The preferential capital reduction shall not be included in the calculation of income dividends, because it is not deemed that the consideration for comprehensive business acquisition is not paid.

First of all, there is no circumstance that the capital reduction agreement aims at tax avoidance, and the capital reduction agreement cannot be regarded as a comprehensive business settlement amount, so it is reasonable to exclude the dividend from income.

Article 18-2 of the Corporate Tax Act

2015Guhap5703 Revocation of Disposition of Corporate Tax Imposition

○○○ Incorporated Company

○ Head of tax office

on January 13, 2018

November 22, 2018

1. As to the Plaintiff:

(a) Corporate tax*,**,*,**,**,**,**,**,** (this tax*,**,**,**,***,**,**,**,**,***,***,**) in the disposition of imposition of*,**,***)*,***,*** (this tax***,***,**,****,*****,*****************************

Parts exceeding Busan****,***,******) and the principal tax of the corporate tax for the business year 2008*****,***,**** in the disposition of imposition of KRW*,*****,**** in excess of KRW;

(b) Additional corporate tax*,**,*,**,** in the disposition of imposition of KRW 208, 208, **.

*******,****** respectively.

2. The costs of the lawsuit are assessed against the defendant.

Cheong-gu Office

The same shall apply to the order.

1. Details of the disposition;

A. On April 1, 2002, the Plaintiff is a corporation established by dividing “Electronic and Information and Communications Business” from AA Co., Ltd. on a personal basis. On January 24, 2005, the Plaintiff entered into a joint venture agreement with BB (hereinafter “B”) which is a network equipment company located in Canada to carry out a joint venture in the field of telecommunications equipment and network, on August 17, 2005, respectively. On October 13, 2005, the Plaintiff entered into a joint venture agreement (hereinafter “joint venture agreement”) with the Plaintiff, a domestic corporation, based on the Commercial Act of the Republic of Korea (hereinafter “non-foreign corporation”); or (b) the director of the Seoul Regional Tax Office entered into a joint venture agreement with the Plaintiff in accordance with the corporate tax investigation report in the business year from 2007 to 2011.

In addition, the Plaintiff’s calculation based on the calculation of unfair act method method method method method method method method method method method method method method method method method method method method method method method method method method method method method method applies to the Plaintiff’s excessive payment of sales incentives to EE Co., Ltd. in the business year 2007 to 2009. ③ The amount calculated by applying normal rate method method to the Plaintiff’s payment guarantee fee received from a foreign subsidiary in the business year 2007 to 201 as it applied to the calculation of earnings; ④ the Plaintiff’s retirement of the shares held by the non-party corporation in the form of profit retirement method, but its substance cannot be deducted from the acquisition price of the retired shares due to the same as cash dividend, shall be deemed to be the dividend amount for the business year 208, 2009, and ⑤ the Plaintiff’s sales proceeds received from the non-party corporation in the business year 207 and 2008 as the dividend amount under Article 281(1) of the former Corporate Tax Act (amended by Act No. 26861 of the Plaintiff’s.

C. Accordingly, on November 30, 2012, the defendant notified the plaintiff of the correction of the corporate tax for the business year 2007 *,***,**,***,***,**,**,**,**,**,**,**,*,**,*,*,*,**,***,** (including additional tax).

2) On July 2, 2010, the non-party corporation registered its trade name as “FF Co., Ltd.” and on September 5, 2012 as “GG Co., Ltd.” respectively.

D. The Plaintiff appealed and filed an appeal with the Tax Tribunal on March 8, 2013, and tax.

On December 17, 2014, the Tribunal determined that the grounds (i), (ii), (iii), (iv), and (v) were lawful. Meanwhile, on March 18, 2014, the Defendant increased the corporate tax of KRW 3,950,80 to the Plaintiff for the business year 2008.

E. On January 2, 2015, according to the decision of the Tax Tribunal, the Defendant: (i) the Plaintiff; and (ii) the reasons therefor.

Corporate tax of the business year 2007*,**,**,*****(including additional tax) and a corporation of the business year 2008.

Gu tax**,**,**,**,*****(including additional tax) respectively.

F. The Plaintiff’s judgment that the Tax Tribunal was lawful among the initial grounds for disposition (3), (4), and (5)

The Defendant brought a lawsuit of this case on the ground that it was unlawful, and the Defendant continued to proceed with the lawsuit of this case.

