[1] Whether “an act of receiving a false tax invoice by a person who is liable to receive a tax invoice under the provisions of the Value-Added Tax Act, such as a refund of the supply price through a conspiracy with the supplier” constitutes a violation of Article 11-2(2) of the former Punishment of Tax Evaders Act (affirmative)

[2] The meaning of "a person who performs the act of issuing a tax invoice without supplying goods or services under the Value-Added Tax Act" under Article 11-2 (4) 1 of the former Punishment of Tax Evaders Act, and the requirements to establish a real transaction such as entering into a contract to supply goods or services

[3] In a case where the defendant, the representative director of Gap corporation, entered into an all-inclusive share swap contract with Eul corporation representative director Eul corporation, and provided the accounting data which was falsely counted in the sales of Eul corporation to the evaluation institution by providing them with an excessive evaluation of the share value of Eul corporation's company's stock price, and then came to office as the representative director of Eul corporation, thereby causing losses to Eul corporation by conducting share swap pursuant to the above contract, the case holding that the judgment below which found the defendant not guilty on the ground that the defendant, who was in the position of managing Eul corporation's business, performed a all-inclusive share swap contract with Eul corporation, was in violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation), was guilty

[1] Where a tax invoice under the former Punishment of Tax Evaders Act (amended by Act No. 7321 of Dec. 31, 2004 or by Act No. 9919 of Jan. 1, 2010; hereinafter “former Punishment of Tax Evaders Act”) is received by a person who is liable to receive a tax invoice under the Value-Added Tax Act and a person who is liable to submit a list of total tax invoices for the supply of goods or services, and a person who is liable to submit a list of total tax invoices for the supply of goods or services, receives a false tax invoice by way of a conspiracy with suppliers, such act constitutes a violation of Article 11-2(2) of the former Punishment of Tax Evaders

[2] Article 11-2(4)1 of the former Punishment of Tax Evaders Act (wholly amended by Act No. 919, Jan. 1, 2010) provides that “a person who issues a tax invoice under the Value-Added Tax Act without the supply of goods or services under the Value-Added Tax Act” shall be deemed to mean a person who issues a processed tax invoice without a real transaction (so-called data). It shall not be deemed that a person who issues a tax invoice in violation of the related Acts and subordinate statutes, such as entering into a contract for the supply of goods or services, and thus, intends to punish a person who receives a tax invoice to receive a value-added tax without the supply of actual goods or services. Here, the fact that a real transaction, such as entering into a contract for the supply of goods or services, refers to a binding agreement between the parties to provide goods or services, and thus, Article 11-2(4)1 of the former Punishment of Tax Evaders Act provides for a unit price for supply of goods or services as one of the supply prices prior to the issuance price of goods or services.

[3] In a case where the Defendant, the representative director of the Company A, entered into an all-inclusive share swap contract with the representative director of the Company B as a method of bypassing the company Gap, and set the rate of share swap favorable by providing the accounting data which was falsely counted as the sales value of the Company A to the accounting corporation, which is an evaluation institution, and then took office as the representative director of the Company B, thereby causing losses to the Company B by conducting share swap pursuant to the above contract, the case holding that the lower court erred by misapprehending the legal principles as to the company's occupational interest and by failing to take all-inclusive measures as a manager of the board of directors for the reason that the Defendant was in the position of representative director of the Company B at the time of carrying out the all-inclusive share swap contract, and performing a comprehensive share swap contract with the circumstance that the value per share was increased by false sales data, etc., and thereby failing to inform the Defendant of the above all-inclusive share swap contract and thereby failing to take all-inclusive measures as a manager of the board of directors' meeting of directors for the reason that the Defendant was aware of the above comprehensive share swap contract and thereby causing losses.

