National Tax Service Review Division 2011-0138 ( December 16, 2011)

It seems that the Plaintiff was paid the instant contract in return for the services provided during the period as the executor by waiver of authority as an executor related to the construction project.

In light of the fact that the Plaintiff’s contribution to the instant construction is not enough to finance the Plaintiff’s contribution to the Corporation as a non-profit incorporated association established in March 2002, it is reasonable to deem that the contribution that the Plaintiff invested to the instant construction is the contribution received from the H General Construction, a contractor, unlike the Plaintiff’s assertion that he/she borrowed from a member company, and evidence to support the Plaintiff’s assertion is insufficient.

2012 disposition of revocation of imposition of value-added tax, etc.

KoreanAAA Association, an incorporated association

The head of Yangcheon Tax Office

May 21, 2013

July 5, 2013

1. All of the plaintiff's claims are dismissed.

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

The first period portion of February 7, 2010 that the Defendant had against the Plaintiff on February 7, 2011 (which appears to be a clerical error in December 1, 2010)

The imposition of value-added tax of KRW 000, corporate tax of KRW 000 for the business year 2008, and corporate tax of KRW 000 for the business year 2009 shall be revoked.

1. Details of the disposition;

A. The Plaintiff is a non-profit incorporated association aimed at coordinating opinions with relevant organizations with respect to the AA project, and promoting joint activities for the sound fostering and development of the AA industry.

B. From July 12, 2010 to August 20, 2010, the Defendant conducted a tax investigation with respect to the Plaintiff, and discovered the fact that the Plaintiff performed a new establishment of a charnel house of the OOO that is an incorporated foundation, and received 000 won in total, including the agreed amount of KRW 000 and interest interest interest of KRW 000 (hereinafter “instant agreed amount”).

C. On December 1, 2010, the Defendant decided and notified the Plaintiff on December 1, 2010 of the value-added tax 132,071,271 won in relation to the instant agreed amount (hereinafter “instant disposition imposing value-added tax”).

D. In addition, the defendant confirmed that the part of the contract amount of this case received by the plaintiff in 2008 and 2009 as above was paid to Lee Do and director Lee E who is the representative of the plaintiff, and calculated the amount as provisional payment unrelated to the work, and treated the amount as a bonus for the same amount as the plaintiff's income when calculating the income amount for the business year 2008 and 2009. Accordingly, on December 1, 2010, the defendant decided and notified the plaintiff on December 1, 2008 that the amount was included in the calculation of the income amount for the business year 2008 and the corporate tax amount of 000 won for the business year 2009 (hereinafter "the disposition of imposition of corporate tax of this case", and the "value-added tax of this case and the corporate tax imposition disposition of this case" were "the disposition of imposition of corporate tax of this case" on March 18, 2014.

[Grounds for Recognition] The facts without dispute, Gap evidence 13, and Eul evidence 1 through 3 (each number is included in natural disaster) and the whole purport of the pleading

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The contract amount of this case is unlawful since the plaintiff provided services in connection with the establishment of CCC and collected funds invested by the plaintiff in the new establishment of a CCC during this period when the plaintiff renounced the agreement that the plaintiff would have participated in the establishment of a CCC, and even though this does not fall under the object of value added tax, the disposition of value-added tax of this case is unlawful. In addition, the disposition of the corporate tax of this case on the premise that the plaintiff made sales equivalent to the contract amount of this case in return for the supply of services is also unlawful.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

(1) Facts of recognition

(A) The Plaintiff is a non-profit incorporated association established on March 27, 2002 for the purpose of coordinating opinions with relevant organizations of AA business and promoting and developing the AA industry in a sound manner.

(B) OOOO(hereinafter referred to as a “OOOO”) as an incorporated foundation is to promote a charnel and temple building project on the land (hereinafter referred to as “the land in this case”) other than 50,380 square meters and 18 lots (hereinafter referred to as “the land in this case”). Around February 10, 2003, the incorporated foundation appointed BB as the chief inspector of the CCC, who is the inspector to be established in the said charnel, appointed BB, and delegated BB with all the powers concerning the use of the land in this case, the building of sculptures and sculptures, and the profit-making business ofCC.

