Seoul High Court 2010No565 (2010.08.06)

An actor, such as the representative of a corporation, can be a criminal subject of tax evasion, separate from a taxpayer.

An actor, such as a representative of a corporation, or an agent, employee, or other servant of a corporation, may be a criminal subject of a tax evasion, separate from a taxpayer, and constitutes "Fraud or other unlawful act where he/she evades a constructive gift tax by hiding "the fact of a gift of borrowed stocks between his/her children in a special relationship with the largest shareholder", and there is a constructive gift tax evasion through a merger.

Article 9 of the former Punishment of Tax Evaders Act

Article 41-5 of the former Inheritance Tax and Gift Tax Act

[1] An actor, such as a representative of a corporation, an agent, employee, or other employee of a corporation or an individual under Article 3 of the former Punishment of Tax Evaders Act (wholly amended by Act No. 9919, Jan. 1, 2010; hereinafter referred to as the “former Punishment of Tax Evaders Act”), may be a criminal subject of a crime of tax evasion, separate from a taxpayer under Article 9(1) of the former Punishment of Tax Evaders Act. Thus, the amount of tax evaded by the offender as a principal subject of tax evasion should be calculated on the basis of “offender, not a taxpayer.”

[2] Where the Government cannot determine or investigate and determine the tax base of the pertinent tax item due to a taxpayer’s failure to file a tax base return under the Act for the purpose of tax evasion, the tax evasion crime remains final and conclusive (Article 9-3 subparag. 1 of the former Punishment of Tax Evaders Act, which was wholly amended by Act No. 9919, Jan. 1, 2010). The circumstances that the government made a decision on taxation after the completion of the crime or the taxpayer paid all or part of the evaded tax amount do not affect the establishment of the crime.

[3] In a case where the Defendant was indicted on charges of violating the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by Act No. 9919, Jan. 1, 2010; hereinafter referred to as the "former Act on the Aggravated Punishment, etc.") on the grounds that he evaded gift tax by means of not reporting the tax base or the amount of gift tax imposed on his own children as his agent even though the Defendant donated the borrowed stocks to his own children, the case affirming the judgment below which held that the Defendant could not deduct the amount of evaded gift tax from the amount of gift tax, even if the Defendant’s child paid part of gift tax after the period for filing the gift tax had expired, by calculating the “amount of evaded tax as an actor under Article 3 of the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by Act No. 9919, Jan. 1, 2010) by adding all the amount of evaded tax by his child.

[4] "Fraud or other unlawful act" under Article 9 (1) of the former Punishment of Tax Evaders Act (wholly amended by Act No. 9919, Jan. 1, 2010) refers to a deceptive scheme or other unlawful act that makes it impossible or considerably difficult to impose and collect taxes.

[5] The case affirming the judgment below holding that in case where the defendant's act of evading constructive gift tax by concealing "the fact of donation of borrowed stocks between the largest shareholder and children in a special relationship with the defendant" under Article 41-5 (1) of the former Inheritance Tax and Gift Tax Act, which is the premise of imposing constructive gift tax by creating appearance such as the actual transaction between his children and the next shareholders even though the defendant donated the borrowed stocks to his own children, the act of the defendant constitutes "Fraud or other unlawful act in relation to the intentional gift tax evasion"

[6] In the crime of tax evasion, a person liable for tax evasion or an actor under Article 3 of the former Punishment of Tax Evaders Act (wholly amended by Act No. 9919, Jan. 1, 2010; hereinafter “former Punishment of Tax Evaders Act”) is recognized as constituting “Fraud or other unlawful act,” and thus, if a person commits or attempts to commit an unlawful act while recognizing the fact that the occurrence of a consequence of tax evasion, he/she shall be recognized as a crime of tax evasion. This legal principle applies to the constructive gift tax evasion crime under Article 41-5 of the former Inheritance Tax and Gift Tax Act (wholly amended by Act No. 7010, Dec. 30, 2003). Therefore, in order to constitute a crime of tax evasion, it is necessary to recognize that the subject of tax evasion under the former Punishment of Tax Evaders Act makes it impossible or considerably difficult for him/her to impose and collect taxes, or that it would result in a crime of tax evasion due to his/her unlawful act in consideration of the profits such as listing upon the merger, etc.

