Suwon District Court 2008Guhap7473 (Law No. 22, 2009)

Determination on the assertion that the omission of sale is illegal due to the failure to use the method of estimated investigation;

Determination and correction shall be determined by the on-site investigation of a report and its attached documents or account books kept and recorded or other documentary evidence, and it shall not be determined by the additional investigation because the omitted amount of sales reaches 48.3%.

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

1. The plaintiff's appeal is dismissed.

2. Costs of appeal shall be borne by the Plaintiff.

Purport of claim and appeal

The decision of the first instance shall be revoked. The defendant's each disposition of imposition of KRW 22,231,201, corporate tax for the year 2001, KRW 24,301, corporate tax for the year 202 (hereinafter "the disposition of this case") and KRW 24,301,40, KRW 279,545,740 for the year 2002, KRW 144,09,200 for the year 235,897,101 for the year 204, KRW 242,728,572 for the plaintiff (hereinafter "the disposition of this case") shall be revoked. The disposition of this case and each disposition of this case shall be revoked as well as each disposition of this case.

1. Quotation of the reasons for the judgment of the first instance;

In accordance with Article 8(2) of the Administrative Litigation Act and the main sentence of Article 420 of the Civil Procedure Act, the reasons for the judgment of the court of first instance shall be cited as the reasons for the judgment of this case: Provided, That part of them shall be dismissed as follows 2, and the decision on the matters alleged by the plaintiff in the appellate court shall be added as follows 3.

2.Terpared parts

In the judgment of the first instance,

1. 168,908,643 won (=320,628,627,00 won - 152,937,00 won) - 230,628,725 won (i.e., 427,04,725 won - 152,935,00 won - 43,237,000 won) - 168,908,643 won (i.e. 320,628,275 won - 152,935,000 won - 43,237,000 won)

○ 6. Determination on the Claim for Job Miscellaneous (3) 2. 'No. 10, 33-62 of A', 'No. 10', 'No. 10, 33-62', '2.

○ 7 pages 7(5) below the 13th "Judgment on the assertion of an amount equivalent to the loan," each of the descriptions of evidence Nos. 12, A 14-21, and A 23. 24 is revised to "A" only by the separate descriptions of evidence No. 12. 14- 21, 23. 24. 24. 63-72.

3. Additional Judgment

A. Determination as to the assertion that each of the dispositions of this case was unlawful because it did not use the method of estimated investigation

(1) The plaintiff asserts that since the amount equivalent to 48.3% of the sales of the plaintiff company from 2001 to 2005 was omitted in the account books due to the loss, etc. of account books and documentary evidence, this constitutes a case where there is no necessary account books and documentary evidence in calculating the tax base or income amount, or where there is no significant part or false part thereof, and therefore, the defendant's each disposition of this case is unlawful even though it should be calculated by the method of estimated investigation under the relevant provisions of the Income Tax Act and the Corporate Tax

(2) Article 103(2) of the Enforcement Decree of the Corporate Tax Act provides that the determination or correction under Article 66 of the Act shall be based on the on-site investigation by the return under Article 60 of the Act and the accompanying documents or account books kept on record or other documentary evidence. Article 142(1) of the Enforcement Decree of the Income Tax Act provides that the determination or correction of the tax base and tax amount under Article 80 of the Act shall be based on the standard tax declaration and the accompanying documents or on-site investigation. Therefore, when the amount of income can be determined by the on-site investigation method, the determination or correction of the tax base

(3) Meanwhile, unless there are special circumstances, such as account books or other documentary evidence, in a case where the tax authority finds the revenue omitted from the initial return of the corporation due to the method of a field investigation, it shall be deemed that the corresponding purchase cost was included in the total deductible expenses corresponding to the total revenue, unless there exist special circumstances, such as where the tax authority found the revenue omitted from the initial return of the corporation. In this case, if the tax authority failed to make a report on the expenses corresponding to the omission of revenue and wants to obtain the deduction, it shall prove and prove the omission of the tax amount. In this case, unlike the method of determining the total expenditure, only the deductible expenses corresponding to the omission of revenue shall not be calculated and deducted by the method of a preliminary investigation, not by the on-site investigation (see, e.g., Supreme Court Decisions 2001Du4399, Mar. 11, 2003; 2002Du2673, Nov. 27, 2003).

(4) In the instant case, the head of the ○○ Tax Office, which conducted a tax investigation with respect to ○○○○ Company, was aware of the fact that the Plaintiff Company underreported the sales revenue of ○○ Company, and the Defendant notified by the head of the ○○ Tax Office of the omission of sales of the Plaintiff Company, investigated and determined the omitted sales revenue of the Plaintiff Company, and recognized the fact that the Plaintiff Company omitted sales [each entry in the evidence Nos. 1 and 4-1

(5) Therefore, inasmuch as the Defendant revealed the omission of sales by the Plaintiff’s on-site investigation, and the Plaintiff’s company also recognized it, it cannot be calculated and deducted by means of an on-site investigation, not an on-site investigation, but an on-site investigation. Therefore, the Plaintiff’s assertion

B. Determination as to the assertion that the output tax amount of value-added should be treated as a bankruptcy claim as a bad debt

(1) On November 1, 2008, the Plaintiff asserted that the amount equivalent to the value-added tax which the Plaintiff Company was not paid by △△ Company, upon the decision of the bankruptcy procedure rendered by the Japanese District Court on November 1, 2008, meet the requirements of bad debt under Article 19-2(1) of the Corporate Tax Act and Article 19-2(1)8 of the Enforcement Decree of the same Act, which is the equivalent amount, should be included in deductible expenses and deducted from the bonus disposal amount.

(2) The decision to commence a bankruptcy proceeding in Japan is to be rendered on the date of the pertinent disposition, which is not the △△△△ Party, a corporation that transacted with the Plaintiff Company during the pertinent taxable period. Therefore, the Plaintiff’s assertion, based on the premise that △△△ Party, Inc., was subject to the decision to commence a bankruptcy proceeding, is without merit without any further review.

4. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and the judgment of the court of first instance is just, and it is so decided as per Disposition by the plaintiff's appeal.