Seoul Administrative Court 2008Guhap47043 (2010.04.01)

Seocho 208west 1470 (Law No. 9, 26, 2008)

If there are processing sales and processing purchases, the exclusion period for imposition of additional tax against the failure to report the aggregate tax invoice;

The issue of whether there was a evasion, unjust refund, or deduction of national taxes shall be determined on the basis of the main tax amount excluding the additional tax, and on the basis of whether there was a evasion, unjust refund, or deduction of value-added tax only for the portion exceeding the output tax amount for processing where there

The contents of the decision shall be the same as attached.

○ Communications Corporation

The director of the tax office

1. The defendant's appeal is dismissed.

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

1. Purport of claim

The imposition of value-added tax of KRW 175,506,040 against the Plaintiff on February 1, 2008 shall be revoked.

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. Circumstances of the imposition disposition;

(1) The plaintiff is a company that ○○○○-dong 2, ○○-dong 24-1, with its head office located in 24-1, engaged in information system consulting, software development services, and package kiki-dong sales business

② The Plaintiff received purchase tax invoices of KRW 4,377,651,00 (hereinafter “purchase tax invoices of this case”) from △△ Communication Co., Ltd., on Nov. 19, 2001, the 2001 taxable period of the 2nd Value-Added Tax (from July 1, 2001 to December 31, 2007), without any real transaction. On Nov. 17, 2001, the Plaintiff issued the purchase tax invoices of KRW 2,53,681,00 (hereinafter “the purchase tax invoices of this case”). On Nov. 17, 2001, the Plaintiff filed a return on the supply price of KRW 1,863,970,00 (the total supply price of KRW 4,397,651,00, hereinafter “value-Added Tax”) for each sales tax invoice of KRW 2,53,681,000 (the total supply price of this case”).

③ On February 1, 2008, the Defendant imposed penalty tax of KRW 175,506,040 (hereinafter “instant penalty tax”) on the Plaintiff on the grounds that the entry of the list of the total tax invoices by customer and seller in the taxable period of the said value-added tax was differently entered from the fact (hereinafter “instant disposition”).

[Grounds for Recognition] Nos. 1, 2, and 1, 2, and 3 (including virtual numbers), the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The parties' assertion

(i) The plaintiff's assertion

Even if the Plaintiff entered the supply value of the purchase and sale tax invoice of this case on the list of purchaser and sales tax invoices by customer, there is no tax amount actually evaded value-added tax or illegally refunded or deducted, which does not constitute “the case where the Plaintiff evaded, refunded or deducted national taxes by fraudulent or other unlawful means” as prescribed by Article 26-2(1)1 of the former Framework Act on National Taxes (amended by Act No. 8139 of Dec. 30, 2006; hereinafter the same shall apply) and Article 26-2(1)1 of the former Framework Act on National Taxes (amended by Act No. 8139 of Dec. 30, 2006; hereinafter the same shall apply) to the penalty tax of this case, the principle under Article 26-2(1)13 of the former Framework Act

2) Defendant’s assertion

First, due to the characteristics of the penalty tax in this case, the determination of whether the imposition period for ten years applies should be made separately by each tax invoice. Since the act of receiving the purchase tax invoice in itself brings about the "inability or significant difficulty in tax collection due to fraud or other unlawful act", the fact that the processing tax invoice was issued in the last amount does not affect whether the fact that the processing tax invoice was issued has already occurred or not.

Second, since the Plaintiff received the instant purchase tax invoice and issued the instant sales tax invoice to △S et al., instead of using only the instant processing sales tax invoice after issuing the instant sales tax invoice and using it, and △S et al. obtained the purchase deduction by using it, the Plaintiff should be deemed to evade value-added tax or have received an unfair refund or deduction. Therefore, the exclusion period for imposition of the penalty tax of this case is ten years.

(b) Related statutes;

It is as shown in the attached Form.

C. Determination

Even if a taxpayer who has filed a tax base return within the statutory due date of return in accordance with the form, legislative purport, and strict interpretation of Article 26-2(1)1 of the former Framework Act on National Taxes commits a fraudulent or other unlawful act, the exclusion period of imposition shall be five years, in principle, if he/she evades national taxes, or fails to receive refund or deduction. This does not change even if the relevant taxpayer participated in the tax evasion, etc. of another taxpayer, etc., even if he/she did not have

In addition, the issue of whether there was a evasion, unjust refund, or deduction of the pertinent national tax in the form of national tax declaration should be determined on the basis of the principal tax other than the additional tax. In a case where the entrepreneur who supplies goods or services files a return on the tax base of value-added tax or the amount of tax refund based on the processing tax invoice along with the processing tax invoice, the supply price on the processing tax invoice is the non-supply of goods or services subject to value-added tax, and it cannot be deemed that the abstract tax liability was established. Thus, even if the input tax amount subject to deduction is processed, it shall be deemed that there was a evasion, unjust refund, or deduction of value-added tax related to the processing transaction only for the portion exceeding the output tax amount (see Supreme Court Decision 2007Du16974, Dec. 2

The Plaintiff filed a value-added tax return on each of the supply values of the purchase and sale tax invoices of this case on the list of total tax invoices by seller and seller, as seen earlier, since the supply value of the purchase tax invoice of this case does not exceed the supply value of the sales tax invoice of this case, the period for exclusion of imposition of the penalty tax of this case is five years. Accordingly, the Plaintiff’s above assertion is with merit.

On the part of the defendant's argument, the first argument cannot be accepted in light of the above legal principles, and the second argument cannot be accepted since the plaintiff's tax evasion cannot be viewed as the plaintiff's tax evasion, even if △△ et al. received the purchase deduction using the sales tax invoice of this case.

D. Sub-determination

Therefore, the instant disposition is null and void since five years have elapsed since the exclusion period for imposition was imposed from January 26, 2002 (the next day of January 25, 2002, which was the filing deadline for the second period of value-added tax, 2001) where the second period of value-added tax can be imposed on the Plaintiff.

3.In conclusion

Therefore, the plaintiff's claim is justified, and the judgment of the court of first instance is just, and the defendant's appeal is dismissed. It is so decided as per Disposition.