Since the contract for acquisition of management rights is concluded as the nominal owner of the contract and the receipt for payment is deemed to have been issued and the payment is reverted to the nominal owner, it is equivalent to other income

In light of the fact that a contract is entered into as the nominal owner of a contract for acquisition by transfer of management rights and that a receipt is issued for the price, a disposition imposed as other income is justifiable.

Article 14 of the Framework Act on National Taxes

2013Guhap10731 global income and revocation of such disposition

○ ○

○ Head of tax office

January 24, 2014

March 25, 2014

1. The plaintiff's claim is dismissed.

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

The Defendant’s imposition of global income tax of KRW 8,220,211,620 against the Plaintiff on October 11, 201 shall be revoked.

1. Details of the disposition;

A. From March 19, 2007 to July 6, 2007, the Plaintiff worked as a director of △△△△ Media Co., Ltd. (the trade name was changed to △△△△△△△△△ on July 6, 2007; hereinafter referred to as “non-party company”).

B. On February 14, 2007, the director of the regional tax office of 000 shares of the non-party company 2,399,90 shares of the non-party company from AA and BB (i.e., 1,399,90 shares from AA on February 9, 2007; 450,000 shares from BB on March 9, 2007 and 550,00 shares from March 15, 2007) and became the largest shareholder. On June 14, 2007, the director of the regional tax office entered into a management right agreement with the non-party company with CCC on acquisition of shares of the non-party company 2,39,90 shares from the non-party company (i.e., 1,399,900 shares from the non-party company's director and auditor; the plaintiff notified the non-party company of the price to the non-party company 100,000 won from the date 27.

C. Accordingly, on October 11, 201, the Defendant did not recognize the instant price as necessary expenses by deeming it as other income, and corrected and notified the Plaintiff of KRW 8,220,211,620 as global income tax for the year 2007 (hereinafter “instant disposition”).

D. The Plaintiff, who was dissatisfied with the instant disposition, filed a request for review on December 15, 201, but filed a request for review on the instant disposition:

On January 18, 2013, the Commissioner of the National Tax Service dismissed the plaintiff's request for examination.

[Ground of recognition] Facts without dispute, Gap evidence 1 to 4, Eul evidence 1 and 6, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

Around February 2007 and around March 3, 2007, DD acquired shares and management rights of the non-party company from AA and BB, a major shareholder of the non-party company, the Plaintiff signed and sealed DD's documents prepared at DD's request, and the Plaintiff did not participate in the process of entering into the contract or receiving money. Upon DD's request, the Plaintiff acquired the shares of the non-party company in the name of the Plaintiff, and issued new investment securities, treatment securities, and Korean investment securities, issued them with its identification card, and issued them with its identification number, and managed the above shares account directly using DD. In transferring management rights of the non-party company to CCC, the Plaintiff signed and sealed various documents, such as transfer contracts prepared in advance at DD's request, and even after DD received checks, the Plaintiff was not subject to the disposition of management rights of the non-party company's name transfer, and the Plaintiff was also subject to the disposition of management rights of the non-party company's name transfer or acquisition.

B. Relevant statutes

(1) The former Framework Act on National Taxes (amended by Act No. 8830 of Dec. 31, 2007)

Article 14 (Real Taxation) (1) If the ownership of income, profit, property, act or transaction subject to taxation is merely nominal, and there is another person to whom it actually belongs, the person to whom it actually belongs shall be the person to whom it actually belongs as a taxpayer and

(c) Fact of recognition;

(1) On February 9, 2007, the Plaintiff entered into a contract with AA to acquire shares and management rights for the non-party company with the following content.

AA(hereinafter referred to as "A") and the plaintiff (hereinafter referred to as "A") enter into a contract for acquisition of shares and management rights for the shares issued by the non-party company (hereinafter referred to as "○○ enterprise" or "company") (hereinafter referred to as "this contract") as follows:

Article 1 (Subject Matter of Transfer)

(1) The transferor Gap shall transfer to the transferee all rights, such as the management rights, voting rights, authorization and permission rights, etc. of the company and all incidental business (hereinafter referred to as "management rights"), which are issued by the company as of the contract date, and 1,39,900 shares with voting rights (hereinafter referred to as "stocks subject to transfer"), to the transferee.

