In case where a taxpayer transferred a claim for national tax refund to a third party and lawfully demanded the director of the tax office to transfer it, but the director of the tax office, upon the above demand, did not appropriate the transferor's national taxes in arrears without delay, the validity of appropriating the refund money to the transferor

In full view of the provisions of Articles 51 and 53 of the Framework Act on National Taxes and Article 42 of the former Enforcement Decree of the Framework Act on National Taxes (amended by Presidential Decree No. 17047 of Dec. 29, 200), if a taxpayer requests a transfer in writing after he/she has transferred his/her national tax refund claim to another person, by notifying the head of the tax office of the document stating the address and name of the transferor and transferee, details of the right to transfer, etc., and if the transferor requests a transfer, the head of the tax office shall immediately first appropriate the national tax in arrears, and if there is any national tax in arrears, he/she shall pay the balance to the transferee. If the transferee fails to make such appropriation without delay even if he/she has received a legitimate request for transfer from the transferor due to its violation, the transferee's claim for the refund shall be attributed to the transferee, and even if the tax office has appropriated it to the transferor's national tax in arrears, such appropriation ultimately becomes final and conclusive to the transferee, and thus becomes null and void.

Articles 51 and 53 of the Framework Act on National Taxes, Article 42 of the former Enforcement Decree of the Framework Act on National Taxes (amended by Presidential Decree No. 17047 of Dec. 29, 2000)

[Plaintiff-Appellant-Appellee] Plaintiff 1 and 1 other (Law Firm Han, Attorneys Park Jae-young et al., Counsel for plaintiff-appellant-appellant-appellee)

Plaintiff (Attorney Kim Jae-won, Counsel for the plaintiff-appellant)

Korea

Seoul District Court Decision 2001Na56279 delivered on April 24, 2002

The judgment of the court below is reversed, and the case is remanded to the Seoul District Court Panel Division.

1. Basic facts

Review of the reasoning of the lower judgment and the record reveals the following facts.

A. On January 25, 1998, the Sung Heavy Equipment Co., Ltd. (hereinafter referred to as a "non-party company") reported that 671,712,365 won was deducted from the output tax amount, and 327,985,482 won was paid if the non-party company received an application for bad debt tax credit from the non-party company on April 6, 1998, but the director of the tax office did not accept the application for bad debt tax credit for the non-party company on September 1, 1999 and imposed 410,89,10 won on the non-party company as the value-added tax amount for the second half-year period of September 1, 199.

B. On November 1, 1998, the Plaintiff, as a certified tax accountant, was delegated with a national tax appeal case against the disposition of this case by the non-party company, and agreed to be paid 40 million won by the method of taking over the corresponding refund claims when the decision to revoke the disposition of this case becomes final and conclusive. On August 18, 1999, the National Tax Tribunal accepted the claim of the non-party company on August 18, 1999, and requested the non-party company to notify the head of the tax office of the transfer of the refund claims amounting to 671,712,360 won from the output tax amount to correct the tax base and tax amount.

C. However, the head of the tax office revoked the instant disposition in accordance with the purport of the national tax judgment around September 13, 1999, and the re-revision resolution prepared at the time, omitted the determination of refund for the said refundable tax amount by mistake, even though the non-party company stated that the amount of bad debt tax would incur KRW 327,985,482, the amount of refundable tax returned by the non-party company was deducted from the output tax amount.

D. After that, on May 28, 2001, when the lawsuit in this case was pending, the head of the tax office found the omission of the decision of refund amounting to KRW 327,985,482. At the same time, the head of the tax office revoked the disposition of deficits on the four national taxes written off as of December 22, 1998, and appropriated the above refund (including additional dues) with all the national taxes in arrears of the non-party company.