(C) Since then, on November 24, 2003, JungB made an agreement between the Plaintiff on November 24, 2003, and between the Plaintiff and the Plaintiff on the land in which the construction of a new house (hereinafter referred to as “the instant construction”) was implemented, and the Plaintiff agreed to entrust the Plaintiff with all rights (execution, the subject of construction, and the legal rights) concerning the said construction, and the Plaintiff made an investment in order to complete the construction within the construction period without any limit (including the entire costs related to the said construction (964 square meters in the construction of a house, the entry roads, the charnel houses, and the parking lots).

(D) In accordance with the above agreement, the Plaintiff led the instant construction to H Comprehensive Development (hereinafter referred to as “H Comprehensive Development”), and the H Comprehensive Development was to perform the building and civil engineering works in a charnel, and the Plaintiff was to be in charge of the interior facilities and stone installation works in a charnel house (excluding the interior facilities and stone installation works in a charnel house). Accordingly, the Plaintiff and JungB entered into a construction standard agreement with the H Comprehensive Development on April 22, 2004, between the Plaintiff and JungBB, between the owner and the guarantor, and between the Plaintiff and the guarantor, from May 15, 2004 to December 31, 2004, and from May 15, 2004 to December 31, 2004, with the contract amount of KRW 3.92,700,000,000,000 for the construction works in a charnel building (excluding the inside facilities and stone installation works in a charnel house).

(E) On the other hand, the LB invested money for the establishment of a charnel in the instant land before the establishment of a charnel, and the LB made a provisional disposition against the disposal of real estate on the instant land, while ED, the representative of the Plaintiff, and EB made a recognition of the amount invested by the LB on April 27, 2004 as KRW 00, and ED paid the said amount to the largest F, and the F shall pay KRW 000 on April 27, 2004, and KRW 000 on December 30, 2004, and KRW 000 on December 30, 2004, while the F shall receive KRW 00 on April 27, 2004, and at the same time receive KRW 00 on December 30, 200, the LB made a cancellation of the registration against the disposal of real estate on the instant land.

(f) In addition, upon the request of dueBB, the Plaintiff deposited KRW 000,00, from the head of the E EE-E, who was in office as the Plaintiff’s director, to the head of KimG, and the PartyBB agreed to pay the Plaintiff responsible for it.

(g) However, under the agreement that the Plaintiff would waive all the rights related to the instant construction between the Plaintiff, GovernmentB, and H Comprehensive Development, and the Plaintiff would, on August 27, 2004, mutually determine the amount of the Plaintiff’s own funds to be paid to HaBB to the Plaintiff. 2. Pursuant to the agreement between HaB and HaB, HaB, the Plaintiff would pay to the Plaintiff the amount of 1,000 out of HaB’s total funds to be paid 50% of HaB’s construction cost, and the amount should be guaranteed at least one billion won. 3. 4. Certification on April 2004-1354, and the agreement between HaBB and HaB should be paid to HaB, HaB, the Plaintiff should not pay to HaB, HaB, HaB, the total installation cost of the instant construction and HaB house to be paid to HaB. 30% of the total installation cost of the HaB.

(h) On November 24, 2003, the Plaintiff, who was delegated all all the powers on the instant construction by JungB, paid KRW 000 won in total, including the enforcement of the instant construction, until August 27, 2004, and KRW 000 in total, among November 28, 2003, and December 4, 2003, and KRW 00 in total, from May 3, 2004, and from May 14, 2004, to the maximum of KRW 00 in April 27, 2004.

(i) On the other hand, the Plaintiff received 00 won in total, including H Comprehensive Development, 00 won in April 23, 2004, 000 won in April 29, 2004, and 000 won in April 30, 2004, and 00 won in May 18, 2004.

