Suwon District Court 2016Guhap1797 ( October 13, 2016)

Seoul High-2012-0175 ( October 12, 2012)

Whether it is a false tax invoice or not

The HongB stated that the transaction with the above company was conducted in accordance with the direction of JD and that the full payment was deposited into the Plaintiff’s account. However, there is no evidence to acknowledge the above statement, and it is reasonable to deem that the HongB acquired the profits of theCC. Therefore, it cannot be said that the CC is not an independent business entity from the Plaintiff.

Article 2 of the Value-Added Tax Act

Seoul High Court 2016Nu59173 ( October 14, 2017)

AAari Corporation

○○ Head of Tax Office et al.

Suwon District Court Decision 2014Guhap1797 Decided March 13, 2016

201.01.24

oly, 2017.02

1. All appeals filed by the Defendants are dismissed. 2. Costs of appeal are assessed against the Defendants.

1. Purport of claim

The director of the tax office of Si, the director of the tax office had the Plaintiff on September 4, 2012, 767,026,750 of value-added tax for 1st 2007.

Won, value-added tax of 270,515,480 won, value-added tax of 1 year 2008 41,329,900 won,

Value-added tax for 2 years 2008 44,210,080 won, corporate tax for 2007 97,325,580 won, and for 2008

The imposition of corporate tax of KRW 53,163,070 and the imposition of corporate tax of KRW 2008 by the head of the Chungcheong District Tax Office on September 3, 2012 to the Plaintiff

The imposition of value-added tax of KRW 44,902,120 per year shall be revoked in all.

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. Quotation of judgment of the first instance;

The reasoning for the court’s explanation on this case is as stated in the reasoning of the judgment of the court of first instance, except for the dismissal of the judgment of the court of first instance as follows. Thus, this Court shall accept it in accordance with Article 8(2) of the Administrative Litigation Act and Article 420 of the Civil Procedure

○ The Prosecutor appealed from the fourth to fifth of the judgment of the first instance court as follows, but the appeal was dismissed, and the above judgment of not guilty became final and conclusive (see Supreme Court Decision 2016Do9443, hereinafter referred to as “related criminal cases”).

○ From 5 to 7 pages 9 to 7 of the first instance judgment are as follows.

2) Comprehensively taking account of the overall purport of the arguments in this case as indicated in No. 20, No. 5, 8, 11, and 12, J. 2, the representative director of the Plaintiff, J. 2, 200, supplied the Plaintiff with Information. E.E. 2, E.E., was unable to conduct normal business due to the purchase of non-data, etc., and the Plaintiff had HongB established and operated the Information Co., Ltd. around 2004. The HongB made a report on the entry and withdrawal of the Information Co., Ltd., Ltd. to J. 2, 200, RedB, Co., Ltd., Ltd., Ltd., 200, 200, 200, 200, 200, 200, 200, 20, 20, 20, 20, 20, 20, 20, 20, 20, 20.

However, in light of the following circumstances in which evidence Nos. 5, 7, 8, 4, 10, 13, 15, and 16 were revealed by comprehensively considering the purport of the entire pleadings, it is difficult for HongB to believe the above statement of HongB, and the remaining facts of recognition alone do not constitute a false tax invoice prepared differently from the facts, and there is no evidence to acknowledge otherwise.

① The lessor entered into a lease agreement with the Plaintiff’s office directly prepared separately from the Plaintiff’s office. From February 1, 2005 to June 13, 2008, HongB paid the Plaintiff rent to HaB. There is no evidence to acknowledge that the Plaintiff paid the amount equivalent to the rent of the CCB office to HongB. Rather, HongB stated that the Plaintiff did not have paid the rent of the CC office in the relevant criminal case. In addition, HongB did not have paid the fees for tax accountants, but, on July 24, 2008, sent 660,000 won to the LLB office located in Seoul, HongB stated that the Plaintiff was a tax processing fee for business affairs. The RedB purchased the CC and supplied the CC’s account books and provided it directly to the CC during the pertinent criminal case. On the other hand, HongB made a statement that the CC had been established and supplied the CC’s account books and provided it directly during the pertinent year.

