Seoul High Court 2009Nu36837 (Law No. 10, 2010)

National High Court Decision 2006Du1298 (Law No. 13, 2007)

Since it is insufficient to recognize that the plaintiff knew that there was a defect in the procedures for issuing a gold bullion purchase approval, the disposition that excluded the application of zero tax rate is unlawful.

Where a purchaser sells goods by applying a zero-rate tax, knowing that a false letter of approval for purchase has been issued or that there is a defect in issuing a false letter of approval for purchase, or where the purchaser knowingly uses a defective letter of approval for purchase with the intent to evade the tax, or where there are special circumstances detrimental to the order of collection of value-added tax, such as impliedly

Article 11 of the Value-Added Tax Act and Article 24 of the Enforcement Decree thereof.

2010Du12903 Revocation of Disposition of Imposing Value-Added Tax

XX네트웍스 주식회사

O Head of tax office

Seoul High Court Decision 2009Nu36837 Decided June 10, 2010

October 13, 2011

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

1. Regarding ground of appeal No. 1

According to Article 11(1)1 of the former Value-Added Tax Act (amended by Act No. 7007 of Dec. 30, 2003) and Article 24(2) of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 17186 of Mar. 31, 2001), the zero-rate tax rate shall apply to the supply of exported goods, and even to the goods supplied by an entrepreneur through a local letter of credit or a letter of approval for purchase prescribed in the Foreign Trade Act, the zero-rate tax rate shall apply to such exported goods.

Under the value-added tax system, the application of zero tax rate is recognized only for exports to prevent double taxation, and it is recognized as exceptional or restrictive only for domestic consumption to the extent that it corresponds to the national policy purpose of promoting foreign exchange management and the collection order of value-added taxes within the extent not impairing the above exports. In light of the purport of applying zero tax rate and relevant statutes, in cases where a supplier of goods sells goods by applying zero tax rate with the knowledge that there is a defect in the issuance of a false purchase approval or a defect in the issuance of a purchase approval with the knowledge of the defect in the purchase approval, the buyer knowingly sells the goods for the purpose of export and without the intention of evading taxes, and there are special circumstances that undermine the collection order of value-added tax, such as where he knows of the fact that the supplier uses a defective purchase approval with the intent of evading taxes by selling them in Korea for the purpose of export, it shall not be subject to zero tax rate (see Supreme Court Decision 2003Du3642, Jun. 11, 2004). Such special circumstances must be proved individually for each relevant case.

원심판결 이유에 의하면, 원심은 원고가 2000년도 제1기분, 제2기분 부가가치세 과세기간 동안 XX쥬얼리 등 업체에 공급한 이 사건 금지금(金地金)과 관련하여 이 사건 구매승인서의 발급절차상 수출계약서 등 구비서류를 첨부하지 않은 등의 하자가 있었다는 점만으로 외국환은행장이 발급한 위 구매승인서가 당연무효라고 볼 수는 없고, 위와 같은 발급절차상의 하자가 있었더라도 원고가 그러한 하자를 알고 있었다는 등의 특별한 사정이 없는 한 위 구매승인서에 따른 금지금의 공급이 영세율 적용대상에서 제외될 수는 없다 할 것인데, 제출된 증거들만으로는 2000년도 제1기분, 제2기분 부가가치세 과세기간 동안 원고가 위 업체들로부터 제출받은 이 사건 구매승인서의 발급절차에 하자가 있었음을 알았다고 인정하기에 부족하고, 원고가 최소한의 주의만 기울였다면 그 발급절차에서의 하자 또는 위 업체들이 수출을 빙자하여 공급받은 금지금을 국내에 유통하리라는 점을 알 수 있었다는 사정만으로는 영세율 적용을 배제할 수 없다고 하여 이 사건 금지금 공급에 영세율을 적용하여야 한다는 취지로 판단하였다.

In light of the above legal principles and records, the above judgment of the court below is just, and contrary to the allegations in the grounds of appeal, it did not err by misapprehending the legal principles on the application of zero-rate tax rate under the Value-Added Tax Act.

2. Regarding ground of appeal No. 2

According to the reasoning of the lower judgment, the lower court determined that the Defendant’s additional tax is unlawful on the ground that the instant tax invoice does not constitute “when all or part of the requisite entries of the tax invoice under Article 22(2)1 of the former Value-Added Tax Act is different from the fact,” inasmuch as Article 54 subparag. 3 of the Enforcement Decree of the Value-Added Tax Act recognizes the special case where the actual transaction is confirmed by relevant documentary evidence, etc. and a tax invoice is issued with the date of the relevant transaction as the relevant transaction is issued by the 10th day of the month following the month in which the date of supply falls.”

In light of the relevant legal principles and records, the above judgment of the court below is just, and contrary to the allegations in the grounds of appeal, there is no error of law by misapprehending the legal principles on the special case of issuance

3. Conclusion

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