(j) The Plaintiff filed a claim against HaB under the Seoul Central District Court Decision 200671-hap 6828, while HaB, from June 1, 2006 to January 24, 2008, HaB ordered the Plaintiff to pay 5% interest per annum from the next day to the day of full payment, and 20% interest per annum from the next day to the day of full payment. HaB appealed appealed from Seoul High Court Decision 2008Na26395, and HaB decided 2000, 1000 to 200.5% interest per annum from the first instance court Decision 200,000 to 206.5% interest per annum from 200,000 to the date of full payment.

(k) Meanwhile, after the judgment of the court of first instance was rendered, Party BB deposited the agreed amount and interest to be paid to the Plaintiff, and the Plaintiff recovered the total of KRW 000 on February 4, 2008, and KRW 000 on February 13, 2008, and KRW 000 on October 13, 2009.

(l) Of the above 000 won recovered by the Plaintiff, KRW 000 was paid to EE, a director of the Plaintiff, and among them, KRW 259,390,000 was paid to E, a director who is the representative of the Plaintiff.

[Ground of recognition] The non-contentious facts Gap's statements in Gap evidence 1 to 13 (if there are each number, the number number shall be stated) and the whole purport of the pleading

(2) Determination on the lawfulness of the disposition imposing the value-added tax of this case

(A) According to the above facts, the plaintiff was entrusted with all the authority concerning the construction in the process of executing and executing the construction in this case with HaB, was selected as the contractor, the civil petition occurred in relation to the construction in this case, and paid HaBB and HaB to HaB and HaB (the plaintiff seems to have paid the above money to HaBB and HaF with the money received from HaH comprehensive development, as seen earlier). The plaintiff was provided with services to HaB and HaB in relation to the construction in this case. On August 27, 2004, it is reasonable to view that HaB provided the plaintiff with the authority to pay 1,000 won out of the HaB's 208 and 2009 as the price for the construction in this case and agreed to receive 1,000 won (at least one billion won guarantee amount) for the construction in this case, and the plaintiff was provided with the authority to pay 1,390,000 won for the construction in this case.

(B) As to this, the Plaintiff’s assertion that the instant agreement that the Plaintiff received from EBB was recovered from EBB by lending funds from EBB from EB, Inc., one of its member companies, EB, ED, etc.

According to the above facts, the plaintiff paid 00 won and 000 won to HaBB during the period from November 24, 2003 to August 27, 2004. However, there is no objective evidence, such as financial evidence, as to the fact that the plaintiff borrowed funds from OO, ED, etc., and the plaintiff received 00 won from HaH Integrated Development between April 23, 2004 to May 18, 2004, and the plaintiff did not seem to have enough financial support to bring the plaintiff's funds into the Corporation. In light of the above facts, the plaintiff's assertion that the money that the plaintiff invested into the Corporation in this case was paid from H integrated Construction, and that the plaintiff's testimony is not reasonable and appropriate, and that it conforms to the witness's assertion that the plaintiff's testimony should not be accepted.

(3) Determination as to the lawfulness of the disposition imposing corporate tax of this case

According to the above facts, it is reasonable to view the Plaintiff’s provisional payment of KRW 000 and KRW 000,000 paid by the Plaintiff to EE, the director of the Plaintiff, and the director of E, the representative of the Plaintiff, as the provisional payment, regardless of the Plaintiff’s business. Thus, it is reasonable to view the Defendant’s provisional payment of KRW 52 of the former Corporate Tax Act (amended by Act No. 9898, Dec. 31, 2009) and Article 88(1)6 and Article 88(3)3 and (5) of the former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 21972, Dec. 31, 2009) to include the amount of interest calculated by calculating the amount of interest to the Plaintiff’s director in calculating the income amount for the business year of 2008 and 2009 as the corporate tax of this case is legitimate (the Plaintiff’s assertion that the Defendant imposed corporate tax of this case on the Plaintiff is unlawful, but it is not justified.

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.