③ With respect to the Plaintiff on September 11, 2018, upon acceptance of the Plaintiff’s assertion as to the grounds for disposition:

The corporate tax for the business year 2007 *,******,*** (this tax***,***,****,**, penalty tax**,***,***,***,***,*,*,**,*,**,** (this tax*,***,***,****,***,**,***,**,***,****,****) after each reduction (hereinafter referred to as the original disposition) was corrected (hereinafter referred to as the original disposition * corporate tax for the business year 207 ******,**************,*****,****,****,***,***,***,***,**,**,***,***,**,**,**,***,**,***,**,****** for the business year 20.*****.***.

[Ground of recognition] Unsatisfy, Gap evidence 1 to 3, Eul evidence 1, 2, 57 (each provisional lot number)

each entry, the purport of the whole pleading

2. Whether the instant disposition is lawful

A. The parties' assertion

1) The plaintiff's assertion

The agreement on the redemption and reduction of preferential shares concluded on August 17, 2005 between the Plaintiff and B and the non-party corporation is an independent agreement separate from the investment agreement entered into between the Plaintiff and BB. As to the key amount paid by the non-party corporation in the year 2007 and 2008 after undergoing the procedure for the reduction of the paid amount under the Commercial Act in accordance with the priority share agreement, the provision on the exclusion of income dividends under Article 18-3(1) of the former Corporate Tax Act shall apply. However, without individual and specific denial provisions, the Defendant did not fall under the instant exceptional transaction form consisting of tax avoidance, even if the priority share agreement, etc. does not fall under the instant transaction form consisting of tax avoidance, the Defendant denied the legal form chosen by the parties and excluded the application of the provision on the exclusion of income dividends to the key amount by deeming the amount received by the Plaintiff as the business transfer cost without permission.

Therefore, among the dispositions in this case, the portion in excess of corporate tax*,**,**,**,*,***,*** (this tax*,**,**,**,**,**,**,**,**,*,**,*) and corporate tax*,*,**,**,**,***,**** (this tax****,**,**,**)) in the business year of 2008, which is reasonable tax amount in the case of applying the provision on exclusion from taxable income of import dividends under Article 18-3 (1) of the former Corporate Tax Act to the outstanding amount of the disposition in this case.

2) The defendant's assertion

The key issue is that the first priority agreement constitutes a part of the investment contract, which aims at the ex post facto settlement of the transfer price of the Plaintiff’s network business unit. At the same time, BB requires the Plaintiff to pay the transfer price to the Plaintiff via the non-party corporation, the first priority agreement is concluded to complete the joint control scheme by dividing two weeks each by the Plaintiff and BB. In view of the fact that the nature of the key money was recognized as the transfer price of the business by Earn-out method, and that the Plaintiff’s goodwill was not separately assessed in the process of transferring the business of the Plaintiff and the non-party corporation, the key money is deemed to have been actually paid to the Plaintiff for succession to business rights. Furthermore, the purpose of tax avoidance is to determine the issue of whether the tax burden of the non-party corporation, the transferee of the business, was reduced by reducing the transfer price of the business through the agreement for exclusion from taxable income, etc., and thus, it is not recognized that the Plaintiff’s sales from taxable income was reduced by the transfer price of the non-party corporation after the issuance of the dividend.

B. Relevant statutes

It is as shown in the attached Form.

(c) Fact of recognition;

1) The main contents of the key investment contract concluded on August 17, 2005 by the Plaintiff and BB are as follows.

Clerks

The Plaintiff and B establish a joint venture (foreign corporation) and run an electronic communications infrastructure project in the Republic of Korea through the non-party legal entity, and cooperates with the non-party legal entity so as to be the main owner of the electronic communications infrastructure project, and further, through the non-party legal entity, the benefit of the Plaintiff and the Nortel from the above project.

of this chapter.

Article 1 Definition Clause

1.1 Terms

“Preferred Shares” means Non-Party Corporation’s non-voting rights, non-participating rights, non-exclusive priority rights, and the face value per share is KRW 5,000. The Preferred Shares are entitled to preferential payments of 1% of the face value, and detailed provisions thereof were written in the articles of incorporation of Non-Party Corporation.

7.2. Plaintiff’s investment

When the transaction is closed, the plaintiff shall invest the plaintiff's invested assets in the non-party corporation on the day after the day from the date of the transaction is closed in accordance with the terms and conditions of the investment transfer contract, and the non-party corporation shall issue to the plaintiff the number of shares and four priority shares agreed to by the parties.