[1] Article 11-2(2) of the former Punishment of Tax Evaders Act (amended by Act No. 7321, Dec. 31, 2004; see current Article 10(2)); Article 11-2(2) of the former Punishment of Tax Evaders Act (amended by Act No. 9919, Jan. 1, 2010; see current Article 10(2)) / [2] Article 11-2(4)1 of the former Punishment of Tax Evaders Act (amended by Act No. 9919, Jan. 1, 2010; see current Article 10(3)1 of the former Punishment of Tax Evaders Act; Article 16(1)3 and 5 of the former Value-Added Tax Act (Amended by Act No. 8142, Dec. 30, 2006; see current Article 10(3)3 and 5 of the former Enforcement Decree of the Value-Added Tax Act (Amended by Presidential Decree No. 251365, Mar. 1, 20198, 207, 207)

[2] Supreme Court Decision 2004Do655 Decided June 25, 2004 (Gong2004Ha, 1280)

Defendant 1 and one other

Defendants and Prosecutor

Attorney Na-ju et al.

Seoul High Court Decision 2009No2284 decided August 20, 2010

Of the judgment of the court below, the guilty portion against the Defendants, the violation of the Punishment of Tax Evaders Act by receiving false tax invoices against the Defendants, the violation of the Punishment of Tax Evaders Act by issuing false tax invoices on December 31, 2005, and the guilty portion against Defendant 1 on the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation) and the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Fraud) against Defendant 1 are reversed, and the case is remanded to the Seoul High

The grounds of appeal are examined.

1. As to the Prosecutor’s Grounds of Appeal

A. Meritorious of legal principles as to the principle of non-defluence in relation to the violation of the Punishment of Tax Evaders Act by receiving false tax invoices

(1) The reasons why the applicable provisions of the indictment are written in the indictment are clearly evaluated in order to guarantee the defendant's right to defend by clarifying the legal evaluation of the facts charged. Thus, even if there is any error or omission in the entry of applicable provisions of the indictment, it does not affect the validity of the indictment unless it gives a substantial disadvantage to the defendant's defense, and the court may also apply the legal provisions that are not immediately recorded in the indictment without going through the procedures for modification of the indictment (see Supreme Court Decisions 2000Do6113, Feb. 23, 2001; 2005Do4085, Apr. 28, 2006, etc.).

Meanwhile, when the former Punishment of Tax Evaders Act (amended by Act No. 7321, Dec. 31, 2004; hereinafter “former Punishment of Tax Evaders Act”) or the amended Punishment of Tax Evaders Act (wholly amended by Act No. 9919, Jan. 1, 2010; hereinafter “Revised Punishment of Tax Evaders Act”) is issued with a tax invoice stating false matters, such as the receipt of the tax invoice under the Value-Added Tax Act and the refund of the supply price by a person liable to submit the list of total tax invoices for the supply of goods or services, upon receipt of the goods or services by a person liable to submit the list of total tax invoices for the supply of goods or services, by a conspiracy with the supplier, such act constitutes a violation of Article 11-2(2) of the former Punishment of Tax Evaders Act or Article 11-2(2)

(2) The court below found that the first instance court found the Defendants guilty by applying the “Article 11-2(4)1 of the Punishment of Tax Evaders Act” as it is in the column for the applicable provisions of the indictment, on the grounds that Defendant 1, the representative director of the non-indicted 2 corporation, and Defendant 2, who was in charge of accounting affairs, did not issue a processing tax invoice without real transactions and received it from the non-indicted 1 corporation, but did not receive the processing tax invoice without real transactions, and received a false tax invoice by stating the value of the supply while real transactions. Accordingly, the court below held that it cannot be punished by applying Article 11-2(4) of the former Punishment of Tax Evaders Act or Article 11-2(4)1 of the amended Punishment of Tax Evaders Act, which punishs the act of issuing or receiving a tax invoice without supplying goods or services under the Value-Added Tax Act.

Furthermore, the court below held that the judgment of the court of first instance convicting the defendant of this part of the charges on the following grounds: (a) it is not that "the defendant conspireds with the non-indicted 3 that should prepare and deliver the tax invoice under the Value-Added Tax Act, and received the false tax invoice from the non-indicted 1 in collusion with the non-indicted 3," and thus, it is not likely that Article 11-2 (1) of the former Punishment of Tax Evaders Act or Article 11-2 (1) 1 of the amended Punishment of Tax Evaders Act which punishs the case where the person who should prepare and deliver the tax invoice under the Value-Added Tax Act is subject to punishment only where the person issues the false tax invoice, because there is no room for application of Article 11-2 (1) of the former Punishment of Tax Evaders Act or Article 11-2 (1) 1 of the amended Punishment of Tax Evaders Act, and this part of the charges constitute "when it is not a crime" and thus, should be acquitted under the former part of Article 325 of the Criminal Procedure Act.

