omitted) of the Enforcement Decree of the Customs Act, Article 35(1) of the former Enforcement Decree of the Customs Act.

In full view of the following circumstances that can be known in addition to the purport of the argument as a whole, “transaction price of similar goods” in Article 32 of the Customs Act refers to the transaction price of similar goods where a price declared by an importer of similar goods as the transaction price under Article 30(1) of the Customs Act is recognized as the dutiable value by the tax authority, and it is reasonable to view that the dutiable value calculated by the tax authority pursuant to Articles 31 through 35 of the Customs Act is not included in the dutiable value of the importer’s refusal of the import declaration price. Therefore, the dutiable value of the D company calculated pursuant to Article 35 of the Customs Act without the recognition of the D company’s import declaration price is not included in the “transaction price of the similar goods whose dutiable value is recognized” in Article 32 of the Customs Act, and the Defendant’s import declaration of similar goods cannot be deemed lawful based on Article 35(1) and Article 32 of the Customs Act, Article 29 of the Enforcement Decree of the Customs Act, Article 7(1)2 of the former Enforcement Rule of the Customs Act.

(1) Article 30(1) of the Customs Act provides that “The dutiable value of imported goods shall be the transaction price adjusted by adding up the following amounts to the price actually paid or to be paid by a buyer for the goods sold to be exported to Korea.” Article 30(4) of the Customs Act provides that “Where a person liable for duty payment files a dutiable value return based on the transaction price pursuant to Article 30(1) of the Customs Act, such as that the dutiable value is substantially different from the transaction price of the goods of the same kind and quality or similar goods, and where it is difficult to recognize such dutiable value, as prescribed by Presidential Decree, he/she may require a person liable for duty payment to submit materials proving that the dutiable value is identical to the fact.” Article 32(1) provides that “If a dutiable value cannot be determined by the method provided for in Articles 30 and 31, the dutiable value shall be determined based on the transaction price of similar goods, the dutiable value of which is recognized as a dutiable value.”

② The method of determining dutiable value under Articles 30 through 35 of the Customs Act is based on the World Trade Organization (WTO) Customs Valuation Agreement in which Korea has acceded. Article 1(1) of the Customs Valuation Agreement provides that “The dutiable value of imported goods shall be the transaction value. The transaction value shall be the price actually paid or payable for the goods sold for the purpose of export to the country of import in accordance with Article 8 on the following terms.” This provision provides for the same method as that of Article 30(1) of the Customs Act. Article 3 of Annex I of the Customs Valuation Agreement provides that “The transaction value of similar goods for the purpose of Article 3” means the customs value adjusted in accordance with paragraphs (1)(b) and (2) of Article 1 of the Customs Valuation Agreement. Article 30(4) of the Customs Valuation Agreement provides that “The price of similar goods may be used as a comparable price if the relevant price is recognized by the customs authority, but this provision shall not apply where the price is still subject to examination or the final determination of the customs duty is a provisional condition.”

③ Article 26 of the Enforcement Decree of the Customs Act provides for the definition of “similar goods” but does not provide for the explicit definition of “transaction price,” but it is natural to interpret “transaction price” at the price actually paid or payable by the parties concerned. Article 32 of the Customs Act provides that “The transaction price of similar goods, the fact of which is recognized as the dutiable value,” rather than providing for “price of similar goods” or “price of similar goods,” and it does not seem to include cases where the tax authority determines the dutiable value due to the denial of the reported price of similar goods.

4. Conclusion

Therefore, all of the claims for cancellation of the remaining disposition of this case shall be dismissed as it is without merit. Since the part against plaintiff 1 in the judgment of the court of first instance against plaintiff 1 is unfair with a different conclusion, the part against the defendant among the part against plaintiff 1 in the judgment of first instance against the defendant is revoked, and the part against plaintiff 1 in the judgment of first instance against the plaintiff 2 in the judgment of first instance is dismissed, and it is so decided as per Disposition by the assent of all participating Justices on the appeal against plaintiff

[Attachment]

Judges Yellow Jin-gu (Presiding Judge) Kim Jong-young