[1] The case holding that the facts charged that constitute part of the crime of evading corporate tax through the amendment of indictment may be added to the existing facts charged

[2] The case holding that since an accusation against a part of the defendant's corporate tax evasion in the year 1999 has an effect on the whole of the facts of the offense, the effect of the accusation against a part of the defendant's corporate tax evasion in the year 199 shall affect the whole of the corporate tax evasion in the year 199

[3] Whether a crime of evading corporate tax is established in case where a person purchases the pertinent shares and disburses cash into the price for the purpose of changing the secret funds held in the form of shares in cash (negative)

[4] In calculating the amount of tax evaded by omitting interest income, whether the amount equivalent to the income tax collected at source under the name of the title trustee should be deducted as the already paid tax amount (affirmative)

[1] The case holding that since corporate tax is a taxable period for a business year, the crime of evasion is established by adding one crime to each business year, and the effect of instituting a prosecution for a part of the inclusive crime is all the inclusive crime, and the prosecutor may add the crime to the facts of the crime in addition to the facts of the crime in the case where the facts of the crime, which constitutes a single comprehensive crime, are additionally discovered during the trial for the facts of the inclusive crime, as long as the prosecutor indicted the defendant for the crime of evading corporate tax in 1999 through the amendment of the indictment, it may add the ancillary facts of the crime, which constitutes a part of the crime of evading corporate tax in 199

[2] The case holding that since an accusation against a part of the defendant's corporate tax evasion in 1999 has an effect on the whole of the facts of the offense, the effect of the accusation against a part of the defendant's corporate tax evasion in 199 shall affect the whole of the corporate tax evasion in 199.

[3] In a case where the title trust shares already acquired and held during the preceding business year were purchased as if they were newly acquired during the pertinent business year and disbursed as the price, there was no exclusion from the corporation in the possession of shares or cash, and it is merely a change in the form of cash of the non-corporate funds held in the form of shares. In addition, even though there was an unfair outflow of cash assets in the account book, it was not newly acquired during the pertinent business year, but an erroneous entry was made in the same amount as the increase in net assets by newly acquiring the existing non-corporate assets during the pertinent business year, which was not newly acquired during the pertinent business year. Accordingly, it does not affect the calculation of the net income or the tax base for the pertinent business year.

[4] Corporate tax collected and paid at source by a financial institution on corporate interest income shall be deducted from corporate tax to be paid at source. In light of the principle of substantial taxation, etc., regardless of the name of the tax authority, if taxes were collected at source as well as taxes imposed on the real owner, regardless of who is the real owner, it should be determined whether the taxes were paid at the actual cost. Thus, even if the taxes were paid at source and paid for corporate interest under the name of the title trustee rather than the name of the corporation, as long as the corporation actually bears such burden, the amount equivalent to the above income tax should be deducted as the already paid tax amount when the corporation calculates corporate tax to be paid.

[1] Article 9(1) of the Punishment of Tax Evaders Act, Article 37 of the Criminal Act, Article 298 of the Criminal Procedure Act / [2] Article 6 of the Punishment of Tax Evaders Act / [3] Article 9(1) of the Punishment of Tax Evaders Act, Articles 14(1) and 40(1) of the former Corporate Tax Act (amended by Act No. 6047 of Dec. 28, 1999) / [4] Article 9(1) of the Punishment of Tax Evaders Act, Articles 4, 14(1), 64(1)4, and 73(1)1 of the former Corporate Tax Act (amended by Act No. 6047 of Dec. 28, 199)

[1] Supreme Court Decision 87Do84 delivered on December 22, 1987 (Gong1988, 373), Supreme Court Decision 96Do1698 delivered on October 11, 1996 (Gong1996Ha, 3370), Supreme Court Decision 99Do3929 delivered on November 26, 199, Supreme Court Decision 99Do274 delivered on March 10, 200 (Gong200Sang, 114), Supreme Court Decision 9Do3403 delivered on April 21, 200 (Gong200Sang, 1333)

Defendant 1 and two others

Both parties

Attorneys Han-chul et al.