[7] In a case where the Defendant was prosecuted for violation of the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by Act No. 9919, Jan. 1, 2010) on the premise of a bypass listing of stocks issued by Company A through a merger, and then donated the increased value of stocks through a bypass listing of stocks issued by Company A through the merger to his own children, and subsequently evaded the constructive gift tax, the case affirming the judgment below that the Defendant had a criminal intent to evade gift tax on the ground that it can be deemed that the Defendant had acquired the Company B, an Association-registered corporation, in mind of a bypass listing of the Company A, on the ground that it can be deemed that the Defendant had committed a crime of evading gift tax on the ground that the gift of stocks, which is the premise of imposing gift tax, or the acquisition of stocks donated within three years, was difficult.

[8] Article 41-5 of the former Inheritance Tax and Gift Tax Act (amended by Act No. 7010 of Dec. 30, 2003) provides that only when stocks are merged within a certain period from the date of donation or acquisition of stocks, etc., additional taxation shall be made only when the value of stocks, etc. increases, etc. can be made, and only when a person in a position of being able to use nonpublic information on corporate management, etc. and to have a significant influence on corporate management judgment donates or transfers stocks, etc. to a person in a special relationship with him/her as donated property, etc., the increased value of donated property shall be assessed and taxed as donated property; where it is confirmed that it is a profit due to substantial increase in corporate value by financial statements, etc. presented by the taxpayer, etc., the imposition of gift tax pursuant to the above Act is excluded from taxable object; and in certain cases, it is reasonable to correct the unfair burden of taxation and realize the equality of taxation by substantially assessing the value of property transferred at the time of donation or acquisition of stocks, etc.

[9] If the sum of the amount of tax evaded for one year regardless of the type of tax exceeds the amount stipulated in Article 8 (1) of the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by Act No. 9919 of Jan. 1, 2010; hereinafter the same shall apply), only one crime of violation shall be established, and the crime of violation of the same paragraph shall be constituted one year, and the crime of violation of the same paragraph shall be concurrent crimes among them. Meanwhile, "annual tax evasion, etc." referred to in Article 8 (1) of the former Act means one year from January 1 of the calendar year to December 31 of the previous Act, and "annual tax evasion, etc." referred to in the same paragraph means the aggregate of all the amount of tax evaded or illegally refunded for the purpose of tax evasion, etc. [10] Where the former Act on the Aggravated Punishment, etc. of Specific Crimes elapses from January 1 of each year to December 31 of each year, 2010 to the expiration of the reporting deadline and its respective tax base for tax evasion, etc.

[11] The case affirming the judgment below which held that in case where the prosecutor indicted all of the above acts as a comprehensive crime of violation of the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by Act No. 9919 of Jan. 1, 2010; hereinafter "former Act on the Aggravated Punishment, etc. of Specific Crimes") even though the year in which the period of each evasion of the constructive gift tax on profits such as listing following the merger and the gift tax on the gift tax on the donation of borrowed stocks differs, the crime of violation of Article 8 (1) of the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by Act No. 9919 of Jan. 1, 2010; hereinafter "former Act on the Aggravated Punishment, etc. of Specific Crimes"), since

[1] Article 3(1) and (6) of the former Punishment of Tax Evaders Act (amended by Act No. 919, Jan. 1, 2010; see Article 3(1) and (6) of the current Punishment of Tax Evaders Act) / [2] Article 9-3(1) and 9 of the former Punishment of Tax Evaders Act (amended by Act No. 9910, Jan. 1, 201; see Article 3(5) of the current Punishment of Tax Evaders Act (amended by Act No. 9910, Jan. 1, 2010); Article 10 of the former Punishment of Tax Evaders Act (amended by Act No. 910, Jan. 1, 2010; see Article 9-10 of the current Punishment of Tax Evaders Act) / [3] Article 10 of the former Punishment of Tax Evaders Act (amended by Act No. 9910, Jan. 1, 2019) / [19

