Plaintiff (Law Firm, Kim & Lee LLC, Attorneys Yu-soo et al., Counsel for the plaintiff-appellant)

Korea

March 6, 2008

Seoul Central District Court Decision 2005Gahap65925 Decided July 18, 2007

1. The plaintiff's appeal is dismissed.

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

1. Claim: The defendant shall pay to the plaintiff 55,692,830 won with 20% interest per annum from the day following the delivery date of a copy of the complaint of this case to the day of complete payment.

2. Purport of appeal: The part against the plaintiff in the judgment of the court of first instance shall be revoked. The defendant shall pay to the plaintiff 180,703,412 won with 5% interest per annum from August 12, 2005 to July 18, 2007 and 20% interest per annum from the next day until the day of full payment.

1. Quotation of judgment of the first instance;

The reason why a party member should explain this case is as stated in the reasoning of the judgment of the court of first instance, since it is the same as stated in the reasoning of the judgment of the court of first instance, in addition to the addition of the following additional determination stated in Paragraph 2 after the 16th of the judgment of the court of first instance, Article 420 of the Civil Procedure Act.

2. Additional matters to be determined;

A. The part concerning the retroactive effect of the decision of unconstitutionality

Since the effect of the decision of unconstitutionality is limited to a general case brought before the court on the ground that the law in question was the premise of the decision, if the Constitutional Court, after the issuance of an administrative disposition based on the pertinent law, decides the law that became the basis of the administrative disposition as unconstitutional, it would be the same as that of the act conducted without the legal basis. However, in the case of an administrative disposition which became final and conclusive after the expiration of the period of revocation lawsuit, it shall not be deemed that the retroactive effect of the decision

In addition, the circumstance that the law is in violation of the Constitution cannot be seen as objectively apparent before the Constitutional Court renders a decision of unconstitutionality. Thus, it is reasonable to view that the reason that the law, which forms the basis of administrative disposition before the Constitutional Court renders a decision of unconstitutionality, can only be the premise of the administrative disposition revocation lawsuit, and it does not necessarily constitute a ground for the invalidation of the administrative disposition (Supreme Court Decision 2001Du3181 Decided November 8, 2002).

Therefore, in this case, the second decision of the decision of unconstitutionality rendered by the head of Samsung Tax Office on April 15, 2002 on global income tax belonging to the Plaintiff and the Nonparty for the year 1996 by the head of Samsung Tax Office (the decision of unconstitutionality is made prior to the decision of unconstitutionality by the Constitutional Court Order 2001HunBa82 dated August 29, 2002 under Article 61 (1) of the former Income Tax Act, which served as the basis for the decision of unconstitutionality, was made prior to the decision of unconstitutionality by the Constitutional Court Order 2001HunBa82 dated August 29, 202, so the above second decision of unconstitutionality becomes final and conclusive after the period of revocation lawsuit becomes final and conclusive, and it cannot be deemed that

B. Parts related to appropriation

(1) On April 15, 2002, when the head of Samsung Tax Office revised the second decision on global income tax for the year 1996 by the Plaintiff and the Nonparty, the head of Samsung Tax Office reduced the amount of tax against the Plaintiff to KRW 4,572,432, and at the same time, reduced the amount of tax against the Nonparty to KRW 208,975,528, the amount of tax against the Nonparty was deducted by KRW 4,532,432 from the Plaintiff’s already paid tax amount and notified the Nonparty of KRW 42,31,425.

In regard to this, the Plaintiff’s correction of the Plaintiff’s tax amount to KRW 4,572,432 as above by the head of Samsung District Tax Office was erroneous in appropriating the difference calculated by deducting KRW 4,572,432, which is the legitimate tax amount, from the already paid tax amount, to the Nonparty’s tax amount. Moreover, the Plaintiff asserts that the said appropriation has no effect because the Samsung Tax Office did not notify the Plaintiff of the aforementioned appropriation.

(2) However, Article 2 (3) of the former Income Tax Act at the time when the head of Samsung Tax Office revised the second decision on April 15, 2002 as of April 15, 2002, provides that "the principal income earner and his spouse shall be jointly and severally liable for tax on property income subject to cumulative taxation pursuant to Article 61." Therefore, even in cases where the principal income earner is changed in the marital aggregate taxation method, the liability for tax payment was jointly and severally liable for tax payment. As such, the Plaintiff still was jointly and severally liable for tax payment of the non-party in 1996 when the principal income earner changed from the Plaintiff to the non-party. Thus, the Defendant was liable for tax payment of the non-party in excess of the above amount of tax paid by the plaintiff to the non-party. In other words, the remainder after deducting the amount of tax paid by the plaintiff from the plaintiff's tax amount to the non-party at the time of the decision of unconstitutionality of Article 2 (3) of the former Income Tax Act, which was based on the second decision of 6.

Ultimately, the plaintiff's assertion that the excess amount paid by the plaintiff was appropriated for the amount of tax to be paid by others is groundless.

3. Conclusion

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

Judges Cho Jae-hee (Presiding Judge)