Seoul District Court Decision 2001Gohap925 delivered on April 18, 2002

The judgment of the court below is reversed.

Defendant 1 shall be punished by imprisonment of one year and six months, by imprisonment of one year, and by a fine of two hundred million won for Defendant 2.

However, with respect to Defendant 1 and Defendant 2, the execution of each of the above punishment shall be suspended for two years from the date this judgment becomes final and conclusive.

1. Summary of grounds for appeal;

A. Defendant 1

(1) misunderstanding of facts and misapprehension of legal principles

(A) The omission of each corporate tax due to the omission of income

With respect to interest income accrued from the borrowed account managed by Defendant 3 Co., Ltd. (hereinafter “Defendant 3 Company”), Defendant 3 Company bears the income tax on the basis that the name of the trustee was already collected and paid at source of income tax and resident tax, and only the remainder except the interest income tax collected at source was deposited in the borrowed account.

Therefore, even though the corporate tax amount that Defendant 3 failed to accurately include interest income accrued from the borrowed account by Defendant 3 is not 12,88,917 won in the amount calculated by the formula of “(the amount of actual income tax received after taxation + the income tax and resident tax collected under the name of the nominal trustee) 】 corporate tax rate of 28% - income tax, the lower court erred by deeming the corporate tax amount underpaid to be 28% in excess of the above amount as 'the amount of actual income received after taxation 】 (the amount of interest paid after taxation x the corporate tax rate of 28%).

(B) Violation of each source collection obligation

Defendant 3’s money that Defendant 3 paid to Kim Sang-si is not a honorarium under the Income Tax Act, but a retirement additional money that Defendant 3 paid to Shin Chang-jin et al. was contributed to Defendant 3’s subsidiaries for the payment for retirement of Defendant 3’s working in its subsidiary. Thus, there is no obligation to collect income tax from Defendant 3 as to each of the above money, and even if not, Defendant 1 did not have any criminal intent to not perform the obligation to collect income from Defendant 1, the lower court erred by misapprehending the legal doctrine on the obligation to collect income from Defendant 1, thereby convicting Defendant

(2) Improper sentencing

In light of the various sentencing conditions of the instant case, the sentence of the lower court is too unreasonable.

B. Defendant 2

(1) misunderstanding of facts (the destruction of accounting books for the purpose of destroying evidence)

At the time, the period for preserving accounting books in 1995 remains one month, and the National Tax Service received a written notice from the National Tax Service to the year 1999 that it was subject to tax investigation, without any particular consideration, destroyed the accounting books in 1995, and did not destroy the above accounting books for the purpose of destroying evidence for tax evasion. However, the lower court erred by misapprehending facts, thereby finding the Defendant guilty of this part of the facts charged.

(2) Improper sentencing

In light of the various sentencing conditions of the instant case, the sentence of the lower court is too unreasonable.

C. Defendant 3

(1) misunderstanding of facts and misapprehension of legal principles

Defendant 3’s business affairs are limited to KRW 12,88,917 of the corporate tax that Defendant 1 evaded by omitting the interest income of the above borrowed account. Defendant 1 did not violate the obligation to collect income tax sources, and Defendant 2 did not destroy the account books and documentary evidence in 1995 for the purpose of destroying evidence to evade tax, the lower court erred by misapprehending the legal doctrine or by misapprehending the legal doctrine, thereby convicting Defendant 1 of this part of the facts charged.

(2) Improper sentencing

In light of the various sentencing conditions of the instant case, the sentence of the lower court is too unreasonable.

(d) Swords;

(1)Misunderstanding the facts [not guilty of the part concerning the evasion of corporate tax in relation to the trade of nautical miles stock companies among the violation of the Act on the Aggravated Punishment, etc. of Specific Crimes (tax imposed on Defendant 1) and the violation of the Punishment of Tax Evaders against Defendant 3];

If a company has under-reported income by omitting income in the account books or appropriating excessive expenses, and under-reported and paid corporate tax only for the income appropriated above, the omission of income occurs without asking whether the omitted income is reserved in the company as non-funds. Even if the processed income is included at the same time as the deductible expenses, the processing part is denied only the processing part and the additional tax payable cannot be considered when determining the additional amount of income.

