Early High Court Decision 201J 2481 ( April 25, 2013)

A disposition imposing value-added tax by deeming it as a processing tax invoice is legitimate;

A tax invoice shall not be deemed to have been received from the purchaser without the endeavor of the customer to verify the place of business, etc., or to have been actually traded with the customer, or to be a bona fide transaction party, even though he/she is aware that the closed age

2013Guhap6160 Revocation of Disposition of Imposing Value-Added Tax

○ Metal Co., Ltd.

○ Head of tax office

July 23, 2015

August 20, 2015

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The Defendant’s imposition of value-added tax for the second term of March 1, 2009 against the Plaintiff on March 1, 201 shall be revoked.

1. Details of the disposition;

A. From July 6, 2009 to March 29, 2010, the Plaintiff run the ○○○○○○○○○○○○, and from March 30, 2010, ○○○○○○○○○○○, respectively, at the seat of its principal office.

B. The Plaintiff received a purchase tax invoice in an amount equivalent to KRW 4,141,241,250 (hereinafter “each of the instant tax invoices”) in total from ○○○ Commercial, ○○ Resources, ○○ Resources, ○○ Resources, ○○○○○ Commercial, ○○○ Commercial, and ○ Metal (hereinafter “the instant transaction parties”), and filed a return and payment of value-added tax including the input tax amount subject to deduction.

C. On March 1, 2011, on the ground that each of the instant tax invoices was written differently from the fact, the Defendant excluded the input tax amount on each of the said tax invoices from the deductible amount, and subsequently notified the Plaintiff that the value-added tax for the second period of February 2009 was corrected to KRW 712,293,490 (hereinafter “instant disposition”).

D. On the other hand, the Plaintiff filed an objection and filed an appeal, but the Tax Tribunal dismissed the appeal on April 25, 013.

[Reasons for Recognition]

Facts without dispute, entry in Gap evidence 1, 2, Eul evidence 1 (including branch numbers, hereinafter the same shall apply) and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) The Plaintiff wired the purchase price after actually being supplied with the closure of the Dong, etc. from each of the instant transaction parties, and thus, the instant tax invoice is not a false tax invoice.

2) Even if not, the Plaintiff traded after confirming the business registration certificate, the name of the representative, etc. from each of the instant transaction parties, and transferred the price to the account under the name of the representative, etc., and thus, each of the instant transaction parties was taken all measures to verify whether the closed Dong, etc. was actually supplied. Thus, the Plaintiff constitutes a bona fide transaction party.

B. Relevant statutes

The entries in the attached Table-related statutes are as follows.

C. Determination

1) Whether each of the tax invoices of this case is false

A) Relevant legal principles

The meaning that the tax invoice under the Value-Added Tax Act differs from the fact is that the necessary entries in the tax invoice refer to cases where the contents of the requisite entries in the tax invoice do not coincide with those of the person who actually supplied or is supplied with the goods or services, or the price and time of the goods or services, notwithstanding the formal entries in the transaction contract, etc. made between the parties to the goods or services (see, e.g., Supreme Court Decision 96Nu617, Dec. 10, 1996). Furthermore, the burden of proving that the tax invoice constitutes a tax invoice different from the fact is the principle that the tax authority bears the burden (see, e.g., Supreme Court Decision 2008Du973

B) In the instant case:

In light of the above legal principles, in full view of the following facts, the Plaintiff’s entries in each of the tax invoices of this case are different from the facts, and as a whole, the Plaintiff’s tax invoices received from each of the transaction parties of this case shall be deemed to constitute a tax invoice which was prepared to be the actual supplier by means of a disguised transaction without a real transaction, by taking into account the following facts:

① Each of the transaction parties of this case did not have all basic facilities, such as camping stations, valleys, transportation vehicles, etc., and the ○○ Resources, ○○ Commercial Act, and ○○○ Commercial Act was closed ex officio on the grounds that the place of business was not or did not exist without permission. The ○○○○○, the representative of ○○○○○○○○○, and the representative of ○○○○○○○ commercial Act had never operated the business related to the sales of scrap metal before.