(3) However, in light of the above legal principles, it is difficult to accept such judgment of the court below.

Although the prosecutor instituted a public prosecution against this part of the facts charged by stating the "Article 11-2 (4) 1 of the Punishment of Tax Evaders Act" as applicable provisions of the Act, this part of the facts charged is that a tax invoice stating the value of the supply in real transactions is issued in a false manner, and it is clear that it constitutes a violation of Article 11-2 (2) of the former Punishment of Tax Evaders Act or Article 11-2 (2) of the amended Punishment of Tax Evaders Act.

In addition, among the facts charged in this part, the provisions of Article 11-2 (2) of the former Punishment of Tax Evaders Act applies to each crime listed in the [Attachment Table (1) Nos. 1 through 90] of the judgment of the court below, and in comparison with that of Article 11-2 (4) of the same Act, the upper limit of a fine which is a selective type is smaller than that of Article 11-2 (2) of the same Act, while imprisonment is more than three years, the upper limit of Article 11-2 (2) of the same Act, which is more than two years, which is the upper limit of Article 11-4 (4) of the same Act, is higher than that of Article 11-2 (2) of the same Act, the application of the above Acts and subordinate statutes to Article 11-2 (2) of the same Act cannot be said to give substantial disadvantages to the defense of the defendants (see Supreme Court Decision 2005Do9743, Apr. 14,

In addition, among the facts charged in this part of the judgment below [1] Nos. 91 through 129 of the crime, Article 11-2 (2) of the amended Punishment of Tax Evaders Act applies to each of the crimes listed in No. 91 or 129 of the judgment below. In comparison with the statutory penalty under Article 11-2 (4) 1 of the amended Punishment of Tax Evaders Act, the upper limit of fines in multiple-choice type is less and less, and the upper limit of imprisonment is the same as that under Article 11-2 (2) of the same Act. Thus, the application of the statutes under Article 11-2 (2) of the same Act cannot be said to give substantial disadvantages

Thus, although it is inappropriate for the first instance court to apply "Article 11-2 (4) 1 of the Punishment of Tax Evaders Act" to the facts charged in this part in accordance with the indictment, even if it is found guilty by applying Article 11-2 (2) of the former Punishment of Tax Evaders Act or Article 11-2 (2) of the amended Punishment of Tax Evaders Act, it does not put the Defendants at substantial disadvantage to their defense.

(4) Therefore, in the case of this case where the Defendants and their defense counsel both acknowledged this part of the facts charged at the first instance trial and did not serve as the grounds for appeal against the application of the law of this part of the first instance, the court below revoked the first instance judgment ex officio on the ground that this part of the facts charged cannot be applied to other provisions of the former Punishment of Tax Evaders Act and the amended Punishment of Tax Evaders Act, which are appropriate for this part of the facts charged, on the ground that this part of the facts charged cannot be applied to other provisions of the former Punishment of Tax Evaders Act and the amended Punishment of Tax Evaders Act. The court below revoked ex officio the judgment on the ground that this part of the facts charged is not a crime. The court below erred by misapprehending the legal principles as to the application of Article 11-2(2) of the former Punishment of Tax Evaders Act and Article 11-2(2) of the amended Punishment of Tax Evaders Act and Article 11-2(2) of the former Punishment of Tax

B. Meritorious of legal principles as to the criminal intent of the violation of the Punishment of Tax Evaders Act due to the issuance of false tax invoices on December 31, 2005

(1) Article 11-2 (4) 1 of the Punishment of Tax Evaders Act provides that "a person who issues a tax invoice under the Value-Added Tax Act without the supply of goods or services under the Value-Added Tax Act" shall be deemed to mean a person who issues a processed tax invoice without a real transaction (such as entering into a contract for the supply of goods or services, etc.). It shall not be deemed that the provision that punishs a person to whom a tax invoice is issued as a result of the issuance of a tax invoice in violation of the related Acts and subordinate statutes, such as the Value-Added Tax Act on the time of the issuance of the tax invoice and allow the person to receive the tax invoice to receive the value-added tax without a real supply of goods or services (see Supreme Court Decision 2004Do655, Jun. 25, 2004). The fact that a real transaction, such as entering into a contract for the supply of goods or services, means an agreement between the parties to provide the goods or services with a unit price under Article 11-2(4)1)2 of the former Value-Added Tax Act (amended by Presidential Decree No.