Therefore, Defendant 3’s completion of the shares held in the name of tea prior to the towing year 197 was recorded falsely in the book as if they were newly purchased in 197, and leaked KRW 2.34 billion out of the book by borrowing the sale price form constitutes income omission. However, the lower court did not recognize the omission of Defendant 3’s income, and thus acquitted Defendant 3 of this part of the facts charged. In so doing, the lower court erred by misapprehending the legal doctrine on the omission of income and corporate tax evasion, thereby adversely affecting the conclusion of the judgment.

(2) Improper sentencing (as to the defendant)

Considering the fact that the nature of the crime of this case is extremely poor in the nature of the crime of this case, such as: (a) the Defendants, who are major media companies and their executives, using unlawful means, are subject to heavy tax evasion; and (b) the destruction of large amount of accounting books immediately after being notified of the tax investigation, etc., the sentence of the lower court against the Defendants is too un

2. Judgment of party members

A. Prior to the determination of the grounds for appeal above, the Prosecutor changed the part of corporate tax evasion in 1997 among the facts charged in this case against the Defendants to the corporate tax evasion in 1999, and in preparation, the Prosecutor applied for an amendment to the indictment to add the phrase “in addition, Defendant 1 and Defendant 3 have evaded corporate tax 1920,000,000 won in the year 1999, by appropriating excessive disposal loss in selling the above shares in 1998,” and as a result, it changed to the subject of the judgment of the court below as a result of permitting the membership to do so, the judgment of the court below is no longer maintained.

B. The Defendant’s defense counsel asserts that the primary charges are not identical to the primary charges, so the addition of the charges should not be permitted.

However, since corporate tax is a taxable period for a business year, it shall be deemed that the crime of evasion is established by combining each business year (see Supreme Court Decisions 87Do84, Dec. 22, 1987; 87Do84, Dec. 22, 1987; hereinafter the same shall apply). Since the effect of instituting a public prosecution for a part of the general crime is limited to all the general crimes, if the facts constituting the general crimes are additionally discovered during the public trial for the crime of the general crime, a public prosecutor may add the facts constituting the crime as the facts constituting the general crimes pursuant to the amendment procedure of indictment (see Supreme Court Decisions 96Do1698, Oct. 11, 196; 9Do3929,99Do97, Nov. 26, 199; 9Do2744, Mar. 10, 200).

Therefore, it is necessary to allow the prosecutor to add the ancillary charges that constitute a part of the crime of evading corporate tax in 1999, which is a single comprehensive crime through the amendment of the indictment, to the extent that he/she was prosecuted for the crime of evading corporate tax in 1999 by Defendant 1 and Defendant 3.

C. In addition, the Defendants’ defense counsel asserts that the prosecution procedure constitutes invalid in violation of the provisions of the law, since there was no legitimate accusation by a tax official as to the ancillary facts.

On the other hand, the accusation by a tax official under the Punishment of Tax Evaders Act is an expression of intent to punish an offender on the old criminal facts, but it does not necessarily require the presentation of the date, time, place of the same crime as the requirements stated in the indictment and to the extent that the identity of the case can be specified, and it is sufficient to confirm the facts sufficient to confirm what kind of punishment of the Punishment of Tax Evaders Act (see, e.g., Supreme Court Decision 9Do3403, Apr. 21, 200). Since the accusation against a single criminal fact has the whole effect of the offense (if handled separately, it is limited by the complainant up to the scope of punishment in a single criminal case). The Seoul Regional Tax Office's effect on June 29, 201 on the part of the prosecution against Defendant 1 and Defendant 3's corporate tax evasion in the year 199, which is a preliminary criminal offense, shall also affect all the charges of tax evasion in the year 199.