7.3. Sale and purchase of Plaintiff’s assets;

Upon the completion of transaction, the plaintiff shall transfer assets to the non-party corporation under the conditions stipulated in the investment transfer contract.

(c) Although the "subsidiary contract" of the investment contract listed in Section 1.1.1 includes the investment transfer contract in Section 3 below and the corresponding Norte sales contract, the priority agreement in Section 2 below is not included.

2) On August 17, 2005, the Plaintiff and Nortel and the non-party corporation entered into a key share agreement on August 17, 2005, along with the date of the instant investment contract, which is the agreement on the procedures for redemption and reduction of capital among the 4 weeks of the priority that the Plaintiff was to be paid pursuant to the instant investment contract, and the specific content is

Clerks

The Plaintiff shall be paid a certain amount according to the first year (2006) and the second year (2007) management performance of the non-party corporation as part of the transaction considered in the key investment contract. For this purpose, the non-party corporation shall issue four first week to the Plaintiff.

Article 2 (Reduction of Capital)

Where the requirements to receive redemption price pursuant to attached Table 1 are met, the Plaintiff shall repurchase the first share of the preferred stock owned by the Plaintiff to the non-party corporation at an adequate redemption price, and the non-party corporation shall purchase and retire it, and thereby implement the necessary procedures for reduction of capital: Provided, That the payment of redemption price to the Plaintiff shall be postponed until the non-party corporation can pay the redemption price, as the payment of redemption price is made after the non-party corporation acquired the first share of the new issuance price

Article 3 (Preferential Subscription)

Upon completion of all the procedures, such as court registration related to reduction of capital, pursuant to Article 2 (at least 21 days) the Plaintiff and Nortel implement the necessary procedures so that the non-party corporation may issue new priority shares to Norl, and BB takes over the same price as the redemption price above.

Article 4 (Transfer of Preferential Shares)

If there is no redemption price (if the redemption price is zero won) under the attached Form 1, the plaintiff shall transfer to BB without compensation for the first share. In addition, if the amount requested by creditors who have an objection to the reduction of the capital of a non-party corporation under Article 2 above exceeds one billion won, the non-party corporation shall immediately cancel the reduction of the capital and the plaintiff shall increase the first share to BB as the redemption price above, and the BB shall take over it.

[Attachment 1] Redemption Price of Preferred Shares

① The preferential repurchase price in 2007 shall be calculated as follows based on the domestic sales revenue of the non-party corporation in 2006, and if the domestic sales revenue of the non-party corporation in 2006 exceeds 60 billion won, it shall be 60 billion won, and 480 billion won if it falls short of 480 billion won.

② The preferential repurchase price in 2008 is the sum of the prices calculated by the above-mentioned methods as of the internal sales revenue of the non-party corporation in 2007 and the prices calculated by the following formula. The aggregate of the repurchase price in 2007 and 2008 shall be US$ 80 million.

3) Meanwhile, as one of the subsidiary contracts to the instant investment contract, the major contents of the investment transfer contract (Sale Anditribation A. hereinafter “instant investment contract”) concluded on October 26, 2005 between the Plaintiff and the non-party corporation include “where the Plaintiff transfers the business by means of investing in kind all of the network business units in the non-party corporation, the non-party corporation issues new shares of 2 million won and pays 9,99,99 shares (which remains after subtracting 1 share from 50%) among them, 40,000 dollars (which is equivalent to 1,5116,000,000 won) and 14,50,000 dollars (which is equivalent to 1,510,000 won) among the Plaintiff and the non-party corporation. In addition, Article 2.1(a) of the instant investment contract provides that “the right to business in the assets subject to transfer” includes 1,000,000 won among the non-party corporation 3B investment parties.

4) Article 2.5 of the instant investment contract provides for the adjustment of outstanding amounts after the closing of transaction. This means that “The Plaintiff’s business division’s amount multiplied by two times a certain rate (125/360) of sales in six months prior to the closing date of transaction shall be considered as “the target sales claim”, and that “if the value of actual sales claim falls short of the value of actual sales claim at the closing date of transaction, the difference shall be deemed to have been paid in excess of the value of actual sales claim, and thus, the Plaintiff shall pay it to the non-party corporation.”

