Seoul High Court 2008Nu10869 ( October 28, 2008)

Seoul Administrative Court 2007Guhap35203 ( October 26, 2008)

propriety of a disposition not to deduct the input tax amount of the tax invoice received from data

If there is no specific document evidencing the fact that the tax invoice delivered is a real transaction, and if the entrepreneur who issued the tax invoice considers the data merchant, it is difficult to see that he/she has purchased the tax invoice now, it is legitimate

The contents of the decision shall be the same as attached.

Article 17 of the Value-Added Tax Act

The appeal is dismissed.

The costs of appeal are assessed against the Plaintiff.

All of the records of this case and the judgment of the court below and the grounds of appeal were examined, but the assertion on the grounds of appeal by the appellant falls under Article 4 of the Act on Special Cases Concerning the Procedure of Appeal, and thus, the appeal is dismissed under Article 5 of the same Act. It is so decided as per Disposition by the assent

[Seoul High Court Decision 2008Nu10869 ( October 28, 2008)]

1. The plaintiff's appeal shall be lodged.

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

The judgment of the first instance shall be revoked. The defendant shall revoke the disposition of imposition of value-added tax of KRW 7,444,480 for the first term of August 1, 2006 against the plaintiff on August 1, 2006.

The court's explanation on this case is identical to the entry of the judgment of the court of first instance, and thus, it also cites this case in accordance with Article 8 (2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act.

Therefore, the judgment of the court of first instance is legitimate, and the plaintiff's appeal is dismissed as it is without merit. It is so decided as per Disposition.

[Seoul Administrative Court 2007Guhap35203, 2008)]

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of imposition of value-added tax amounting to KRW 7,444,480 for the first term of 2003 against the Plaintiff on August 1, 2006 shall be revoked.

1. Details of the disposition;

A. From October 5, 191, 191, the Plaintiff is a business entity that has run ○○○○○ ○○○○○ ○○○○○○ ○○○○○○○○ dong, and is a business entity that has run ○○○ ○○ ○○○ dong, clock, and precious metal wholesale business, and the Plaintiff is a business entity that runs ○ ○○ ju ju (hereinafter referred to as “○ ○○ ju”) in 206 ○ ○ ○○ dong ○○ dong ○○ dong ○○ dong, ○○ dong ○ dong ○ ○

No.

Date of transaction

Quantity

1g unit price per unit (won)

Value of supply (cost)

Amount of tax (source)

Total (won)

1

April 10, 2003

1,000g

12,703.030

12,703,030

1,270,303

13,973,33

2

may 6, 2003

1,000g

12,824.242

12,824,242

1,282,424

14,106,666

3

May 14, 2003

1,000g

13,226.66

13,226,66

1,322,666

14,549,332

4

May 29, 2003

1,000g

13,624.515

13,624,242

1,362,424

14,986,666

guidance.

4,000g

——

52,378,180

5,237,817

57,615,997

B. The Plaintiff received four tax invoices (hereinafter “instant tax invoices”) equivalent to the total supply amount of KRW 52,378,180 as the following tax invoices during the taxable period of the value-added tax in January 2003 by deducting the value-added tax amount on the said tax invoice as the input tax amount, and filed a value-added tax return by deducting the value-added tax amount on the said tax invoice as the input tax amount.

C. On August 1, 2006, the Defendant deemed that the instant tax invoice was not consistent with the actual transaction and deducted the relevant input tax amount. On August 1, 2006, the Defendant issued a revised and notified the Plaintiff of the value-added tax amounting to KRW 7,444,480 (including additional tax) for the first period of 1st, 2003 (hereinafter “instant disposition”).

Facts without any dispute over recognition, Gap's 1 and 2, Gap's 3-2, Gap's 4, Eul's 1, and the purport of the whole pleadings.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

As stated in the instant tax invoice, the Plaintiff actually purchased the present tax invoice from ○○ △△△, and received the said tax invoice after paying the price in full. Therefore, it is apparent that this would result from a normal transaction. Therefore, the Defendant’s disposition of this case, which is premised on the receipt of the instant tax invoice through a processing transaction without a real transaction, is unlawful.