Even though the effect of accusation filed by the director of the Seoul Regional Tax Office on June 29, 2001 does not extend to the preliminary facts charged, if part of the blanket crime is prosecuted and the other part is added to the facts charged due to the changes in indictment, it is reasonable to view that the addition of the facts charged is lawful and effective until the amendments in indictment are made. According to the statement of the written accusation (345 pages) bound in the records of the public trial, which was before the prosecutor added the facts charged as preliminary charges, the Seoul Regional Tax Office on January 14, 2002, which was before the prosecutor added the facts charged to the preliminary charges, can be recognized that the facts of accusation against Defendant 1 and Defendant 3 sold shares held on December 30, 1998 to Samsung Heavy Co., Ltd. and appropriated the cost of acquiring shares in excess of KRW 390,000,000,000 and thus, it should not be viewed that there were legitimate arguments as to the aforementioned preliminary facts charged.

(d)Therefore, the judgment of the court below shall be reversed ex officio by applying Article 364, Paragraph 2 of the Criminal Procedure Act, without examining the reasons for each appeal by the Defendants and the Prosecutor, and the following shall be ruled again through pleading

Criminal facts

Defendant 1 was working in Samsung Group’s visa room, etc. and was employed as the vice president from February 15, 200 through the vice president in charge of the operation and management of Samsung Group’s visa, etc. on March 1, 1995 after being employed as Defendant 3’s managing director on March 1, 1995; the director of the management support team; the director of the management support office on September 26, 1995; the managing support office on January 198; the managing support office on January 20, 200; the managing director of the management support office on January 20, 200; and Defendant 2 was employed as the managing director on November 7, 197; the managing director of the sales support team from April 1, 1995 to the head of the sales support office; and the managing director of the management support office from January 20 to 31, 205 (the head of the management support office).

1. Defendant 1 in collusion with Nonindicted 1, 2, and 3, who is an executive officer or employee of Defendant 3’s financial affairs;

A. (1) At the office of Defendant 3 on November 27, 1997, Nonindicted 1, 2, and 3 do not enter the above 3-year income of Defendant 3 on December 15, 1990 to December 15, 1993, the amount of KRW 390,00 per share 5,00 (total 1.95,000,000) from the above 3-year income from the above 17-year income from the above 3-year income from the 197-year income from the above 3-year income from the 197-year income from the above 3-year income from the 197-year income from the above 3-year income from the 197-year income from the above 3-year income from the 197-year income from the above 3-year income from the 197-year income from the above 3-year income from the above 19000 won account.

(2)(a) from January 1, 1998 to December 31, 1998, in the same manner as described in subparagraph (a)(i) above 1-A of 1998, the income accrued during 128,299,438 is omitted;

(B) On December 30, 1998, at the office of Defendant 3, selling 390,000 shares of the above nautical miles in the above nautical miles Co., Ltd. for KRW 1,99,000,000, and using the unlawful means such as the above '1-A (1) as stated in the above 'A', the book value of the above shares was falsely recorded as KRW 39,40,000,000,000, which is more than the actual acquisition cost of KRW 1.95,000,000,000, which is more than KRW 1.95,000,000,000, which is more than KRW 1.95,000,000,000,000,000,000,000 won, as if the total amount of the book value recorded in the above false means is acquisition cost, it includes an excessive investment loss in the assets.

518,299,438 won (the total amount of the investment assets disposal losses included in the above revenue omitted interest and excess income) shall be omitted from corporate income in the 1998 business year;

(3)from January 1, 1999 to December 31, 1999, omission of corporate income for the 1999 business year, by omitting the 32,357,88 of the income accrued during 1999 in the same manner as the entry in subparagraph (a) (i) of the above 1-1-A in the same manner as the income accrued during 199;

After tax evasion of KRW 558,217,459 in the aggregate of corporate income from the 1997 to the 1999 business year, on March 31, 200, the tax base of corporate tax is determined by deducting the amount which was not deducted from the tax base calculation for each business year thereafter from the losses incurred during each business year within the scope of income for each business year which began within 5 years before the starting date of each business year, from the losses incurred during each business year which occurred within the scope of income for each business year, the actual tax base is 25,929,928,57 won which was deducted from the amount of income from the above income from the 1997 to the 1999 business year x 25,370,811,1288 won which was reduced, the aggregate of income tax from the above income from the 209, the total amount of income tax from the trustee and other unlawful acts related to the Do and the payment period x 1208,129787 won which were omitted and omitted.