② In the relevant criminal case, the professional examiners stated that “CC supplied to the Plaintiff for two years from 2007 to 2008 is KRW 8,498,358,445, which is the amount of KRW 8,468,548,649. Of these, it is difficult to confirm the settlement by means of a bill or set-off. However, it is difficult to confirm the settlement by means of a bill or set-off, but the settlement in cash is consistent with the date and amount of the transaction as indicated in the ledger of the transaction.” Accordingly, the Plaintiff appears to have made a settlement to redB as indicated in the ledger of the transaction partners. Accordingly, it is difficult to find that the Plaintiff did not receive any value-added tax from HongB,725,780,420, which is the amount calculated by adding 10% to 7,725,780,420,420, which was conducted by the Defendant issuing a tax invoice different from the fact, and thus, it is difficult to find that the Plaintiff was paid to HongB separately from the Plaintiff’s.

③ RedB stated that it was not paid value-added tax by the Plaintiff, but did not have any statement that re-transfered the transferred value-added tax to the Plaintiff. On the amount reported by HongB to re-transfer to RedF, JD and RedF stated to the effect that it would have been transferred the purchase price of the EEEEEEdrCC in the relevant criminal case. The RedB also stated that HongB would have remitted the said re-transfer to theCC supplied by the EEEdrrr for the said re-transfer in the relevant criminal case. In addition, RedB decided that the amount calculated by adding the above 2% amount to the purchase price of theCC was determined as the purchase price of the Plaintiff, and used the amount paid by the Plaintiff to the Plaintiff for personal purposes, such as living expenses or repayment of borrowed money. In light of each of the above circumstances, it is reasonable to deem that the Plaintiff paid to RedB to the RedB was finally reverted to the RedB.

④ The RedB also providedCC to the Plaintiff and received the payment. The RedB stated in the relevant criminal case that the transaction with the said company was conducted in accordance with JD’s instruction, and that the full payment was deposited into the Plaintiff’s account. However, there is no evidence to acknowledge the above statement, and rather, the third NbC’s representative Park Jong-K deposited theCC price into the bank account of RedB, and that it was not aware of the fact that the Plaintiff or JD participated in the transaction with the said company.

⑤ Although HongB is an employee of the Plaintiff engaged in the Plaintiff’s product sales business (which is the representative of the Plaintiff, recognized that HongB was an employee engaged in the Plaintiff’s business), there is no evidence that the economic entity, a natural person, is unable to engage in two economic activities, and that the purchase ofCC did not constitute a false statement by JD that the statement made by HongB remains more than twice a week. As seen earlier, HongB independently operated theCC and received from the Plaintiff or its subsidiary (which is equivalent to KRW 1.1 million per month), it is reasonable to deem that HongB acquired the Plaintiff’s income even because it is difficult to cover the cost of living, automobile, housing purchase, etc., solely on the basis that HongB was an employee of the Plaintiff. Therefore, the mere fact that HongB was an employee of the Plaintiff, it cannot be said that the Plaintiff and the Plaintiff is not an independent business entity.

6) The RedB’s net level and weight ofCC that is supplied to the Plaintiff in the course of operatingCC was cut down with JD and transaction with the Plaintiff. In relation to the supply ofCC, HongB failed to pay taxes, such as value-added tax, and Article 2(1)1 of the former Value-Added Tax Act provides that “any person who supplies goods or services independently on a business basis regardless of the existence or absence of profit-making profit, shall be liable to pay value-added tax.” Thus, redB is not liable to pay value-added tax if it is deemed that the goods are not independently supplied, and there is motive to make a false statement in order to avoid his/her responsibility.

2. Conclusion

Therefore, the judgment of the court of first instance is justified, and the appeal by the defendants is dismissed in its entirety as it is without merit.