[1] The criteria for determining whether an act of wrongful calculation under Article 20 of the former Corporate Tax Act constitutes a wrongful calculation, and the meaning of receiving an unfair lower price under Article 13 (1) 3 of the former Value-Added Tax Act, and the criteria for determining whether it is unfair or considerably low

[2] The case holding that the act of applying a 10% discount rate to the related parties while providing oil supply to the related parties does not constitute an unfair act that disregards economic rationality, and it does not constitute an unfair act that unfairly lower price under Article 13 (1) 3 of the former Value-Added Tax Act

[1] Article 20 of the former Corporate Tax Act (amended by Act No. 5581 of Dec. 28, 1998), Article 52 (1) of the Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 15970 of Dec. 31, 1998), Article 46 of the former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 15970 of Dec. 31, 1998) (see current Article 88), Article 13 (1) 3 of the former Value-Added Tax Act (amended by Act No. 6049 of Dec. 28, 1999), Article 13 (1) 1 of the former Enforcement Decree of the Corporate Tax Act (see current Article 13 (1) 3-2 of the former Value-Added Tax Act), Articles 50 (1) and 52 (1) of the former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 15971 of Dec. 28, 1998) of the former Corporate Tax Act) / [2]

[1] [2] Supreme Court Decision 2002Du1892 delivered on September 5, 2003 / [1] Supreme Court Decision 85Nu514 delivered on December 10, 1985 (Gong1986, 262) Supreme Court Decision 86Nu532 delivered on March 10, 1987 (Gong1987, 665) Supreme Court Decision 87Nu628 delivered on December 22, 1987 (Gong198, 361) Supreme Court Decision 95Nu18697 delivered on May 28, 1997 (Gong197Ha, 1920) and Supreme Court Decision 97Nu1929 delivered on July 24, 1998 (Gong1997Ha, 1920), Supreme Court Decision 97Nu1929 delivered on July 24, 2019).

Korea Airport Co., Ltd. (Law Firm Squa, Attorney Jeong-hwan, Counsel for defendant-appellant)

Director of the District Office

Seoul High Court Decision 2001Nu2708 delivered on January 18, 2002

The appeal is dismissed. The costs of appeal are assessed against the defendant.

Whether an act constitutes wrongful calculation under Article 20 of the former Corporate Tax Act (amended by Act No. 5581 of Dec. 28, 1998), should be determined on the basis of whether the transaction lacks economic rationality in light of sound social norms and commercial practices, considering the overall circumstances of the transaction (see Supreme Court Decision 2000Du5494, Nov. 14, 200, etc.). Further, Article 13(1)3 of the former Value-Added Tax Act (amended by Act No. 6049, Dec. 28, 199; hereinafter the same shall apply) provides that a business entity receives an unfair lower price than the market price to the extent that it is deemed that the tax burden has been reduced unfairly in the transaction with the person with a special relationship with the business entity, the determination of whether the transaction lacks economic rationality should be made on the basis of an objective basis of equity in taxation burden (see, e.g., Supreme Court Decision 200Du28788, Nov. 28, 2007).

According to the reasoning of the judgment below, the court below determined that the Korea Aviation Corporation prior to the merger of the plaintiff (hereinafter referred to as the "Korea Aviation") applied the rate of 10% discount compared to other trading enterprises while providing oil supply service to the Korean Aviation Corporation (hereinafter referred to as the "Korea Aviation") to the related parties between January 1, 1993 and December 31, 197, and applied the rate of 10% discount compared to other trading enterprises. The Korea Aviation did not constitute an unfair act of disregarding the economic rationality, and the Korea Aviation did not constitute an unfair act of unfairly receiving the price under Article 13 (1) 3 of the former Value-Added Tax Act even if it did not constitute an unfair act of unfairly receiving the price.

In light of the above legal principles and records, the above judgment of the court below is just, and there is no violation of the rules of evidence or misunderstanding of legal principles as to wrongful calculation as otherwise alleged in the ground of appeal.

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition.

Justices Lee Yong-woo (Presiding Justice)