(b)as a person responsible for the source of the income tax,

On February 21, 1998, a cartoon, who was to work for Defendant 3 on February 21, 1998, did not collect KRW 600,000 income tax without justifiable grounds while waiting to pay KRW 3,00,000 for the cost of living under the case cost of Defendant 3, while paying KRW 218,397,170 in total of income tax for living expenses and for six other than Defendant 3 on November 19, 200 from the same day, and without justifiable grounds, as stated in the “the details of violation of the obligation to collect the source income tax of [Attachment 3] to November 19, 200,” such as “the details of violation of the obligation to collect the source income tax of the above Kim Jong-si and six others on a total of KRW 27,324,969 in income tax without justifiable grounds;

2. Defendant 2:

A. In collusion with Nonindicted Co. 2 and Nonindicted 3, Defendant 3 provided funds for voice expenses, such as entertainment expenses, to Defendant 3, an affiliated company, by reducing funds from Defendant 3, and resolved to avoid corporate tax by manipulating an accounting book as if Defendant 3 had paid expenses for transportation in normal terms from Defendant 3;

(1) In the office of Defendant 3 on February 27, 1997, the fact that Nonindicted 2 and Nonindicted 3 were Nonindicted 3, even though they were not provided with services by the transportation company, was prepared and approved by submitting a false disbursement sheet and a simplified tax invoice to the effect that they would incur KRW 6,58,000 in the name of the transportation cost for an individual service company, along with a false disbursement sheet and a simplified tax invoice, and then withdrawn funds of the same amount on the following day, and calculated the processing cost by means of manipulating the relevant accounting book as if the company’s funds were spent normally as transportation cost, as shown in paragraphs 1 through 8 of the attached Table 4. “The detailed statement of appropriation of the transportation cost processing income” was included in paragraphs 1 through 8 of the same year from the same year to December 17, 1997; and was omitted in the corporate income for the business year of 197 equivalent to the same amount; and

(2) From January 31, 1998 to December 31, 1998, as shown in Section 9 to Section 15 of the "Detailed Statement of Omission of Income from Calculation of Transportation Expenses", i.e., the total transportation cost of KRW 95,695,00 in the same manner as described in Section 9 to Section 15 of the "Detailed Statement of Omission of Income from Calculation of Transportation Expenses" shall be added to the corporate income of the 1998 business year; and

(3) From February 24, 199 to December 31, 1999, as shown in Section 16 to Section 27 of the "Detailed Statement of Omission of Income from Calculation of Transportation Expenses", i.e., the total transportation cost of KRW 120 million through 12 times in the same manner as described in Section 16 to Section 27 of the "Detailed Statement of Omission of Income from Calculation of Transportation Expenses", and omission, etc. of corporate income equivalent to the same amount for 199 business year;

After tax evasion of KRW 258,316,00 in total of corporate income of the business year 197 through 1999, the corporate tax is reported and paid for the business year 199 on March 31, 200 with the tax return and payment of corporate tax of the business year 199. The corporate tax base is determined by deducting the amount of losses incurred in the business year that began within 5 years before the starting date of each business year within the scope of the income for each business year, which was not deducted from the tax base calculation for each business year thereafter. The actual tax base is 25,629,627,127,128 won including the amount of the above income omitted in the business year 197 through 1999, which was 25,370,81,128 won after deducting the amount of the above income omitted, 200,81,128 won after filing the tax return and making the same day under the same amount less than the tax rate x 25,3728,2008,208 won

B. In collusion with Nonindicted 3 for the purpose of destroying evidence for tax evasion;

After receiving a prior notice from the Seoul Regional Tax Office to commence a corporate tax investigation on February 1, 2001 at the office of Defendant 3, the accounting books and documentary evidence in 1995 shall not be destroyed since five years have not elapsed since the expiration of the period of March 31, 1996, which was the legal deadline for filing corporate tax returns. However, in order to preserve the above tax investigation, Defendant 3’s corporate income was raised as a method of appropriating processing expenses in the 1995 business year by raising the amount of KRW 560,000,000,000,000,000,000,000,000,000,000,000,000,000 were as a corresponding corporate tax, and to avoid detection, it shall be reversed by using the accounting books and documentary evidence for the business year from February 3, 201 to February 7, 2005, the non-indicted 3, an employee of the financial team, and 195 years.

