Seoul High Court 2012Nu852 ( December 14, 2012)

early 2010 Before 1590 ( November 09, 2010)

If a tax invoice is received from a person other than the actual supplier, the additional tax on non-receiving evidence shall be levied.

The Plaintiff Company can be deemed to have been aware of the fact that the key purchase price of the instant oil was merely the data and was not the actual supplier of the instant oil, and therefore, the Plaintiff Company’s receipt of the tax invoice under the name of the main purchase price in the instant case, which is not the actual supplier, constitutes “the case where the Plaintiff Company intentionally violated its duty” and thus, did not limit additional tax

Article 17 of the Value-Added Tax Act, Article 76 of the Corporate Tax Act, and Article 49 of the Framework Act

2013Du2082 Revocation of Disposition of Imposing Corporate Tax and Value-Added Tax

AAAA et al.

Head of Sejong District Tax Office et al.

Seoul High Court Decision 2012Nu852 Decided December 14, 2012

June 14, 2013

All appeals are dismissed.

The costs of appeal are assessed against each appellant.

The grounds of appeal are examined.

1. As to the ground of appeal by Plaintiff AAA

A. Regarding ground of appeal No. 1

In light of the circumstances indicated in its holding, the lower court determined that the instant tax invoice, which the Plaintiff Company AAA (hereinafter referred to as the “Plaintiff Company”) received from the Plaintiff Co., Ltd. Co., Ltd. Co., Ltd. 2 in 2007, No. 1 in 2008 and No. 2 in 2008 (hereinafter referred to as the “the instant tax invoice”) constituted a “tax invoice different from the fact that the oil supplier and the actual supplier entered differently” in the said tax invoice. Unless the recognition of fact and the adoption and evaluation of evidence conducted on such premise do not exceed the bounds of the principle of free evaluation of evidence, the lower court’s judgment did not seem to have exceeded the bounds of the principle of free evaluation of evidence. Accordingly, the allegation that the lower court erred in its determination is merely a criticism of matters falling under the entire authority of the lower court, and thus, does not constitute a legitimate ground of appeal.

B. Regarding ground of appeal No. 2

Unless there is any special circumstance that the supplier and the actual supplier under the tax invoice are not aware of the fact that the supplier did not know the fact that the supplier was the nominal owner of the tax invoice, the input tax amount under the tax invoice cannot be deducted or refundable (see, e.g., Supreme Court Decision 2011Du2228, Dec. 27, 201). The lower court determined that the Plaintiff Company knew or could have known the fact that the oil supplier was not the main purchaser of the instant case in light of all the circumstances, including the Plaintiff Company’s experience in purchasing oil, the process of purchasing oil, the entire transaction process of purchasing oil, the price and the transaction amount of the purchased oil, etc.

C. Regarding ground of appeal No. 3

Article 49(1) main text and 2 of the former Framework Act on National Taxes (amended by Act No. 911, Jan. 1, 2010; hereinafter the same) provides that the limit of the additional tax on the receipt of evidence under Article 76(5) of the Corporate Tax Act shall be KRW 000,000, and the proviso of Article 76(1) of the former Framework Act provides that "the same shall not apply where the obligation is intentionally violated." In light of the circumstances stated in its reasoning, etc., the lower court determined that the Plaintiff Company was aware of the fact that the issue purchaser of the instant case was merely merely on the so-called data and that it was not an actual supplier of the instant oil, and therefore, the Plaintiff Company’s receipt of the tax invoice under the name of the main purchaser of the instant case, which is not an actual supplier, constitutes “the intentional violation of the corresponding obligation” under the above proviso. In light of the above provisions and records, the lower court’s determination is justifiable, and it did not err by misapprehending the legal doctrine on requirements for additional tax under the proviso

2. As to the grounds of appeal by the director of the Chungcheong District Tax Office

Although the assertion by the chief of the Cheongju Tax Office can be recognized that the actual owner of the shares held by the MaO is the plaintiff MaOO, the judgment of the court below is erroneous. However, this is merely an error in the selection of evidence or fact-finding which belongs to the exclusive jurisdiction of the court below and thus cannot be a legitimate ground for appeal. Furthermore, even if the court below's fact-finding and judgment are examined in light of the records, it did not err by exceeding the bounds of the principle of free evaluation

3. Conclusion

Therefore, all appeals are dismissed, and the costs of appeal are assessed against each appellant. It is so decided as per Disposition by the assent of all participating Justices on the bench.