Cho High Court Decision 2015Do1286 ( October 24, 2015)

Whether the designation of the secondary tax obligor is legitimate

The Plaintiff is merely a shareholder of 00000 in the form of a corporation, and there was no awareness and intent to exercise rights, so the instant disposition that the Plaintiff designated as a secondary taxpayer by the said corporation is unlawful.

Article 39 (Secondary Liability for Tax Payment of Contributors)

Revocation of Disposition Imposing Corporate Tax

Kim 00

00. Head of tax office

April 1, 2016

April 22, 2016

1. On January 7, 2015, the Defendant: (a) designated the Plaintiff as the secondary taxpayer of 0000, Inc.; and (b) revoked the disposition imposing the Plaintiff the tax amount of KRW 23,610,684, such as corporate tax.

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

The same shall apply to the order of the Gu office.

1. Details of the disposition;

The Defendant, on January 7, 2015, designated the Plaintiff as the secondary taxpayer of 000, holding 100% of the shares of 10000 (hereinafter referred to as 'sub 000'), and imposed KRW 23,610,684 in total, including the corporate tax in arrears and the value-added tax (hereinafter referred to as 'the instant disposition') on the Plaintiff (hereinafter referred to as 'the instant disposition’).

2. Whether the instant disposition is lawful

(a) Facts of recognition;

1) Reasons for the establishment of the branch,00

I suggested that 00,000 won should be guaranteed as salary for one month by employing 00,000 won as an employee in charge of business, if the representative of a corporation newly established in the name of the plaintiff's spouse, 00.

The Plaintiff gave 00 documents necessary for the establishment of a corporation to Y0 through 00, and on November 8, 2012, 100 established a branch of 000 by using them (the Plaintiff registered the Plaintiff as an internal director, 100 as an auditor) and paid the capital (the 00th fiscal year deposited funds in the Plaintiff’s name in the corporate passbook).

2) Whether the Plaintiff’s 000 shareholders’ rights were exercised

The Plaintiff did not apply to the Plaintiff’s e-mail to report the details of the corporate passbook or the business account, etc., and the Plaintiff does not have to attend the meeting of 000 or receive any business report related to the company. Moreover, the Plaintiff does not receive any notice on the holding of the general meeting of shareholders or any other business affairs or did not attend the general meeting of shareholders, nor did it receive any dividend as a shareholder.

3) Relationship 00 between oil and oil

In September 2012, U.S. borrowed money from No. 1000 without the intention or ability to repay the debt, and the U.S. demanded that the tax invoice be issued in 2000 as if the actual transaction had been made between 000 (the enterprise operated by 00) and 000. The U.S. issued tax invoice in 000 in the name of 000 without actual transaction.

On the other hand, the name of 100 is written as the representative of 000.

[Ground of recognition] Facts without dispute, entry of Gap evidence Nos. 1 through 9, purport of the whole pleadings

B. Determination

According to the above facts, in order for the Plaintiff’s spouse to work as an employee in charge of the business of 000, the Plaintiff consented to the Plaintiff’s name in the name of the Plaintiff. However, the Plaintiff did not pay shares for 000 shares; the Plaintiff did not exercise voting rights, such as voting rights, or participate in the management; and there was no notification of holding a general meeting of shareholders or other company affairs or receiving dividends as a shareholder. In full view of the relationship between the Plaintiff’s spouse and 100 shares, it is difficult to view that the Plaintiff was in a position to substantially control the operation of 00 shares, or in a position to exercise shareholder rights for shares owned by the Plaintiff.

Therefore, the instant disposition taken on the premise that the Plaintiff falls under the secondary taxpayer as an oligopolistic shareholder of the branch000 is unlawful. 3. Conclusion

Thus, the plaintiff's claim of this case shall be accepted on the grounds of its reasoning.