(b) Related statutes;

Article 17 of the former Value-Added Tax Act (amended by Act No. 8826 of Dec. 31, 2007)

(1) The amount of value-added taxes payable by an entrepreneur shall be the amount computed by deducting the tax amount under the following subparagraphs (hereinafter referred to as "purchase tax amount") from the tax amount on the goods and services supplied by him/her (hereinafter referred to as "sales tax amount"): Provided, That where an input tax amount exceeds the output tax amount, it shall be a refundable tax amount (hereinafter referred to as "return tax amount"):

1. The tax amount for the supply of goods or services used or to be used for his own business;

2. The tax amount for the import of goods used or to be used for his own business; and

(2) The following input taxes shall not be deducted from the output tax amount:

1. An input tax amount in case where the list of the total tax invoice by customer is not submitted under Article 20 (1) and (2), or the input tax amount on the portion not entered or entered differently from the fact, in case where the whole or part of the registration numbers or supply values by transaction parties in the submitted list of the total tax invoice by customer is not entered or entered differently from the fact, excluding the input tax amount in such

1-2. An input tax amount, in case where the tax invoice as provided in Article 16 (1) and (3) is not delivered, or the whole or part of the matters to be entered under Article 16 (1) 1 through 4 (hereinafter referred to as a “necessary entry item”) is not entered or entered differently from the fact on the delivered tax invoice: Provided, That the input tax amount in such case as prescribed by the Presidential Decree shall be excluded;

(c) Fact of recognition;

(1) The details of value-added tax reported by the Plaintiff from January 2001 to February 2005 are as follows. Of the sales amount of 84,620,101, the sales amount of credit card transactions among the sales amount of 1st year 2003, the time when the tax invoice of this case was issued, the sales amount of 60,893,000 won, which is 72% of the total sales amount, and the purchase amount of 64,932,998 won during the same period, which is 52,378,180 won, which is 80.7% of the total purchase amount.

Taxation Period

Sales (cost)

Purchase amount (cost)

Amount of tax payable ( won)

1, 2001

16,756,000

12,144,00

461,200

2, 2001

15,051,000

10,294,470

475,654

1, 2002

15,456,400

10,058,000

539,840

2, 2002

16,223,500

11,476,183

474,734

1, 2003

84,620,101

64,932,998

1,968,712

2 2003

41,253,000

29,106,157

1,214,686

1, 2004

18,385,455

12,658,250

572,720

2, 2004

11,240,909

6,748,910

49,200

1, 2005

15,520,000

10,430,739

508,929

2, 2005

8,697,000

5,612,550

308,450

(2) In January 2003, 2003, ○○○○ Trade, ○○○ Trading, ○○○ Trading (State), ○○○○, and ○○○○○○, etc., purchased a total of KRW 214,036,00,000, and filed a report that sold (State) ○○○○ and 21 businesses.

(3) However, ○○ Trade is an enterprise recognized as material as a result of the investigation by the National Tax Service of ○○○○○, and ○○○○○○○○, and ○○○○○, also recognized as data as a result of the investigation by the competent tax office, and ○○○, out of the purchase amount of 1 January 2003, 9.9% (214,018,000,000) of the amount that ○○○○ purchases from the said enterprise.

(4) As a result of investigating ○○○ tax office’s suspicion, the sales tax invoice amounting to 81.3% of the sales amount was issued to (ju) ○○○○ and 21 companies, and most of the sales offices were identified as an enterprise with criminal records, such as data. However, on October 27, 2005, the (ju) ○○○○ was subject to a disposition from the District Prosecutor’s Office of the Northern District Prosecutors’ Office on ○○ on 2005.