[1] Supreme Court Decision 92Do299 delivered on August 14, 1992, 199Gong192, 2707 delivered on May 12, 2005, 2004Do7141Gong2005 delivered on May 12, 2005)/ [2] Supreme Court Decision 83Do2540 delivered on March 12, 1985, 87Do1059 delivered on November 8, 198, 1988, 198Do150 delivered on May 29, 2009; Supreme Court Decision 200Do2999 delivered on December 26, 2006; Supreme Court Decision 200Do4209 delivered on July 26, 2005/ [309Do2049 delivered on July 26, 2005]

person; and

Defendant and Prosecutor who are the senior Defendant and the Prosecutor

LLC et al. and one other

Seoul High Court Decision 2010No565 decided August 6, 2010

All appeals are dismissed.

The grounds of appeal are examined.

1. Judgment on the Defendant’s grounds of appeal

A. Violation of the former Act on the Aggravated Punishment, etc. of Specific Crimes

1) Whether it is illegal to permit changes in indictment

A prosecutor may add, delete, or change facts charged or applicable provisions of Acts stated in the indictment with permission of the court. In this case, the court must permit the identity of the facts charged to the extent not impairing the identity of the facts charged. Article 298(1) of the Criminal Procedure Act is maintained in the same way as the social facts that form the basis of the facts are fundamental in that the identity of the facts charged is maintained. In determining the identity of these basic facts, the defendant's act and social factual relations should be based in mind with the function of the identity of the facts, and normative elements should also be taken into account.

According to the records, the first public prosecutor calculated the gift tax imposed on the Defendant’s children on September 2003 by adding up the gift tax imposed on the acquisition of borrowed stocks and the gift tax on the increased value of the new stocks by the merger on or around July 26, 2003, on the premise that the Defendant’s children increased in the value of the stocks that the Defendant’s children donated or acquired through the bypassing listing on July 26, 2006, the first public prosecutor brought an indictment for the violation of the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by Act No. 7064, Dec. 26, 2003; the second public prosecutor brought an indictment for a violation of the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by the Act on the Aggravated Punishment, etc. of the Aggravated Punishment, etc. of the Aggravated Punishment, etc. of the Aggravated Punishment, etc. of the Aggravated Punishment, etc. of the Aggravated Punishment, etc. of the Aggravated Punishment, 200606).

In comparison with the facts charged prior to the amendment and the facts charged after the amendment, the facts charged subsequent to the amendment are different from the evaluation of the number of crimes regarding the crime of tax evasion, and the facts pertaining to the principal portion of the crime of tax evasion subject to prosecution do not change significantly to the facts charged prior to the amendment. As such, the identity of basic facts is recognized among the facts charged prior to the amendment

The decision of the court below that accepted the application for changes in the indictment by the prosecutor is just, and there is no error in the misapprehension of legal principles as otherwise alleged in the ground

(2) Whether the calculation of evaded tax amount is unlawful

The former Punishment of Tax Evaders Act (wholly amended by Act No. 9919, Jan. 1, 2010; hereinafter referred to as the "former Punishment of Tax Evaders Act") provides that "the representative of a corporation, or an agent, employee, or other employee of a corporation or individual" under Article 3 of the former Punishment of Tax Evaders Act may be an offender separate from a taxpayer under Article 9 (1) of the former Punishment of Tax Evaders Act (see, e.g., Supreme Court Decision 2004Do7141, May 12, 2005). The amount of tax evaded by the offender as the principal agent of the tax evasion shall be calculated on the basis of the offender, not the taxpayer. Meanwhile, in a tax imposed by the taxpayer's report, if the taxpayer fails to file a tax base report under the Act for the purpose of tax evasion, and the Government cannot determine or investigate the tax base of the relevant tax item after the deadline for filing the tax base for the relevant tax item expires (Article 9-3 subparagraph 1 of the former Punishment of Tax Evaders Act), and all or part of tax evasion decision within 198.