5) On November 2, 2005, pursuant to the key investment contract and key investment contract, the Plaintiff transferred tangible assets, such as sales bonds, investment stocks, and machinery and equipment, in the network business division by the method of investment in kind, and other assets, including goodwill, to the non-party corporation by the method of business transfer. In return, the non-party corporation’s stocks (ordinary share 99,999, and priority share 4,000,000,000,000 won (15.16,000,000) were paid for the remaining assets subject to the transfer of business. Accordingly, the Plaintiff appropriated the total amount received in return for the transfer of investment in the network business division from the non-party corporation by 30,444 billion won (ordinary share 99,999,944, preferential share 1,5400,000,0000 won less the appraised value of the assets, 1.5.2.6 billion won, 2.5 billion won, 5.5 billion won,000,00 million won.

6) On January 20, 2006, the OO accounting firm prepared a review service report (Evidence A 11) on November 2, 2005, on which the Plaintiff transferred the network business department to the non-party corporation as the base date for appraisal. According to the above report, if it evaluates the value of the Plaintiff’s business assets based on the base date for appraisal pursuant to the future cash flow method, the sales in 2006 are presumed to be KRW 60,006 billion, and the sales in 2007 to be KRW 623,00,000,000,000 won, and the total value of the above business division is KRW 288,15,600,000.

7) As of the closing date of transaction, it was found that the value of the sales claim transferred by the Plaintiff was below the target sales claim value, and the Plaintiff paid KRW 3.96 million, which is the amount equivalent to the difference, to the non-party corporation in the business year 2006 pursuant to the outstanding amount adjustment clause after the completion of transaction at issue. The non-party corporation adjusted the assets, liabilities and business rights of the network business division invested and transferred by the Plaintiff as shown below on the ground that the cost of business transfer decreases ex post facto.

8) The domestic sales revenue of Non-Party Corporation in the first five year (2006) were KRW 568.26 billion and KRW 78.9 billion in the second year (2007) constituted annual internal sales revenue of KRW 480 billion as the requirement that the Plaintiff would be entitled to receive the redemption price of the first class (200.3 billion). The non-party corporation held a temporary general shareholders' meeting on May 2, 2007 and held USD 29,421,66.67 on the same amount as USD 30.3 billion in the first class (20.3 billion in the first class) and held USD 78 billion in the first class (29,426.67 in the first class) and held USD 30.3 billion in the first class (3 billion in the first class) and held the same amount as USD 305 billion in the first class (30.3 billion in the first class) and held the same amount as USD 29,4216.67.6.7

Meanwhile, the non-party corporation, as seen above, appropriated the difference between the decreased capital (amount of KRW 5,00) and the amount paid as the price for reduction of capital as losses in the reduction of capital, and disposed of the retained earnings in the shareholders' meeting held in each business year (as indicated below, March 28, 2008 and March 31, 2009) as stated in the table below (No. 47-1). Meanwhile, the non-party corporation, as seen above, appropriated the excess of the issued stocks received in excess of the capital by issuing two shares per priority share to BB as above, in the item of capital surplus.

9) As above, the Plaintiff calculated the amount of KRW 79.7 billion in total ( KRW 27.294 billion in 2007, KRW 52.4 million in 2008, KRW 52.480 million in 2008) that was paid to the non-party corporation as the preferred capital reduction profit as the investment asset disposal profit. After considering the same amount as the constructive dividend for the business year 2007 and 2008, it applied Article 18-3(1) of the former Corporate Tax Act at the time of filing a corporate tax return for the business year 2007 and 20.3 billion in total ( KRW 28.45 billion in 2007, KRW 12.872 million in 2007, KRW 15.473 million in 2008 in 208, and KRW 3 million in 200,000 in 2

[Ground of Recognition] Facts without dispute, Gap evidence 4 through 6, 11, 18 through 21, Eul evidence 17, 46, and 47 evidence (including each branch number), the purport of the whole pleadings

D. Determination

1) Relevant legal principles and issues

A) Comprehensively taking account of the language and structure of Articles 18-2(1) and 18-3(1)1 and 18-3(1)2 of the former Corporate Tax Act, “import dividends received from another domestic corporation invested by a domestic corporation subject to exclusion from income pursuant to Article 18-3(1) of the former Corporate Tax Act” refers to “an amount of profit earned by acquiring corporate stocks, etc. by investing in another domestic corporation and in proportion to equity shares, etc. of another domestic corporation in the position of stockholders, etc., and an constructive amount of dividend or distribution under Article 16 (see Supreme Court Decision 2015Du48693, Jan. 12, 2017). The purpose of Article 18-3(1) of the former Corporate Tax Act, which provides for a corporate shareholder to exclude a specified amount of dividends from the income of a corporate shareholder, is to relieve the corporate income of a corporation through the tax adjustment imposed in sequence at the corporate level and the stage of the corporate shareholder (see Supreme Court Decision 2015Du41515, Jul. 115, 2017).