② The persons indicated as suppliers in the report on deduction of the input tax amount for recycled waste resources by each customer of the instant case are identified as unrelated to the sales of scrap metal, such as employees, and each customer appears to have stolen personal information while buying or processing non-data.

③ The money paid to each of the instant transaction parties as the price for goods such as closing Dongdong, etc. was transferred to several accounts, and immediately withdrawn in cash. In light of the same type of computer IP address used at the time of transfer from ○○○ Resource, ○○ Resources, ○○ Resources, ○○○○ Resources, ○○○○○○○ Company, and ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○’

④ Each transaction partner of the instant case closed his business at a similar time without paying taxes, after giving excessive sales to a short period by issuing a tax invoice.

⑤ Meanwhile, in filing a final tax return on the amount of value-added tax for the second period of February 2009, both ○○○○, a real operator of the ○○ resource, was indicted for violating the Act on the Aggravated Punishment, etc. of Specific Crimes (Delivery of False Tax Invoice) on the ground that: (a) a false sales tax invoice was issued as if the Plaintiff supplied the scrap metal, etc. to another business entity; and (b) a false sales tax invoice was issued; and (c) a false purchase tax invoice was submitted to the tax authority without being supplied with scrap metal, etc. from ○○○ Company, ○○ Resource, ○

④ Purchase tax invoices received from ○○○○○○ Co., Ltd. (hereinafter referred to as “○○○○○○”) in relation to the value-added tax for the second period of February 2009, which ○○○○○○○○○○ Co., Ltd. (hereinafter referred to as “○○○○○”) operated by the Plaintiff, a partner of the Plaintiff, were confirmed as false tax invoices (in relation to some tax invoices of ○○○ Co., Ltd. and ○○○ Co., Ltd., a partner of the Plaintiff, were not excluded from the purchase deduction amount on the grounds that the value-added tax was corrected based on double tax investigations).

2) Whether the Plaintiff is bona fide and without fault or not

A) Relevant legal principles

The actual supplier and the supplier on a tax invoice may not deduct or refund the input tax amount unless there is any special circumstance that the supplier was unaware of the fact that the supplier was unaware of the fact that the supplier was unaware of the fact that the supplier was unaware of the fact that the supplier was unaware of the fact that the supplier was unaware of the fact that the supplier was unaware of the fact that the supplier was not negligent (see, e.g., Supreme Court Decision 2002Du2277, Jun. 28, 2002). However, in light of the developments leading up to the issuance and delivery of the tax invoice, the size and market price of the goods or services being supplied, the specific route in which the goods or services were supplied, and the trade practice in the relevant industry, the actual supplier was suspected of the fact that the recipient was not aware of the fact that the supplier was unaware of the fact that the supplier was unaware of the location of the workplace, business facilities, or the distribution route of the goods or services supplied under the name of the supplier, and that the supplier’s business registration certificate, etc. confirmed the supplier’s business registration certificate, etc.

B) In the instant case:

As to whether the Plaintiff was unaware of the name of the tax invoice issued by each of the transaction parties of this case and was negligent in not knowing the fact, the following circumstances, i.e., whether the Plaintiff did not know of the name of the tax invoice issued by each of the transaction parties of this case, and the entire purport of the pleadings, namely, ① the Plaintiff’s representative ○○ was sufficiently aware of the fact that the Plaintiff was engaged in the same type of business as the unregistered business operator for about 15 years prior to the establishment of the Plaintiff Company, and the sales business, such as scrap iron, etc., remains low for less than 4 billion won. ② The Plaintiff did not know of the fact that each of the transaction parties of this case did not know of the fact that the Plaintiff did not know of the fact that the Plaintiff had been negligent in not knowing that each of the transaction parties of this case had been equipped with basic facilities such as the guidance for the sale of scrap iron, etc., and that there was no need for each of the transaction parties of this case to confirm whether the Plaintiff did not know that each of the transaction parties of this case was in the Plaintiff’s name.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.