The lower court determined as to whether the Defendant violated Article 8(1) of the former Act on the Aggravated Punishment, etc. of Specific Crimes (amended by Act No. 9919, Jan. 1, 2010; hereinafter referred to as the “former Act on the Aggravated Punishment, etc.”) by calculating “the amount of evaded tax as an actor prescribed in Article 3 of the former Punishment of Tax Offenses Act” on the premise that the Defendant evaded gift tax imposed on the Defendant’s child as an agent of the Defendant, who is a donee, on the condition that he/she evaded gift tax imposed on him/her. Furthermore, the lower court determined that the Defendant could not deduct the Defendant from the amount of evaded gift tax even if the Defendant’s child paid part of gift tax evaded after the expiration of the filing deadline, on the grounds that the Defendant and his/her children did not report the tax base or tax amount of gift tax as if he/she actively made a sales contract between his

Examining the reasoning of the judgment below in light of the above legal principles, the above judgment of the court below is just, and there is no error in the misapprehension of legal principles as to the calculation of the amount of evaded tax, as

(3) Whether the subject of donation is a sale price of stone, and whether it is a stock

The lower court determined that the Defendant donated the instant borrowed stocks to his children on or around November 2002, instead of having the Defendant purchase the instant borrowed stocks with the price as a fund source, and that the Defendant donated the instant borrowed stocks to his children on or around September 2003.

This part of the ground of appeal is merely an error in the selection of evidence and fact-finding which belong to the full power of the fact-finding court, and it cannot be deemed a legitimate ground of appeal. In light of the reasoning of the judgment of the court below, considering the adopted evidence of the court of first instance cited by the court below, it is just to find the court below that the defendant donated the borrowed stocks of this case to his children on the grounds of various circumstances as stated in the judgment of the court below. There is no violation of the relevant legal principles or

(4) Whether the "Fraud or other unlawful act with respect to the evasion of constructive gift tax" is "Fraud or other unlawful act"

Article 41-5(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 7010, Dec. 30, 2003; hereinafter referred to as the "former Inheritance Tax and Gift Tax Act") means the case where a person having a special relationship with the largest shareholder, etc. receives stocks, etc. of the relevant corporation from the largest shareholder, etc. or acquires stocks, etc. of another corporation with compensation, or where the value of the relevant stocks, etc. of the relevant corporation is increased as a result of a merger with a stock-listed corporation or Association-registered corporation having a special relationship with the relevant corporation within 3 years from the donation date of the relevant stocks, etc., where a person who received stocks, etc. or acquired for compensation obtains profits above the standard prescribed by Presidential Decree in excess of the initial taxable amount or acquisition value of the relevant stocks, etc. (see, e.g., Articles 41-5(1) and (2), 41-3(1), 22-17 of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act, etc.).

The court below found that the defendant's act was impossible or considerably difficult to impose gift tax by means of concealing "the fact of donation of borrowed stocks between the children in a special relationship with the defendant and his children" under Article 41-5 (1) of the former Inheritance Tax and Gift Tax Act by voluntarily reporting and paying the transfer income tax on the gains from the transfer of stocks in the name of the next-name shareholder, a nominal seller's name, in order to make the appearance of the same as the actual payment of the purchase of stocks from the next-name shareholder in order to show that the children of the defendant made a false purchase of stocks as if they were directly purchased of stocks from the next-name shareholder in its holding, and transferring the money to the deposit account in the name of the next-name shareholder directly who is the seller in the name of the defendant's children, or depositing the money from the deposit account in the name of the second-name shareholder in the name of the defendant's children in the name of the second-name shareholder.