3. Defendant 3 Company

A. As to the defendant's service, defendant 1 who is the employee of the defendant

(i)to evade 122,088,917 won of the corporate tax for the 1999 business year, as described above 1-A;

(ii)no aggregate income tax of KRW 27,324,969, as described above '1-B', shall be collected without good cause;

B. As to the defendant's business, defendant 2 who is the employee of the defendant

(i)Engage 72,328,480 won of the corporate tax for the 1999 business year, as described in the above 2-A;

(ii)The books and documentary evidence for the 1995 business year for the purpose of destroying evidence for tax evasion, such as the above 2-B.

Summary of Evidence

The summary of the evidence of the defendant's criminal facts is as stated in the corresponding column of the judgment of the court below, except for addition of the statement prepared by the final statement, the tax base and tax return of each corporate tax bound on the trial records, the tax base amount and decision decision of the amount of each corporate tax, and each written confirmation (No. 1-6 of the evidence No. 1-6). As such, it is cited by applying Article 369 of the Criminal Procedure Act.

Application of Statutes

1. Article relevant to the facts constituting an offense and the selection of punishment;

A. Defendant 1

(iii)The point of evasion of corporate tax on the market: article 9, paragraph 1, 3 of the Punishment of Tax Evaders Act, article 30 of the Criminal Code (Appointment of Imprisonment);

b)Violation of the obligation to collect each source at the market: Article 11 of the Punishment of Tax Evaders Act and Article 30 of the Criminal Code;

B. Defendant 2

(iii)The point of evasion of corporate tax on the market: article 9, paragraph 1, 3 of the Punishment of Tax Evaders Act, article 30 of the Criminal Code (Appointment of Imprisonment);

(ii)Destruction the books of account on the market: Article 12ter, paragraph 2, of the Punishment of Tax Evaders Act and Article 30, of the Criminal Code (Selection of Imprisonment);

C. Defendant 3

(iii)the evasion of corporate tax on the market: in general, article 3 and article 9, paragraph 1, paragraph 3 of the Punishment of Tax Evaders Act;

(i)an offence against each withholding obligation on the market: Articles 3 and 11 of the Punishment of Tax Evaders Act;

(i)Destruction the books of account on the market: Articles 3 and 12ter, paragraph 2, of the Punishment of Tax Evaders Act;

1. Aggravation of concurrent crimes;

A. Defendant 1

Article 37 (Aggravation of Punishment of Tax Evaders Act in Crimes of Violation of the Punishment of Tax Evaders Act, Articles 38 (1) 2 and 50 (Aggravation of Punishment)

B. Defendant 2

Article 37 (Aggravation of Punishment of Tax Evaders Act in Crimes of Violation of the Punishment of Tax Evaders Act, Articles 38 (1) 2 and 50 (Aggravation of Punishment)

C. Defendant 3

Article 37 (former part)

1. Suspension of execution;

Defendant 1 and Defendant 2: Article 62(1) of the Criminal Act (see, e.g., Constitutional Court Decision 200Do1148, Apr. 1, 2

Parts of innocence

1.First of all, among the facts charged in the instant case, we examine the violation of the Act on the Aggravated Punishment, etc. of Specific Crimes (Tax) against Defendant 1 and the violation of the Punishment of Tax Evaders Act against Defendant 3.

A. Summary of this part of the facts charged

(1) Defendant 1 in collusion with Nonindicted 1, 2, and 3:

On November 27, 1997, at the office of Defendant 3; Nonindicted 1, 2, and 3 are 30 billion won or more of the above 30 billion won of the company’s 40 billion won of the above 40 billion won of the company’s capital increase after taking over the above 300 billion won of the company’s capital increase in the form of an affiliated company which purchased real estate for non-business use in the 1990s of the company’s 30 billion won of the above 40 billion won of the company’s capital increase; and the 390,000 won of the total issued stocks at the time of November 27, 1997’s 1.3 billion won of the above 30 billion won of the company’s capital increase after taking over the 305 billion won of the above 40 billion won of the company’s capital increase, and the 350,000 won of the company’s capital increase in the 305 billion won of the above 4000 billion won of the company’s capital increase.