Meanwhile, in a case where the Defendant denies the criminal intent against the act of issuing a tax invoice processed without a real transaction, it is inevitable to prove by means of proving indirect facts having considerable relevance with the intention due to the nature of the object, and what constitutes an indirect facts having considerable relevance with the intention should be determined by means of a reasonable method of determining the connection of the fact based on the close observation or analysis power based on normal empirical rule (see, e.g., Supreme Court Decisions 88Do1523, Nov. 22, 198; 201Do12041, Dec. 22, 2011).

(2) According to the reasoning of the lower judgment, the lower court: (a) deemed that it was difficult for the Defendants to enter into an order for sales of Nonindicted Co. 4 in the instant facts charged; (b) as to the fact that the Defendants violated the Punishment of Tax Evaders Act by issuing false tax invoices on December 31, 2005; (c) prepared a tax invoice stating that Nonindicted Co. 2 would have supplied the goods to Nonindicted Co. 4; (d) for the purpose of supplying the goods to Nonindicted Co. 4; and (e) for the purpose of supplying the goods to Nonindicted Co. 5, the Defendants did not appear to have agreed to sell the goods to Nonindicted Co. 4, 206, including sales of the goods for which Nonindicted Co. 5’s sales order was issued by Nonindicted Co. 2; and (e) for the purpose of supplying the goods to Nonindicted Co. 4, 200, the Defendants did not appear to have any further agreed to sell the goods to Nonindicted Co. 5’s members; and (iii) there was no need for the Defendants to present sales order for the said goods to be sold within five years.

(3) However, in light of the above legal principles, we cannot accept the above judgment of the court below.

First of all, according to the circumstances stated by the court below, the non-indicted 2 corporation issued a tax invoice on December 31, 2005 to the non-indicted 4 corporation in the middle of January 2006, and the non-indicted 4 corporation did not have ordered an amount equivalent to KRW 2,647,279,90 on the supplied goods stated in the tax invoice, and there was no binding agreement between the non-indicted 2 corporation and the non-indicted 4 to trade the above supplied goods, and there was no actual supply of the above goods at that time, and therefore, the non-indicted 2 corporation merely did not have a approximately KRW 3 billion on the ground that it retains approximately KRW 2,647,279,900,000 received from the non-indicted 4 corporation in the last half of 2005, and delivery of the tax invoice to the non-indicted 4 corporation without any actual transaction, which constitutes a violation of Article 11-2 (4) 1 of the Punishment of Tax Evaders Act.

Furthermore, according to the reasoning of the judgment of the court of first instance and the evidence duly adopted by the court of first instance, ① a normal transaction method prior to the issuance of the tax invoice on December 31, 2005 to Nonindicted Co. 4’s Seoul Office, upon delivery of the order from Nonindicted Co. 2 to Nonindicted Co. 2, Ltd., 2005, the inventory of Nonindicted Co. 2, 300, and Nonindicted Co. 4’s coal distribution center, examined the order sheet, sampling, tax invoice, and transaction list with the goods, and one copy of the tax invoice was sent to the supplier, and the other one was in the process of delivering the tax invoice to Nonindicted Co. 3, 400,000,000,000 won, which was issued to Nonindicted Co. 2, 200,000,000 won (hereinafter “Nonindicted Co. 4, 200,000,000 won).

In light of the aforementioned circumstances, inasmuch as the issuance of the tax invoice on December 31, 2005 before the issuance of the tax invoice and the method of issuing the tax invoice on December 31, 2005 was based on the circumstance and purpose of issuing the tax invoice as of December 31, 2005, and inasmuch as the issuance of the tax invoice on December 31, 2005 was based on the premise that it would be carried out in the future within the amount exceeding three billion won which was paid in excess of the non-indicted 4 corporation, it would be sufficient to view that the Defendants issued the tax invoice on December 31, 2005 to support the fact that the issuance of the tax invoice as of December 31, 2005 would not have been carried out again in the subsequent transaction with the non-indicted 4 corporation, and that the issuance of the tax invoice to the Defendants would have been carried out in the name of the non-indicted 2 corporation at the time of issuance of the false tax invoice.