In light of the reasoning of the lower judgment and the content of relevant statutes, the lower court’s aforementioned determination is justifiable.

This part of the ground of appeal is based on the premise that the next-name shareholders in the judgment of the court below fall under the "large shareholder, etc. of the relevant corporation" and the defendant's children fall under the "person having a special relationship with relatives, employees, etc." under Article 41-5 (1) of the former Inheritance Tax and Gift Tax Act in relation to the next-name shareholders, which is not consistent with the objective meaning of the law, or that it is based on facts that are contrary to the legitimate recognition by the

(5) Whether there is a criminal intent to evade the constructive gift tax

In relation to the crime of tax evasion, which is an intentional crime, where a taxpayer or an actor under Article 3 of the former Punishment of Tax Evaders Act commits or attempts to commit an unlawful act while recognizing the fact that the occurrence of the result of tax evasion would occur, the criminal intent of tax evasion is recognized (see, e.g., Supreme Court Decision 2004Do817, Jun. 29, 2006). This legal doctrine applies to the case of a crime of evading constructive gift tax under Article 41-5 of the former Inheritance Tax and Gift Tax Act. Therefore, in order to establish the crime of tax evasion, it is necessary to recognize the fact that the tax evasion subject under the former Punishment of Tax Evaders Act committed a "Fraud or other unlawful act that makes it impossible or considerably difficult for him to impose and collect taxes," with the mind that the obligation to pay the gift tax on the "profit such as listing upon the merger" takes into account.

The court below determined that, in light of the circumstances stated in its reasoning, when the defendant actively concealed the transfer of borrowed stocks to his children around September 2003, thereby making it difficult to find the fact of the donation of stocks, which is the premise of imposing the constructive gift tax, or the fact of acquiring the stocks donated within three years, with the property donated within three years, the Defendant’s acquisition of the registered-registered corporation as indicated in its holding in order to take over the stocks of his children in consideration of the bypass listing of the company’s holding that the company issuing the borrowed stocks is the company, and thus, it can be deemed that the Defendant had a criminal intent to increase the value of the stocks transferred through the merger and to donate the increased value of the stocks to his children and to evade the constructive gift tax accordingly.

Examining the evidence adopted by the court of first instance as cited by the court below in light of the reasoning of the judgment below and the aforementioned legal principles, the court below’s fact-finding and judgment are just and acceptable. Contrary to the allegations in the grounds of appeal, there were no errors in violation of the principle of court-oriented or direct principle, or free evaluation of evidence

(6) Whether the constructive gift tax system is unconstitutional or not

Article 41-5 of the former Inheritance Tax and Gift Tax Act generally imposes additional taxes only when stocks, etc. are merged within a certain period from the date of donation or acquisition of stocks, etc., taking into account the period required for listing or registration through the merger, by taking into account the fact that the value of the stocks, etc. is increased by the merger within a certain period from the date of donation or acquisition thereof; the use of undisclosed information on corporate management, etc. which may cause a change in the value of the stocks, etc.; and only when a person in a position of having a special relationship, such as his/her relatives, etc., donates or transfers stocks, etc. property to a person in a relationship with him/her, and imposes taxes on the increased value of the property as donated property; where it is confirmed that the profit is due to the substantial increase in corporate value after the donation or acquisition of stocks, etc. property through the financial statements, etc. presented by the taxpayer, the imposition of gift tax under the above Act is excluded from taxable objects; where the difference is less than the amount of gift tax originally imposed on the basis of the settlement date based on the merger registration date, and it is justified.