B) Article 14(2) of the Framework Act on National Taxes provides that “The provisions on the calculation of tax base in tax-related Acts shall apply mutatis mutandis to the substance of income, profit, property, act or transaction, notwithstanding the name or form of such transaction.” This principle is a practical principle for realizing the principle of equality, which is the basic ideology of the Constitution, in a tax-related relationship. In a case where unreasonable form or appearance separate from the substance of the fact requiring taxation is taken for the purpose of avoiding the burden of taxation, the main purpose of this principle is to regulate unfair tax evasion and realize tax justice by imposing tax on a place where the taxable capacity exists, regardless of its form or appearance, and by enhancing the equity of taxation (see, e.g., Supreme Court en banc Decision 2008Du8499, Jan. 19, 2012). However, a taxpayer may arbitrarily choose any legal form to achieve a specific economic objective, and the tax authority may not easily choose any transaction in accordance with the legal relationship between the taxpayer and the taxpayer’s liability for tax payment, etc., by taking account of the form or appearance of loss (see, 271).).

C) In the instant case, the issue is whether the Plaintiff’s substance of the key money received in the form of compensation for redemption of preferential stock and reduction of capital in accordance with the instant priority agreement is only the appearance that the Plaintiff acquired in the form of compensation for the preferential stock reduction for the purpose of tax avoidance, i.e., whether the legal form chosen by the Plaintiff should be deemed to constitute an act of tax avoidance, and whether the application of the provision on exclusion of income dividends under Article 18-3 of the former Corporate Tax Act is impossible on the ground that the substance of the key money is business transfer proceeds.

2) Determination on issues

In full view of the facts acknowledged earlier and the overall purport of the pleadings, the issue amount the Plaintiff received from the non-party corporation in return for the retirement for the preferential share constitutes dividend income under Article 18-3(1) of the former Corporate Tax Act, and the circumstances cited by the Defendant alone cannot be deemed as having received the key amount as the cost of business transfer by concluding a priority agreement, etc. only formally for the main purpose of tax avoidance and actually receiving the key amount as the cost of business transfer. Therefore, it is unlawful for the Defendant to view the substance of the key amount in the instant disposition as the cost of business transfer and exclude the application of Article 18-3(1) of the former Corporate Tax Act. The Plaintiff’

① Although the key issue is a contract stipulating the detailed contents of the Preferred Shares to be issued in the key investment contract, whether the requirements for redemption of the Preferred Shares are met or not does not directly affect the contents or validity of the relevant investment contract. The key issue is only the possibility that the Plaintiff may additionally receive money according to the sales amount after the establishment of the non-party corporation and the specific amount thereof. On the other hand, the key issue of the investment contract, which is the key investment contract, provides that the Plaintiff shall pay the amount of insufficient money to the non-party corporation in the event that the amount of sales bonds scheduled to be paid at the time of the transfer to the non-party corporation falls short of the target amount as of the closing date of the transaction, and shall adjust the amount after the ex post facto payment of the transfer price. In light of the fact that the Plaintiff, BB, and the non-party corporation, 200,000 won, which is the actual amount of sales bonds after the closing of the transaction, 90,000,000 won, which is 10,0000 won,000 won,00 won.

② “Earn-out” means a contract under which a certain company will have the future profit expected to arise in the company divided between the transferor and the transferee, and the amount paid based on the Earn-out method is considered to have many cases similar to the nature of the transfer price. However, the content of an individual agreement concluded between the transferor and the transferee may be determined in a variety of ways according to various factors, such as the calculation method of the amount to be paid, the price relationship, the relationship between the transferor and the transferee, whether the transferor is in the management of the transferor after the completion of the transaction, the degree of uncertainty on the payment of the amount, and the degree of uncertainty on the payment of the amount. Since the amount paid by the Earn-out method is not calculated based on the objective evaluation amount of the business asset constantly transferred, it cannot be readily concluded that the amount paid after the Earn-out method is the transfer price.