(4) Nevertheless, the lower court, based on its stated reasoning, deemed that it is difficult to view that the Defendants had a criminal intent to commit a violation of Article 11-2(4)1 of the amended Punishment of Tax Evaders Act at the time of issuing the tax invoice as of December 31, 2005, and found the Defendants not guilty of this part of the facts charged. In so doing, the lower court erred by misapprehending the legal doctrine on the interpretation and application of Article 11-2(4)1 of the amended Punishment of Tax Evaders Act, and by misapprehending the facts beyond the bounds of the principle of free evaluation of evidence against logical and empirical rules, thereby adversely affecting the conclusion

C. As to the misapprehension of legal principles on occupational breach of trust

(1) The crime of breach of trust is established when a person administering another’s business obtains pecuniary advantage or has a third party obtain it by doing so through an act in violation of one’s duty and thereby inflict loss on the principal. Here, “act in violation of one’s duty” includes any act in violation of a fiduciary relationship with the principal by failing to perform an act that is naturally expected under the provisions of law, the content of the contract, or the good faith principle, or by performing an act that is expected not to perform as a matter of course, in light of specific circumstances, such as the content and nature of the business (see, e.g., Supreme Court Decisions 9Do4923, Mar. 14, 200; 2009Do1149, Oct. 28, 2010).

(2) On July 13, 2006, when Defendant 1 was appointed as the representative director of Nonindicted Co. 7 and was in the position of managing the business of Nonindicted Co. 7, the lower court determined that, in the above comprehensive share swap contract, there was a resolution on the approval agenda for the comprehensive share swap contract concluded on May 30 of the same year between Defendant 1 and Nonindicted Co. 7’s representative director at the temporary general meeting of shareholders of Nonindicted Co. 7, and that, in the above comprehensive share swap contract, it was decided to exchange the shares of Nonindicted Co. 2 and the shares of Nonindicted Co. 7 at the rate of 1:41.26, because it was decided that Defendant 1 had already been in advance at the above comprehensive share swap contract to exchange the shares of Nonindicted Co. 7 at the rate of 1:41.26, the above comprehensive share swap contract does not necessarily become null and void as a matter of course, and thus, it cannot be viewed that the above comprehensive share swap contract cannot be viewed as an act of share swap and the above share swap rate of Defendant 1.

(3) However, in light of the following facts acknowledged by the aforementioned legal principles and the evidence adopted by the first instance court that did not dismiss the lower court, the lower court’s determination is difficult to accept.

① The sales revenue of Nonindicted Co. 2 was KRW 18.3 billion for the year 2002, KRW 2.7 billion for the net income, KRW 1.7 billion for the net income, KRW 1.7 billion for the year 2003, KRW 1.3 billion for the operating income, KRW 1.4 billion for the net income, and KRW 400 million for the net income. From May 2004, the sales revenue of Nonindicted Co. 2 Co. 9 from around 2004 to around KRW 3.6 billion for the non-indicted Co. 9 among the sales revenue of the year 2004, KRW 3.6 billion for the non-indicted Co. 9 among the sales revenue of the year 204, KRW 1.49 billion for the net income, and KRW 9.6 billion for the net income.

② However, as the multi-level marketing problem of Nonindicted Co. 9 occurred and was controlled on July 2005, the transaction was suspended on or around July 2005. Accordingly, Nonindicted Co. 2, from around August 2005 to around another multi-level marketing company, continued to hold a joint discussion between Nonindicted Co. 4 and Nonindicted Co. 4, a multi-level marketing company, and continued to sell goods through Nonindicted Co. 4, a approximately KRW 13 billion, but the sales amount in 2005 exceeded KRW 32.9 billion compared to the year 2004, the sales amount in 2005 exceeded KRW 5.5 billion, and also decreased operating income and net income. In addition, as Nonindicted Co. 4 aggravated its financial status on or around December 2005, sales amount of Nonindicted Co. 4 through Nonindicted Co. 2, a sudden reduction of KRW 3,382,382,86,206.