(2) As mentioned in the preceding paragraph, Defendant 1, an employee of Defendant 3, evaded corporate tax due to an unlawful act in relation to his business.

(b) Markets:

(1)Article 9(1)3 of the Punishment of Tax Evaders Act, Article 8 of the Act on the Aggravated Punishment, etc. of Specific Crimes, and Article 3 of the Punishment of Tax Evaders Act, which are punishment provisions for aggravated punishment, shall be punished by "a person who evades corporate tax by fraudulent or other unlawful act," and the corporation belonging thereto. Therefore, in order to punish the Defendants against the above Article 9(1)3 of the Punishment of Tax Evaders Act, the charges charged should not only fall under "Fraud or other unlawful act," but also it should have resulted in "abrut of corporate tax

In addition, the income, which is the standard for taxation of corporate tax, should be calculated as a unit of each business year, results of ‘the evasion of corporate tax for the business year 1999' [Article 14(1) and Article 40(1) of the former Corporate Tax Act (amended by Act No. 6047 of Dec. 28, 1999; hereinafter referred to as the "former Corporate Tax Act") which is the basis for the imposition and collection of corporate tax for each business year].

In addition, the ‘provoking of corporate tax' is a natural logical premise that the corporation is liable to pay corporate tax.

(2) However, according to the records, Defendant 1 conspired with the officers and employees in charge of financial affairs of Defendant 3 as stated in the facts charged, and Defendant 3 took over nautical miles prior to the 1997 business year to hold real estate for non-business use and held de facto as an affiliated company under the name of 21 persons, other than the profit table, which is employees, and then prepares a false sales contract as if Defendant 3 newly purchased the stocks acquired during the 1997 business year, and makes a false sales contract as if it were to purchase the new stocks, and then makes a false sales contract as if Defendant 3 pays the purchase price to a voluntary deposit account opened in the name of the above profit table, etc. The fact that Defendant 3 paid the purchase price to Defendant 3's account books by making it difficult to trace the taxation authority's non-financial management by withdrawing it again and depositing it to Defendant 3's non-financial account books, the tax base for corporate tax return and payment on March 31, 200 for the business year 199, the tax base for losses accrued within 15 years prior to each business year.

Therefore, since the above series of actions by Defendant 1 constituted "Fraud and other unlawful acts" under Article 9 (1) of the Punishment of Tax Evaders Act, the first requirement among the above elements is satisfied.

(3) Next, as to whether Defendant 1’s above act resulted in Defendant 3’s evasion of corporate tax, the following facts can be acknowledged in full view of the following: (a) each statement made by Defendant 1 and witness Nonindicted 3 in the trial records of the court below in relation thereto; (b) each statement made by the prosecutor against Defendant 1; (c) each statement made by the prosecutor against Nonindicted 3; (d) informed number; (e) Kim Jong-soo; and (e) the final statement made by the officer of the Seoul Regional Tax Office against Defendant 1; and (e) each statement made by the officer of the Seoul Regional Tax Office against Defendant 1 and Nonindicted 3; and (e) each statement written by Nonindicted 3 and Kim Sung-il; and (e) each statement written by each written statement

(A) Defendant 3 acquired and held several real estate in Jeju and Gwangju regions prior to 1990, but did not enter this in the financial statements of the company, such as balance sheet, and held it in the form of so-called “non-financial expense” by trusting the name to others.

(B) Defendant 3 owned approximately 740,000 mar for a marine complex leisure business. However, on May 8, 1990 by the Government’s special economic measure, around 270,000 mar was determined as non-business real estate and sold to a third party.