2. The judgment of the court below

The court below determined that, as alleged in the plaintiff, even if the refund claim in this case does not constitute the seizable property at the time of the disposition of deficits as of December 22, 1998, and it did not meet the requirements for the cancellation of the disposition of deficits, the disposition of cancellation of the disposition of deficits cannot be deemed null and void merely on such ground, and it cannot be denied the validity of the disposition of cancellation in the civil procedure by its fairness unless the disposition of cancellation of the disposition of deficits is revoked through legitimate procedures, and even if the taxpayer did not notify the cancellation of the disposition of the disposition of deficits, the head of the tax office did not affect the validity of the disposition of cancellation. Thus, the disposition of cancellation of the disposition of deficits as of December 22, 1998, which was appropriated for the national taxes of the non-party company as the refund in this case after the head of the tax office revoked the disposition of deficits as of December 22, 198, and as a result, the defendant had already extinguished the refund

3. Judgment of the Supreme Court

However, it is difficult to accept the judgment of the court below for the following reasons.

Article 51 of the Framework Act on National Taxes provides that the head of a tax office shall immediately determine the amount paid in error, amount paid in excess, or amount of tax to be refunded under the tax-related Acts, among national taxes, additional dues, or expenses for disposition on default, when there is any amount of national tax paid by the taxpayer as a national tax, additional dues, or amount of tax to be refunded under the tax-related Acts, and Article 53 provides that the taxpayer may transfer his/her right to the national tax refund to another person as prescribed by Presidential Decree. Article 42 of the former Enforcement Decree of the Framework Act on National Taxes (amended by Presidential Decree No. 17047 of Dec. 29, 200) provides that the taxpayer who intends to transfer his/her right to the national tax refund to another person shall request the head of a tax office to transfer in writing, stating the address and name of the transferor and transferee and the contents of the right to be transferred. In such cases, if there

In light of the provisions of the above Acts and subordinate statutes, if a taxpayer requests a transfer of the national tax refund by notifying the head of the tax office in writing stating the address and name of the transferor and transferee after transferring the national tax refund to another person, and the details of the right to transfer the tax refund, and if the transferor requests a transfer of the national tax in arrears, the head of the tax office shall immediately appropriate the national tax in arrears, etc. and pay the balance to the transferee if there is any national tax in arrears. If the transferee fails to appropriate the refund without delay even if the head of the tax office demands a legitimate transfer from the transferor due to his/her violation, the transferee's claim for the refund that the transferee acquired shall belong to the transferee. Since the head of the tax office becomes effective only in the future because the appropriation has no retroactive effect even if the appropriation was made to the transferor's national tax in arrears, etc. (see Supreme Court Decision 87Meu323, May 23, 1989, etc.). Such appropriation is ultimately reverted to the transferee, and

On August 18, 199, the National Tax Tribunal accepted the claim of the non-party company from the non-party company and decided to correct the amount of bad debt tax after deducting 671,712,360 won from the output tax amount on September 13, 199. Accordingly, the head of the tax office revoked the disposition of this case on September 13, 200, and the non-party company's refund claim against KRW 327,985,482 was confirmed at that time. Since the non-party company transferred the above refund claim amounting to KRW 40 million from the above refund claim to the plaintiff and requested the transfer thereof to the head of the tax office in accordance with legitimate procedure on August 25 of the same year, the head of the tax office had to immediately comply with the request for transfer of the remaining amount, the head of the tax office must appropriate the above refund amount to the non-party company for the remaining amount without delay, and the non-party company's remaining amount after being requested to transfer the tax amount to the plaintiff.

Nevertheless, the court below determined that the chief of the tax office cancelled the disposal of deficit after one year and nine months from the date of the request for the transfer of the non-party company and appropriated the non-party company's delinquent national taxes as the refund in preference to the plaintiff's right to claim the return of the amount of the transfer of the national tax refund in this case. In so doing, the court below erred by misapprehending the legal principles as to the transfer and appropriation of the national

4. Therefore, without examining the remaining grounds of appeal, the judgment of the court below shall be reversed, and the case shall be remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices.

Justices Byun Jae-chul (Presiding Justice)