B. Violation of the former Securities and Exchange Act

Article 18-4 (2) of the former Securities and Exchange Act (repealed by Article 2 of the Addenda to the Financial Investment Services and Capital Markets Act, Act No. 8635, Aug. 3, 2007; hereinafter referred to as the "former Securities and Exchange Act") provides that "the purpose of inducing a trade" is to artificially manipulate the market price and to make a change in the market price on the securities market, it is not an issue as to whether the market price is publically formed by the principle of natural demand and supply in the securities market or to raise the purchase and sale of securities, but the degree of awareness of the purpose is insufficient. Furthermore, even if the sale and purchase of securities constitutes a crime under subparagraph 1 of the above provision, it is not necessary to determine whether there is a possibility of a change in the market price and trading volume to be formed in the free competition market as a whole before and after the lapse of 0 years from the fact that there is no possibility of a change in the market price to the extent that it can be seen that there is a change in the market price before and after the sale.

In full view of the circumstances as indicated in its holding, such as the circumstances at the time of purchasing the instant shares, the type of transaction, and the motive for the transaction, the lower court determined that the Defendant had an intention to attract a transaction by artificially changing the market price at the time of purchasing the shares from July 2008 to November 2008, and that the Defendant had actively directed his employees of the company to purchase the shares with the funds of the company or its children, thereby leading the Defendant to commit the manipulation of market price by exercising functional control by actively ordering them to purchase the shares with its own employees.

Examining the evidence adopted in the judgment of the court of first instance as cited by the court below in light of the reasoning of the judgment below and the above legal principles, the above judgment of the court below is just and acceptable. Contrary to the allegations in the grounds of appeal, there were no errors in the misapprehension of the legal principles as to manipulation of market price and requirements for establishment of a joint principal

2. Judgment on the grounds of appeal by the prosecutor

A. Violation of the former Aggravated Punishment Act (Tax)

(1) The part of the facts charged as to the evasion of gift tax and constructive gift tax

(1) Where the total amount of tax evaded for one year or more exceeds the amount stipulated in Article 8(1) of the former Act on the Aggravated Punishment, etc. of Specific Crimes, regardless of the type of tax, only one crime shall be established, and the crime of violating the same paragraph shall be composed of one year. Meanwhile, “annual tax evasion” referred to in Article 8(1) of the former Act means one year from January 1 to December 31, 200; “annual tax evasion, etc.” means the total amount of tax evaded or otherwise refunded for each year (from January 1 to December 31) regardless of the taxable period of each tax item, regardless of the previous tax item, for the purpose of evading gift tax evasion by 20 years (see, e.g., Supreme Court en banc Decision 9Do3822, Apr. 20, 200). Furthermore, the former Act on the Aggravated Punishment, etc. of Specific Crimes and the Act on the Aggravated Punishment, etc. of Specific Crimes provides for the tax base of tax evasion by the time limit for filing and reporting of general gift tax evasion.

(2) The evasion of the gift tax resulting from capital increase by issuing new shares as of December 26, 2003 and the evasion of the part relating to new shares by offering new shares from among the constructive gift tax resulting from a circumvention listing through a merger around July 2006

The court below rejected the prosecution pursuant to Article 327 subparagraph 2 of the Criminal Procedure Act on the ground that the prosecution procedure is invalid in violation of the provisions of the Act on the Punishment of Tax Evaders, since the tax evasion tax amount is less than 500 million won, it can not be punished pursuant to Article 8 (1) 3 of the former Act on the Aggravated Punishment, etc. of Specific Crimes, and since there is no accusation by a tax official pursuant to Article 9 (1) 3 of the former Punishment of Tax Evaders Act on this part, there is no accusation by the tax official pursuant to Article 6 of the former Punishment of Tax Evaders Act on the ground that the prosecution procedure is invalid in violation of the provisions of the Act on the Aggravated Punishment, etc. of Tax Evaders.