The key issue is that the Plaintiff’s priority agreement provides that the amount of future sales for two years immediately after the Plaintiff invested and transferred the network business department to the non-party corporation, namely, the amount that the Plaintiff can receive from the non-party corporation based on the business performance. Even if the key money is not additionally paid as above, the Plaintiff already received an appropriate amount with the transfer proceeds of the network business division and completed detailed settlement; the key money is an additional business transfer agent.

If payment is made in gold, the minimum sales to be paid shall be deemed to be equivalent to the Plaintiff’s sales amount of 2006 KRW 600.6 billion, and the sales amount of 2007 KRW 623 billion, which was predicted by the O Accounting Corporation in assessing the value of the Plaintiff’s assets of the Plaintiff’s network business. In light of the fact that the priority agreement provides that the redemption requirement of the Plaintiff’s priority-based redemption as owned by the Plaintiff is lower than annual domestic sales amount of KRW 480 billion, it appears that the issue amount is similar to the piece-based bonus or bonus that the Plaintiff agreed to additionally pay to the Plaintiff while expecting to contribute to the Plaintiff’s business activities.

③ Even when considering that the nature of the key money, as alleged by the Defendant, can be deemed to have been paid to the Plaintiff as the cost of the transfer of the Plaintiff’s business division, it is insufficient to recognize that the legal form chosen by the parties to the transaction, including the Plaintiff, arose from the purpose of tax avoidance solely on the grounds of the Defendant’s assertion. If the nature of the key money is deemed as the dividend income from the capital reduction, it is clear that the corporate tax borne by the Plaintiff is reduced compared to the case where the amount is deemed as the cost of business transfer. However, in such cases, the Plaintiff, the non-party corporation, and the non-party corporation are in a special relationship, and the parties to the transaction appear to form a transaction in the direction of minimizing the burden of tax burden throughout the entire transaction. From the perspective of BB, there is no reason to cooperate in forming a transaction in the direction of reducing the amount to be borne by the Plaintiff even when considering the increase in the tax burden to be borne by the non-party corporation, the overall interest of the transaction parties should be considered in determining whether there was tax avoidance purpose.

④ It seems that the Plaintiff, who made an investment in kind and a transfer of business, actively cooperate in the business of the non-party corporation, was in need of business to receive managerial assistance, and this seems to have also been the same from the standpoint of BB that established the non-party corporation jointly with the Plaintiff according to the pertinent investment contract. Therefore, the aforementioned transaction parties, at the time of the establishment of the non-party corporation under the pertinent investment contract and the key issue priority agreement, shall issue four weeks a priority to the Plaintiff at the time of the establishment of the non-party corporation, and the BB shall acquire one of them in 207 and 2008, and it is deemed that the amount that the Plaintiff is entitled to receive at the time of the reduction of the preferential share would not vary in proportion to the sales amount of the non-party corporation up to that time. Furthermore, it does not appear that the said transaction parties, by paying a kind of performance bonus to the Plaintiff, who is the shareholder of the non-party corporation, would have

⑤ The Defendant’s assertion that “the problem of double taxation does not arise in relation to the amount of the issue because the non-party corporation paid the amount to the Plaintiff with the capital surplus (the capital surplus) that the non-party corporation issued to BB in return for the reduction of the capital of the two priority shares held by the Plaintiff.” On the other hand, the amount that the non-party corporation received was appropriated in the items of capital surplus (the capital surplus).” The Defendant’s argument that “The issue of double taxation does not arise because the non-party corporation paid the amount to the Plaintiff with the amount above the par value (the capital surplus) that is not paid for the issuance of stocks that the non-party corporation did not pay corporate tax, instead of the earned surplus.” Although the non-party corporation actually paid the amount to the Plaintiff using the money issued and received from BB

Therefore, as long as the non-party corporation paid the key amount to the Plaintiff as earned surplus within the scope of distributable profits, it shall be deemed that the non-party corporation gains income equivalent to the key amount in accordance with the legal nature of the key amount and the taxation takes place in sequence at the stage of constructive dividend to the Plaintiff. Therefore, it is necessary to mitigate it by tax adjustment. Ultimately, it does not go against the legislative intent of the above statutory provisions to exclude part of it from taxable income by applying Article 18-3(1) of the former Corporate Tax

3. Conclusion

Therefore, the plaintiff's claim shall be accepted for the reasons and it is so decided as per Disposition.

3. Conclusion

Therefore, the lawsuit of this case is unlawful and thus, it is so decided as per Disposition.