③ From August 2005, Defendant 1 sought a scheme for bypassing Nonindicted Co. 2 from around December 2005, sought a bypassing listing of Nonindicted Co. 2. From around December 2005, Defendant 1 sought a bypassing listing of the first half of 2006, which is rhyth of December. As such, there is concern that if the sales are reduced, it would have an unexpected impact on the company’s assessment. As such, as of January 31, 2006, the supply price of KRW 2,647,279,90 for December 31, 2005 to Nonindicted Co. 4 Co., Ltd., Ltd., which is a business partner, was supplied with KRW 2,647,279,900, KRW 35.6 billion, KRW 2005, KRW 309,309,9000, KRW 208,309,309,19,294,2006.

④ The assessment service for the bypass listing of Nonindicted Co. 2 was in charge of Nonindicted Co. 10’s accounting corporation. From January 2006 to May 2006, Defendant 1 provided the above assessment service at the time of Nonindicted Co. 10’s accounting corporation’s accounting report in 2005 and the quarterly accounting report in 2006.

⑤ The assessment of the above stock value is based on estimated financial statements on the industry, business information, and future provided by Nonindicted Co. 2. At the time, Nonindicted Co. 10, at the time, estimated sales in the year 2006 and 2007, taking into account the sales increase rate based on the sales performance in the year 2005 and the quarter 1/4, the growth rate of the industry, the development plan for new products, etc.

④ From January 2006 to May 2006, Nonindicted 10 accounting firm received related data from the side of Nonindicted 2 Company and conducted the above evaluation work. The final result of the business performance in January 4, 2006, which had been falsely counted as above, changed the previous estimated value based on the brus. As a result, Nonindicted 2’s asset value per share of Nonindicted 2 Company was assessed as KRW 22,875, which was reduced from KRW 23,045 to KRW 170, which was reduced from KRW 22,875, which was increased from KRW 126,785 to KRW 5,813, which was then assessed as KRW 132,598, which was then increased from KRW 85,289, KRW 3208, KRW 2088, KRW 2008, KRW 2008, KRW 27086, KRW 2008.

④ At the time of the above stock value assessment, Nonindicted 10 accounting corporation was unaware of the fact that a considerable portion of the sales revenue of Nonindicted 2 Co. 2 in the year 2005 and the year 1/4, 2006 was falsely appropriated, and was aware of the fact that sales revenue of Nonindicted 9 Co. 2, an affiliate, was rapidly reduced from the second half of the year 2005. However, the circumstance that the status of the financial position of Nonindicted 4 Co. 2, which accounts for a large portion of the sales revenue of the second half of the year 2005 and the first half of the year 2006, has deteriorated, making it difficult to know that the financial position of Nonindicted 4 Co. 2, a considerable hindrance to the sales revenue of Nonindicted Co. 4, a company, was not provided by Nonindicted Co. 2.

④ On May 30, 206, Defendant 1, a representative director of Nonindicted Co. 7 and Nonindicted Co. 2, 2006, determined the share swap value of Nonindicted Co. 2, a non-indicted Co. 2, a non-indicted Co., Ltd., as KRW 88,709, and the share swap value of Nonindicted Co. 7, a KOSDAQ-listed corporation as KRW 2,150, calculated according to the method of pricing under Article 36-12 of the Enforcement Rule of the Securities and Exchange Act, respectively, as KRW 1:41.26, and the share swap ratio of Nonindicted Co. 2, a non-indicted Co. 2, a non-indicted Co. 7 acquired shares of KRW 1,00,000 (10%), and Nonindicted Co. 7 acquired shares of KRW 50,260,000 at par value, and delivered them to the shareholders of Nonindicted Co. 2, 205, which constitutes an all-inclusive share swap contract of the above non-indicted Co. 2545.