(5) On March 2, 2006, the head of ○○ Tax Office received most of the purchase tax invoices from the company accused of the purchase tax invoices from March 5, 2001 to December 31, 203. The sales tax invoices issued by ○○○○ Accounting Office filed a complaint against ○○○○ and its representative ○○○○ on the grounds that the sales tax invoices were processed tax invoices, but the indictment was suspended due to the unknown whereabouts of ○○○○.

(6) On the other hand, the Plaintiff deposited each corresponding amount into the account of ○○△△△△ on the date of each transaction on the instant tax invoice. The Plaintiff’s ○○○ trade, ○○○, and ○○ Trading (State) that was accused of the material within several minutes after being deposited by the Plaintiff immediately after being deposited by the Plaintiff.

Deposit Date

Amount of entrance fees (won)

○○ Meice dice sing date and time of withdrawal

Agency of Payment

April 10, 2003: 14:35:03

13,973,00

April 10, 2003: 43:23

(state)○ trade;

May 6, 2003: 10:54

14,106,00

May 6, 2003: 17:1

○ Tracing (State)

May 14, 2003: 15:49:28

14,549,000

May 14, 2003 15:53:38

○ Tracing (State)

May 29, 2003: 52:52

14,986,00

May 9, 2003: 16:04:41

○ Tracing (State)

The details of deposits into the account are as follows.

Facts without any dispute over recognition, Gap evidence 2, Eul evidence 3-2, Gap evidence 5-1 through Gap evidence 6-8, Eul evidence 2, 3, Eul evidence 6-1 through Eul evidence 6-7, the purport of the whole pleadings, and the purport of the whole pleadings.

D. Determination

(1) The burden of proving that the tax invoice is false, in principle, to the defendant who is the tax authority, and the defendant must prove that the tax invoice is not accompanied by real transactions on the basis of direct evidence or all the circumstances. If the defendant proves that the tax invoice is not false and that it is not accompanied by real transactions, it is necessary to prove that it is consistent with his/her own assertion in light of the position that it is easy to present evidence and materials related to the plaintiff who is the taxpayer who disputes the illegality of the defendant's disposition, by asserting that the tax invoice is not false (see, e.g., Supreme Court Decision 96Nu8192, Sept. 26, 1997).

(2) According to the above facts, it appears that 00 juice did not actually trade real assets, and in particular, it appears that 2003 juice purchase portion appears to have been processed, it is reasonable and acceptable to view that the tax invoice of this case is false that it is not accompanied by real transactions. Therefore, the Plaintiff should prove that the tax invoice of this case was supplied normally from 0 juice. In general, even in case of material and processing transactions, the Plaintiff should prove that the purchase price was first deposited from 0 juice in order to pretend the issuance of the tax invoice to be actual transactions, the remainder after deducting some fees would be remitted to 0 juice, and the remaining amount after deducting the commission from 0 juice would be returned to 0 juice. In particular, it cannot be concluded that the Plaintiff's purchase price was a real transaction without being issued a false credit card purchaser's purchase price or a new credit card purchaser's purchase price to 20 juice because it is in the form of cash again.

In light of the fact that credit card users who traded with the Plaintiff did not respond properly to the confirmation of the Defendant’s fact of transaction or did not contact (Evidence No. 2), etc., each entry in the evidence Nos. 9 and 10, which corresponds to the Plaintiff’s assertion, is not believed, and the Plaintiff deposited the price on the tax invoice of this case (Evidence No. 5-1 through 4, No. 12), or the Plaintiff sold credit card transactions (Evidence No. 8-1 through No. 12) corresponding to the amount on the tax invoice of this case at the time of January 2003, or there is no other evidence to acknowledge that the transaction of this case constitutes real transaction on the tax invoice of this case by itself, as stated in the evidence No. 7-1 through 6, and No. 11-1 and No. 2 submitted by the Plaintiff.

Therefore, the instant disposition that deemed the instant tax invoice as the processed tax invoice is lawful, and the Plaintiff’s assertion disputing this is not acceptable.

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.