Article 2 (Sales Price)

A transferee B shall pay the transferor A KRW 7,500,000,000 to the total purchase price for the share subject to transfer and the acquisition of management rights as follows:

(1) Contract deposit: The transferee B shall pay 2,000,000 won to the transferor A at the same time as this contract is concluded.

(2) The first intermediate payment: The transferee Eul shall pay the transferor Gap 4,000,000,000 won on February 9, 2007.

(3) The second part: The transferee Eul shall pay the transferor Gap KRW 700,000,000 to him/her on February 9, 2007.

(4) Any balance: A transferee B shall pay 800,000,000 won to A before the first business day of the general meeting of shareholders for taking over the management right under Article 5 (1).

Article 3 (Methods of Stock Transfer)

(1) Upon entering into this contract, the transferor A shall transfer all of the shares subject to transfer to the transferee B or to the person designated by the transferee B, and simultaneously complete the transfer procedure.

Article 5 (Plan for Acquisition of Management Rights)

(1) After entering into this contract, the transferor Gap shall convene a general meeting of shareholders of the company in accordance with normal procedures and appoint all officers and auditors designated by the transferee, and shall transfer all the management rights of the company to the transferee Eul.

(2) The transferor A shall, at the same time as this contract is concluded, submit to the transferee all the registrations of the company and resignations (a certificate of personal seal impression issued within the latest seven days) of non-registered management (director, auditor, adviser, adviser, etc.).

(2) On February 9, 2007, AA drafted a written confirmation of receipt of the acquisition price of stocks and management rights with the following contents.

Certificates of receipt of purchase price of stocks and management rights

Receiving Amount: 6,700,000,000

I confirm that the above amounts, such as down payment, the first intermediate payment, and the second intermediate payment, have been received in the following manner with regard to the acquisition of the shares and management rights in the issuance of the non-party company that entered into on February 9, 2007.

A. On December 13, 2006, KRW 3,200,000: The transferor Gap completed receipt from the transferee Eul with the cashier's checks.

B. On December 20, 2006, KRW 1,800,000: The transferor Gap completed receipt from the transferee Eul with the cashier's checks.

C. KRW 800,000,000 on January 17, 2007: It shall be received from the transferee B to the bank account of the transferor B.

D. On January 17, 2007, KRW 700,000: The transferor Gap received from the transferee Eul through the bank account of ○○○○○.

E. 200,000,000 won is received by offsetting it with the financial consulting service fee for the non-party company performed at the request of the transferor A.

(3) On June 14, 2007, the Plaintiff entered into a contract with CCC to acquire management rights for the non-party company with the following content.

The plaintiff (hereinafter referred to as "the transferor Gap") and CCC (hereinafter referred to as "A") enter into a contract with the non-party company (hereinafter referred to as "○○ enterprise" or "company") whose head office is in Chungcheongbuk-gun ○○○○ 605- XX(hereinafter referred to as "○○ enterprise") as follows:

Article 1 (Subject Matter of Transfer)

The transferor A transfers all rights, such as management rights, voting rights, and permission rights, and incidental business (hereinafter referred to as "management rights"), to the transferee B, and the transferee B acquires them from the transferor A.

Article 2 (Sales Price)

A transferee B shall pay the transferor A KRW 15,000,000,000 to the total purchase price for the acquisition of management rights as follows:

(1) Contract deposit: The transferee of the down payment shall be paid in cash to the transferor A not later than June 20, 2007.

(2) The first intermediate payment: The transferee B shall be paid in cash to the transferor A by June 25, 2007, in the first intermediate payment of KRW 3,000,000,000.

(3) The second part: The transferee Eul shall be paid in cash to the transferor A by July 3, 2007, the amount of KRW 2,000,000,000 for the second part.

(4) The third intermediate payment: The transferee B shall be paid in cash to the transferor A by September 28, 2007, the amount of KRW 8,100,000,000 for the third intermediate payment.

§ 3. (Transfer and Takeover of Management Rights)

(1) After the completion of the receipt of the second intermediate payment under Article 2-2, the transferor Party A shall appoint directors and auditors designated by the transferee at the special shareholders' meeting on July 6, 2007.

(2) Upon completion of the receipt of the second intermediate payment under Article 2-2, the transferor Party A is required to submit to the transferee a resignation of the registration director and auditor of the company.

Article 4 (Duties of Transferor)

(1) The transferor A shall make every effort to maintain normal management status immediately after the conclusion of this contract.