① On July 13, 2006, Nonindicted Co. 7 approved the above comprehensive share swap contract and appointed Defendant 1 as a director. Defendant 1 was appointed as the representative director at the board of directors of Nonindicted Co. 7, which was held on the same day. Defendant 1, as the representative director of Nonindicted Co. 7, performed the above comprehensive share swap contract on August 17, 2006, and delivered Nonindicted Co. 2’s shares to the shareholders of Nonindicted Co. 7 on August 31, 2006.

④ After settling the actual sales of Nonindicted Co. 2 in 2006, it was found that the amount of approximately KRW 25 billion, which was estimated by Nonindicted Co. 10 accounting firm in 2006, was about KRW 38.7 billion in sales in 2006, which was merely KRW 9.4 billion.

(4) At the time of evaluating the stock value of Nonindicted Co. 2 in the accounting firm of Nonindicted Co. 10, the sales amount of Nonindicted Co. 2 was approximately KRW 18.3 billion in 2002, approximately KRW 10 billion in 2003, and KRW 38.4 billion in accordance with the introduction of the multi-level marketing method of Nonindicted Co. 9, an affiliate, for the year 2004, began to reduce once again from 2005 to 1.4 quarter of 2006, and on this background, it was difficult to predict the sales amount of Nonindicted Co. 2 in the first quarter of 2005 and the sales amount of Nonindicted Co. 3 in the second quarter of 2005, which was a large share of the sales amount of Nonindicted Co. 2’s stock in the second half of 2005 and the sales amount of Nonindicted Co. 4 in the second quarter of 2005, which would have been significantly higher than that of Nonindicted Co. 206.

Nevertheless, Defendant 1 concealed the trend of the decline in the sales of Nonindicted Co. 2 by providing false sales data to Nonindicted Co. 10 accounting firms by providing them as stock value assessment data, and did not properly notify Nonindicted Co. 10 accounting firms of the aggravation of the financial status of Nonindicted Co. 4, which was taking a significant part in the second half of 2005, and caused Nonindicted Co. 10 accounting firms to increase the sales amount in 2006 and 2007 by up to 10% compared to each of the previous years. Based on this, Defendant 1 was presumed to have assessed the value per share of Nonindicted Co. 2, and determined the share swap ratio of the comprehensive share swap contract. Such act by Defendant 1 was an act of deceiving Nonindicted Co. 7, the other party to the comprehensive share swap contract, and could have taken measures to cancel the comprehensive share swap contract on the ground of deception if Nonindicted Co. 7 was aware of

At the time of performing the comprehensive share swap contract, Defendant 1 was in the position of the representative director of Nonindicted Co. 7, and was obligated to faithfully perform his duties as a good manager for Nonindicted Co. 7, in good faith, to make best profits to Nonindicted Co. 7. The fact that the value per share of Nonindicted Co. 2 has increased by false sales data, etc., and when executing a comprehensive share swap contract as it is, Nonindicted Co. 7 was aware of the fact that Nonindicted Co. 7 acquired shares of less than 1,00,000 won per share of Nonindicted Co. 2, which is less than 88,709 won, and in return, issued shares of 41,260,000 won of new shares of Nonindicted Co. 7 to the shareholders of Nonindicted Co. 2, thereby causing considerable property damage.

Therefore, even when the interests of Nonindicted Co. 2 and Nonindicted Co. 7 conflict with each other with respect to the performance of a comprehensive share swap contract, Defendant 1, who was in the position of managing the affairs of Nonindicted Co. 7, shall be deemed to have been occupational duties of faithfully performing his duties as a good manager, such as convening a board of directors or a general meeting of shareholders of Nonindicted Co. 7, and cancelling a comprehensive share swap contract on the grounds of deception, by notifying the aforementioned circumstances and notifying them of the aforementioned circumstances, so as to prevent property damage that Nonindicted Co. 7 would sustain and make best profit to Nonindicted Co. 7. It is sufficient to view that Defendant 1 did not take such measures and rather performed the contract in order to realize the unfair profit for the shareholders of Nonindicted Co. 2 or Co. 7, who was planned under a comprehensive share swap contract, as a representative director of Nonindicted Co. 7,

(5) Nevertheless, the lower court acquitted Defendant 1 of this part of the facts charged on the ground that it is difficult to expect that Defendant 1 would take the above measures, or that the act of share swap under a comprehensive share swap contract cannot be deemed as a violation of duties