As seen above 2. A. (1), since the part prosecuted for the violation of the former Act on the A.I.D. of Specific Crimes (tax) due to the evasion of gift tax due to capital increase with consideration on December 26, 2003 is in a concurrent relationship with the crime of evasion of gift tax such as other gift tax, the court below's decision is just in deciding whether the punishment law should be determined only on the basis of the amount of evaded tax related to the gift tax due to capital increase with consideration for the above consideration for the capital increase and the requirements for indictment such as filing a complaint are

On the other hand, the court below held that the defendant's act of evading gift tax cannot be recognized on the ground that in calculating the amount of deemed gift tax evaded, the defendant's act of calculating the amount of deemed gift tax evaded, on the ground that the circumstance of the new shares issued on December 26, 2003 cannot be considered in calculating the amount of gift tax evaded by the defendant, on the ground that the amount of deemed gift tax evaded by the defendant cannot be considered in calculating the amount of gift tax evaded, on the ground that the amount of deemed gift tax evaded by the defendant's act of calculating the amount of deemed gift tax evaded, the portion calculated on the basis of only the value of the value of the borrowed stocks donated to his children on or around September 2003, including the value of the donated stocks through the merger, is not proven if the amount exceeding the legal fiction amount of gift tax calculated on the basis of only the value of the borrowed stocks calculated on the basis of only the value of the transferred stocks to his children on or around September 2003.

Examining the relevant evidence in light of the records, the above judgment of the court below is justified in accordance with the rational free evaluation of evidence by the judge of the fact-finding court, and there is no violation of law of free evaluation of evidence in violation of logical and empirical rules as otherwise alleged in the ground of

3) The point of evading capital gains tax due to the transfer of borrowed stocks in 2006

The court below held that the defendant did not report and pay the tax base and transfer income tax on the transfer margin acquired by selling the borrowed stocks owned by the defendant as a major shareholder of the company in its holding, which is a KOSDAQ-listed corporation, but since the following stocks were owned by the defendant under the name of officers and employees since it was established and operated by the company in its holding, since the defendant was a non-listed corporation, the merger new stocks allocated to the borrowed stocks of the company in its holding as a result of merger with the KOSDAQ-listed corporation. Thus, there is no evidence to prove that the defendant began to hold the borrowed stocks for the purpose of evading transfer income tax only after January 1, 1999 when the law that imposed discriminatory taxation on the transfer margin of stocks owned by the major shareholder and other shareholders was enforced, it is difficult to view that the defendant sold the borrowed stocks of the company in its holding as the name of the borrowed stockholder without converting the stocks of the former listed corporation into the real name after the enforcement of the above taxation laws and regulations.

Examining the relevant evidence in light of the legal principles regarding "Fraud and other unlawful acts" as seen in the above 1-A-4, the court below’s above determination is just and acceptable. In so doing, contrary to what is alleged in the ground of appeal, there were no errors of misapprehending the relevant legal principles or exceeding the bounds of the principle of free evaluation of evidence by violating logical and empirical

B. Violation of the Act on the Aggravated Punishment, etc. of Specific Crimes

The criminal intent of receiving, demanding, or promising money, valuables, or benefits in connection with the intermediation of matters pertaining to the duties of public officials is a crime constituting the crime, and it is required to prove the criminal intent. In a case where the defendant denies the criminal intent despite recognizing the fact that money, valuables, etc. are received, in view of the nature of the object, it is inevitable to prove the criminal intent by means of proving indirect facts that have a substantial relation with the criminal intent, and what constitutes considerable relation indirect facts should be determined by means of a reasonable method of determining the link of facts based on the close observation or analysis power based on normal empirical rule (see, e.g., Supreme Court Decision 2004Do8780, Jun 24, 2005).

The court below maintained the judgment of the court of first instance that acquitted the Defendant of this part of the facts charged on the ground that the evidence submitted by the prosecutor alone was insufficient to acknowledge that the above 150,000 won was received from the public officials of the National Tax Service under the pretext of soliciting a tax investigation against Nonindicted Co. 2, etc., or that the money was received from the public officials of the National Tax Service under the pretext of soliciting a tax investigation against Nonindicted Co. 2, etc., or that there was no other evidence to prove otherwise.