(3) The transferor Gap shall faithfully perform the following obligations requested by the transferee Eul in accordance with the regulations, instructions, and legitimate procedures of the supervisory agencies, and all civil, criminal, or damage arising in connection with such obligations shall be borne by the transferee in all cases and shall be held liable by the transferee:

(a) The resolution by the board of directors and public disclosure concerning the third party's certificate of private placement (the total amount of at least 45 billion won) by allocating the third party to which the transferee promotes;

Article 5 (Duties of Transferees)

(1) After the conclusion of this Agreement, the transferee B shall be responsible for and implement the following affairs:

(a) Preparation of a report on the capital increase or approval for the capital increase in Korea;

(b) Response to such supervisory agencies related to capital increase;

(c) Investor and financing business related to capital increase with such capital increase: not less than 45,000,000 won in total; and

D. The time of payment completion: July 4, 2007

Article 7 (Conditions for Closing Transactions)

(1) The payment of the total purchase price under Article 2 shall be completed.

(2) A third party distribution method referred to in Article 5 shall be completed by the relevant third party's stamp.

(3) A director or auditor designated by a transferee shall be appointed at a special general meeting of shareholders under Article 3.

(4) On June 14, 2007, the non-party company decided to hold a board of directors on June 14, 2007 to offer new shares to a third party designated by CCC for the purpose of allocating 1,290 won of registered ordinary shares to the third party.

(5) On July 6, 2007, Nonparty Company held a special general meeting of shareholders and appointed a person designated by CCC as a director and auditor of Nonparty Company.

(6) Of the instant payments, the Plaintiff issued to CCC a receipt of KRW 1,900,00,000, the first intermediate payment of KRW 3,000,000,000, and KRW 1,400,000, which is a part of the second intermediate payments, and the remainder of KRW 600,000,000,00 among the second intermediate payments, and KRW 8,100,00,000 among the remainder of the second intermediate payments.

(7) On September 6, 2011, EE had worked as a director at the non-party company as of September 6, 201. At the time, the representative director of the non-party company was FF but was actually exercising control over the management right of the company, the representative of the non-party company was the plaintiff.

(8) The Plaintiff asserted in the petition for review that the price of KRW 15 billion is not a honorarium for transfer of management rights, etc., and that “the Plaintiff was the largest shareholder of the non-party company at the time of acquisition of shares 2,39,900 shares of the non-party company (16.038%) from AA and BB on February 3, 2007, and that “the Plaintiff was the largest shareholder of the non-party company at the time of acquisition of shares,” and that “the Plaintiff was in the position of the representative director after the acquisition of shares, and was in the position of the director, the Plaintiff was the largest shareholder and the director at the time of actual control.”

[Ground of recognition] Facts without dispute, Gap evidence Nos. 5 through 12, Eul evidence Nos. 2 through 5 (including various numbers for each type of evidence), the purport of the whole pleadings

C. Determination

Article 14 of the Framework Act on National Taxes intends to impose a tax burden on a person who actually reverts, not a person who actually reverts income, so the ownership of income shall not be determined by the formal business name or legal relationship, but by the relationship of attribution of profits arising from actual business activities. Provided, That the burden of proving that there is a separate person who actually reverts income, not an external name, is the nominal owner (see Supreme Court Decision 86Nu635, Oct. 28, 1987).

In light of the following circumstances, i.e., (i) the Plaintiff was actually registered as a director of the non-party company on the corporate register; (ii) the Plaintiff entered into a contract with the non-party company on June 14, 2007 by offering new shares in accordance with the terms and conditions of the contract; (iii) the Plaintiff was appointed as an executive officer of the non-party company; (iv) the Plaintiff prepared a receipt for the payment of the management right and issued it to the CCC; and (v) the Plaintiff did not assert any assertion related to the necessary expenses in the request for the examination on the disposition of this case, and did not assert any assertion that the Plaintiff was only the nominal owner; (v) the Plaintiff asserted that the Plaintiff was the largest shareholder of the non-party company and the director; and (v) the Plaintiff did not support financial data on the statement of CCC, the statement of CCC or the flow of the management right of this case; and therefore, there is no evidence to acknowledge that the Plaintiff’s testimony and the non-party company’s acquisition of this case is legitimate.

3. Conclusion

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