Cho High Court Decision 2014Da4374 ( December 01, 2014)

Even if it is registered as a representative director on the corporate register, if it is not actually operated, the income of the corporation whose ownership is unclear shall not be reverted to him.

The actual operator appears to be the defendant assistant intervenor, and the plaintiff was registered as the representative director and cannot be actually operated. Thus, each of the dispositions of this case where the plaintiff is deemed the representative director and the comprehensive income tax is imposed on the plaintiff is unlawful.

Article 67 (Disposal of Income)

2015Guhap176 global income and revocation thereof

AA

BB Director of the Tax Office

November 9, 2016

December 21, 2016

1. The Defendant’s imposition of global income tax of KRW 2, 620, 620, and global income tax of KRW 126, 820 on June 1, 201 to the Plaintiff on June 1, 2014 shall be revoked.

2. The costs of the lawsuit are assessed against the defendant.

Cheong-gu Office

The main text of Paragraph 1 is as follows (A evidence Nos. 1-1 and 2) (The correction is made as follows, since it is apparent that the date of each disposition for imposition stated in the purport of the claim is a clerical error in the register of June 3, 2014 and June 10, 2014).

1. Details of the disposition;

A. Since its establishment on July 5, 201,CC Co., Ltd. (hereinafter “CC”) was established on July 5, 201, it was a company with 000-0 mobile 00-0, at Jeju, engaged in painting construction business, etc., and the Plaintiff was registered as the representative director ofCC from the time of its establishment until March 15, 2013.

B. AsCC did not report corporate tax for each business year in 2011 and 2012, the Defendant issued a disposition to estimate corporate tax for each business year in 201 and 2012, the Defendant imposed tax on the Plaintiff, who is the representative director on the register ofCC, on June 1, 2014 pursuant to Article 67 of the Corporate Tax Act and Article 106(1) of the former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 26981, Feb. 12, 2016); and on June 3, 2014, global income tax for 20 years and 620 won for global income tax for 201 and June 10, 2012 (hereinafter collectively referred to as “each disposition”).

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, 4, Eul evidence 1 to 5 (including each number; hereinafter the same shall apply), the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

① The Plaintiff is merely a representative director under the name ofCC, and the actual representative director is the Defendant’s assistant intervenor. Each of the instant dispositions violates the principle of substantial taxation. ② Each of the instant dispositions violated the principle of taxation based on the tax base and tax amount when determining the tax base and tax amount, and ③ each of the instant dispositions should be revoked on the grounds that the grounds for calculating the tax amount are not properly stated in the tax notice.

B. Relevant statutes

The entries in the attached Table-related statutes are as follows.

C. Determination

First, we examine whether the Plaintiff is a representative director in the name ofCC.

Even if a person is registered as a representative director on the corporate register of a company, if the company does not actually operate the company, no comprehensive income tax may be imposed on such person by devolving income of which the company is missing (see Supreme Court Decision 2010Du18116, Dec. 23, 2010).

The fact that the Plaintiff was registered as the representative director ofCC from July 5, 2011 to March 15, 2013 is as seen earlier.

However, comprehensively taking account of the evidence evidence evidence Nos. 7 through 11, Eul evidence Nos. 6, witness DD and EE testimony and the overall purport of each testimony and pleading, the plaintiff operated "FF, a seal company" since 2003. The plaintiff continued to operate the above company even from July 5, 201 to March 15, 2013 whereCC operated the above company. ② The defendant CC operated the GG P PPPS sales office at Jeju 00-0, and proposed the establishment of the company to receive consent from the plaintiff's seal, etc. on or around 2011, the defendant CC was established as an intervenor's capital or the representative director of the CC, and the plaintiff CC was established as the 200 million capital and the 3CC's shares were owned by each of the plaintiff CC's 200 billion capital and the 3CC's shares were owned by each of the plaintiff CC's 400 billion capital and shares.

According to the above facts, the actual operation ofCC from July 5, 201 to March 15, 2013 appears to be the defendant assistant participant. The plaintiff was registered as the representative director ofCC, but cannot be deemed to have actually operatedCC. Thus, each of the dispositions of this case where the plaintiff deemed the plaintiff as the representative ofCC and imposed the comprehensive income tax on the plaintiff is unlawful.

3. Conclusion

Therefore, the plaintiff's claim of this case is reasonable, and it is decided as per Disposition by admitting it.