It is reasonable to see that a sales contract is not a transfer of business but a supply of goods.

In the case of transfer of business, the evaluation of assets and liabilities and the evaluation of goodwill (customers, confidentiality of business, management organization, etc.) are very important factors.

Article 6 of the former Value-Added Tax Act

2012 disposition of revocation of the imposition of value-added tax

The AA

Head of Jinju Tax Office

July 16, 2013

August 20, 2013

1. On May 2, 2012, the Defendant’s refusal to refund the value-added tax of KRW 1, 2012 imposed on the Plaintiff on the Plaintiff on May 2, 2012 and the imposition of penalty tax of KRW 1, 2012 imposed on the Plaintiff on July 3, 2013 is revoked.

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;

The following facts may be acknowledged by the evidence Nos. 1 and 2-1, 2, 3, 10, 11, 1, 2, 5, 31, 33, 35, 36, 37, 1, and 2, respectively.

A. On January 12, 2012, the Plaintiff entered into a contract to purchase the 6th floor of the ground (hereinafter referred to as the "each real estate in this case in the above real estate) used as a lodging facility in the trade name of "OO-gun No. 535-3 through 7 sites and "CCC" from BB, Inc. (hereinafter referred to as "B,") operating a tourist hotel business, etc., and filed a tax invoice with the Defendant on March 23, 2012 for the purchase of the OOO (including the value-added tax) at the OOO (including the building OOOOO and the site OOO). On March 23, 2012, the Plaintiff reported the amount of the input tax equivalent to the input tax amount in the above building price as the amount of the value-added tax payable for early 1, 2012, but did not pay it to the Defendant on March 25, 2012."

C. On May 2, 2012, the Defendant again revoked the Plaintiff’s instant return on the refund of value-added tax, on the ground that the instant transaction constituted business transfer under Article 6(6) of the Value-Added Tax Act and Article 17(2) of the Enforcement Decree of the same Act, and again rejected the Plaintiff’s return of the refund, and issued an OO of the additional tax on the return of excess refund under Article 47-3(1)2 of the Framework Act on National Taxes, and revoked the imposition of the additional tax on March 28, 2013, and did not impose the additional tax on the excess return of the same amount on April 1, 2013, but did not notify the Plaintiff of the prior notice of taxation on May 28, 2013 (hereinafter “the Tax Tribunal”) and subsequently rejected the Plaintiff’s request for a return of excess amount on July 3, 2013.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

Although the Plaintiff purchased each of the instant real estate as an individual asset and did not comprehensively acquire accommodation business from BB, the instant disposition that the Defendant reported to transfer the sales of each of the instant real estate to a business entity is unlawful.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Article 6(6)2 of the former Value-Added Tax Act (wholly amended by Act No. 11873, Jun. 7, 2013; hereinafter the same) and Article 17(2) of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 24638, Jun. 28, 2013; hereinafter the same) mean that the transfer of a business that is not deemed the supply of goods means the comprehensive transfer of physical, human, rights, and obligations, etc. including business property, to replace only the management body while maintaining the identity of the business. Thus, the business is an organic combination of human and physical facilities that can be separated from the management body and can be socially independent (see, e.g., Supreme Court Decision 2004Du8422, Apr. 28, 2006; 2004Du84278, Jul. 29, 2007). 208.

“2) According to the overall purport of each of the statements and arguments as stated in the evidence Nos. 3, 5, 17, and 18 of this case, it is reasonable to view the sales contract of this case as the supply of goods, not a business transfer, according to the following facts and circumstances: (a) from January 12, 2012, when the Plaintiff purchased each of the instant real estate and registered its business, until April 2012, the Defendant changed the trade name of CCC to the CCC hotel for about two months; and (b) the Defendant operated a lodging business with BB BB’s website as it is; (c) however, the transaction of each of the instant real estate is insufficient to recognize as the transfer of business under Article 6(6)2 of the former Value-Added Tax Act and Article 17(2) of the Enforcement Decree of the same Act.

A) There is no evidence to acknowledge that the Plaintiff entered into the instant sales contract or acquired various types of houses and automobiles used for accommodation business after that contract, or succeeded to personal relations, including employees at the time. Rather, according to the evidence Nos. 5-1, 2, 9, and 7-3 of the evidence Nos. 5-1, 7, the equipment was not owned by BB at the time of the instant sales contract after being awarded a successful bid on Jan. 28, 2004, and the vehicle owned by BB, which was used for accommodation business, was owned by BB even at the time of the Defendant’s investigation into the refund site.

B) In the case of the transfer of business, the appraisal of assets and liabilities and the appraisal of goodwill (including large-scale customer relationship, business secret, management organization, etc.) are very important factors. In the case of the instant sales contract, there is no evidence to deem that there was an appraisal of assets and liabilities related to accommodation business conducted by BB, or a transfer of business secret, management organization, etc. of large-scale customer relationship and business secret, management organization, etc. Rather, according to the record of the evidence No. 3, the Plaintiff and BB entered into a contract with only the building and the land under the special agreement at the time of the instant sales contract. Thus, the Plaintiff and BB entered into a contract with only the building and the land under the special agreement at the time of the instant contract, not included in the contents of the contract, and Party B should settle all public charges and management expenses before the balance and prevent damage to Party B from occurring (No. 2), Party B should cancel the collateral security established on the real estate before the date of the remainder, and Party B’s obligation and obligation are not known to the Plaintiff B.

C) According to the statements in Eul evidence Nos. 13 (Standard Balance Sheet) and Eul evidence Nos. 14 (Standard Income Statement) as of December 31, 201, as of December 31, 201, the assets total amount of KRW 00,000,000, and KRW 00,000,000,000,000,000,000,000,000,000,000,000,0000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,00

4) Therefore, the Plaintiff’s assertion is with merit.

3. Conclusion

Therefore, the plaintiff's claim is reasonable, and it is so decided as per Disposition.