In addition, the court below maintained the judgment of the court of first instance that acquitted the defendant of this part of the facts charged on the ground that it cannot be deemed that the defendant demanded the non-indicted 1 to make a loss disposal of the amount of investment settlement in its holding, in light of the time and circumstance when the defendant started to request the loss disposal of the amount of investment settlement, the behavior of the defendant before and after the tax investigation of this case and the detention of the non-indicted 1, and the defendant's role or position at the time when the defendant demanded the loss disposal of this case around January 2009, it cannot be ruled out that the defendant repeated the loss disposal request in the sense of requesting the transfer of non-indicted 1's shares without compensation in accordance with the investment relationship settlement plan with the existing non-indicted 1.

Examining the relevant evidence in light of the record and the legal principles as seen earlier, the above judgment of the court below is just and acceptable, and there is no violation of the principle of free evaluation of evidence against logical and empirical rules as otherwise alleged in the ground of appeal.

C. Violation of the former Securities and Exchange Act

1) The point of fraudulent fraudulent transactions

Article 18-4 (4) 2 of the former Securities and Exchange Act provides that "an act of seeking money or other economic benefits by causing misunderstanding to other persons by making a false representation of important matters concerning the sale and purchase or other trading of securities or by using a document with no necessary fact omitted." The term "material fact" refers to an act of having the same purport as "material information not disclosed to the general public" under Article 188-2 (2) of the same Act, which is prohibited from using undisclosed information, which may have a significant impact on the property and management of the relevant corporation, or affect investors' judgment of investment. In addition, it does not merely mean an act of not simply neglecting it without correcting any material fact described above through related agencies, but also an act of actively utilizing such information with the same intent as "an act of making use of money or other economic benefits" under Article 188-2 (2) of the former Securities and Exchange Act, such as an act of making a false representation or misunderstanding to the extent that it can affect investors' judgment of investment." Furthermore, it should also be determined that the aforementioned act of acquisition or 200.

The court below upheld the judgment of the court of first instance that acquitted the defendant of this part of the facts charged on the ground that the evidence submitted by the prosecutor alone is insufficient to acknowledge that the defendant had an intention to obtain pecuniary profits by making false representation in the documents, such as a merger report, a report on the change of the largest shareholder, and a report on the stocks held by executives and major shareholders, etc., submitted by the relevant agencies, such as the Financial Supervisory Commission, which are submitted by the prosecutor, to the relevant agencies, such as the case of a merger report, a report on the change of the largest shareholder, and a report on the stocks held by executives and major shareholders, and there is no other evidence to prove otherwise.

Examining the relevant evidence in light of the record and the aforementioned legal principles, the above judgment of the court below is just and acceptable. Contrary to the allegations in the grounds of appeal, there were no errors in the misapprehension of the legal principle as to fraudulent transactions, or in violation of the principle of free evaluation of evidence.

2) The point of September 7, 2006 market price manipulation

In light of various circumstances as indicated in its reasoning, such as the contents of the Defendant’s request related to the purchase of shares, ownership relationship of funds used for the purchase of the instant shares, degree of involvement in the Defendant’s process of the purchase of shares, etc., the lower court maintained the first instance judgment that acquitted the Defendant of this part of the facts charged on the ground that it is difficult to recognize that the Defendant actively participated in the Defendant’s act of price manipulation crime on the part of Nonindicted Party 1 and moved functional control over the Defendant’s own intent to move his own intent to practice, on the ground that it is difficult to recognize that the Defendant was not guilty of this part of the facts charged on the ground that it was in fact determined that Nonindicted Party 1 purchased a large number of shares of the Defendant and delivered them to Nonindicted Party 1 in the mind that the share price would naturally rise.

Examining the relevant evidence in light of the legal principles as to the requirements for establishing a co-principal as seen in the above 1-B and the above 1-B, the above judgment of the court below is just and acceptable. In so doing, contrary to what is alleged in the ground of appeal, the court below did not err by misapprehending the relevant legal principles or by exceeding

3. Conclusion

Therefore, all appeals by the Defendant and the prosecutor are dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.