The judgment of the court below is erroneous in the misapprehension of legal principles as to the establishment of a crime of occupational breach of trust and the cancellation of contract on the ground of deception, and failing to exhaust all necessary deliberations, which affected the conclusion of the judgment. The ground of

D. Violation of the rules of evidence on the violation of the Securities and Exchange Act due to the holding of shares in Nonindicted 11

As to the facts charged in the instant case, the lower court determined that Nonindicted 11’s statement, consistent with this part of the facts charged, constitutes a case where there is no evidence to prove a crime, and thus, acquitted Defendant 1 on the ground that it constitutes a case where there is no evidence to prove a crime.

Examining the reasoning of the lower judgment in light of relevant evidence, the lower court did not err in violation of logical and empirical rules and the principle of free evaluation of evidence, as otherwise alleged in the ground of appeal.

2. As to the Defendants’ grounds of appeal

A. Violation of the Punishment of Tax Evaders Act by issuing false tax invoices

The lower court convicted the Defendants of violating the Punishment of Tax Evaders Act by issuing false tax invoices on January 31, 2006, false tax invoices on February 28, 2006, false tax invoices on March 31, 2006, and false tax invoices on March 31, 2006, for the reasons indicated in its reasoning.

Examining the reasoning of the lower judgment in light of the evidence duly admitted by the first instance court, the lower court did not err in its judgment by misapprehending the legal doctrine regarding Article 11-2(4)1 of the Punishment of Tax Evaders Act, or by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, contrary to what is alleged in the grounds of appeal.

B. Meritorious of legal principles about violation of the Act on External Audit of Stock Companies

The lower court convicted the Defendants of violation of the Act on External Audit of Stock Companies through false preparation and disclosure of financial statements for the business year 2005 and false preparation and disclosure of financial statements for the business year 2006, on the grounds stated in its reasoning.

Examining the reasoning of the lower judgment in light of the evidence duly admitted by the first instance court, the lower court did not err in its judgment by exceeding the bounds of the principle of free evaluation of evidence against the logical and empirical rules, contrary to what is alleged in the grounds of appeal.

C. Violation of the rules of evidence concerning the violation of the Securities and Exchange Act due to the stockholding of Nonindicted 12, etc.

Examining the reasoning of the lower judgment in light of the evidence duly admitted by the first instance court, the lower court found Defendant 1 guilty on the grounds of its stated reasoning as to “the fact of violation of the Securities and Exchange Act due to Nonindicted 12, 13’s duty to report the change of shares and violation of the duty to report shares held in bulk, among the facts charged in the instant case,” and there is no violation of the bounds of the principle of free evaluation of evidence against logical and empirical rules

3. Scope of reversal

For the above reasons, the part of the judgment of the court below on the charge of the violation of the Punishment of Tax Evaders Act by receiving false tax invoices against the Defendants, and the part on the charge of the violation of the Punishment of Tax Evaders Act by issuing false tax invoices on December 31, 2005, and the part on the charge of the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation) against Defendant 1 should be reversed. Of the judgment below, the part on the guilty against the Defendants should be reversed because it is in a concurrent relationship with the above reversed part and

In addition, the part on Defendant 1's violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Fraud) is about the conjunctive charges, and as long as the part on violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation) is reversed as above, it should be reversed together without examining the grounds of appeal.

Ultimately, the part of the judgment below, excluding the non-indicted 7 corporation's stock ownership status and the violation of the duty to report changes in the number of stocks, and the non-guilty part on the violation of the Securities and Exchange Act prohibiting the use of undisclosed information against Defendant 1, should be reversed.

4. Conclusion

Therefore, among the judgment of the court below, the guilty part against the Defendants, the violation of the Punishment of Tax Evaders Act by receiving false tax invoices against the Defendants, and the violation of the Punishment of Tax Evaders Act by issuing false tax invoices on December 31, 2005, and the guilty part against Defendant 1 concerning the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation) and the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Fraud) against Defendant 1, are reversed, and the case is remanded to the court below for further proceedings consistent with this part, and the prosecutor's appeal against the remaining parts is dismissed. It

Justices Shin Young-chul (Presiding Justice)