(C) At that time, Defendant 3, if sold the above 270,000 square meters to a third party, had difficulty in promoting the original marine complex leisure business by impairing the unity of the above 740,00 square meters and excessively narrowing land necessary for the marine complex leisure business. Defendant 3, even if establishing a subsidiary, decided to own real estate determined for non-business use.

(D) Around October 190, Defendant 3 raised funds from sales proceeds of the real estate listed in the above Paragraph (a) and transferred the entire 10,000 shares (5,000 won) issued by the Dormant Enterprise Co., Ltd., a Dormant Corporation to a subsidiary holding real estate for non-business purposes under the preceding paragraph, and changed its trade name to nautical miles.

(E)The nautical nautical miles issued 1.2 billion Won (in total amount, KRW 5,000) over four occasions from March 1991 to December 15, 1993 and increased the total of KRW 6.1 billion. In this case, the Defendant Company 3 additionally accepted 3.8 billion Won (in total amount, KRW 5,000) out of shares out of shares, 1.9 billion (in total, KRW 5,000) out of shares, which were created by selling real property listed in the above paragraph (a).

(F) As such, Defendant 3 was unable to officially enter the acquisition of new shares in the financial statements, such as the company’s balance sheet, and held the name in the name of 22 persons, such as profit table, because it was impossible to acquire new shares in the form of non-financial funds when acquiring new shares of the nautical miles as above.

(G) Defendant 3 complained of various inconveniences, including concerns about the long-term holding of nautical miles stocks, and determined that it would be desirable to return the name as a result of the change of government authorities’ policies, and that all of the above shares should be returned to the company’s name.

(h) While the executives and employees related to the accounting of Defendant 3 have sought the method of returning to the name, it is pointed out that the method of entering in the financial statements is problematic for the external image management of the company. Thus, the shares purchased in the form of 6,000 won per share to the title trustee shall be entered in the financial statements, and the cash paid in the purchase price shall be managed as non-performing assets. The cash, which was reported to Defendant 1, who is the representative director of the management part, was approved on November 27, 1997, the shares trusted in the name of 45,788 shares were purchased in the name of 274,728,00 (45,788 shares x 6,000 won x 300,000,000 won in total, which was held in the name of 300,000 won in the account book of the company, and then the account holder of Samsung 2,505,000,000 won in the name of the above shares deposited 300.

(d)In accordance with the above facts, Defendant 1 had leaked cash in the business year of 1997 outside of the account book, but was leaked in the form of making the existing assets in the form of shares into investment securities in the account book and paying the purchase price, and continued to hold and manage the leaked cash in the business year as the assets of the corporation.

Therefore, in case where the corporation to which all or part of revenues from assets or business legally accrue and the corporation to which it actually accrues are different, the corporate tax shall be imposed by applying this Act to the corporation to which it actually accrues (Article 4(1) of the former Corporate Tax Act). In light of the substance taxation principle of "the calculation of the amount of taxable income subject to corporate tax shall apply (Article 4(2) of the former Corporate Tax Act), regardless of its name, the cash outflow by Defendant 1 did not have any influence on the income which is the corporate tax base for the 199 business year of the instant case.

In other words, in relation to the tax base of corporate tax, the tax law stipulates that income shall be calculated by deducting the amount of losses incurred from transactions which reduce the net assets of a corporation from the amount of profits generated from transactions which increase the net assets of a corporation (Article 14 of the former Corporate Tax Act). This is also the meaning of deducting the expenses that will belong to the current base from the profits that will belong to the current base and calculating the current net assets, and it is also the meaning of calculating profits or losses due to the increase or decrease of assets by comparing the basic net assets and the current net assets. This is the same in that the two differences in the approach, and eventually, it is paid the same amount of net income per unit (Article 197). Since the business year of Defendant 3 was the same as the initial form and contents of assets (whether the assets were entered in the book, and the actual status of assets and cash possessed), the amount of profits and losses generated from the above act of Defendant 1 did not change the amount of profits and losses in the tax base (Article 9 of the former Corporate Tax Act).

(5)The prosecutor argues that there was an omission of income that would affect the tax base of corporate tax immediately if cash is leaked without cause or consideration, but in the case of this case where the title trust shares already acquired and held during the preceding business year were purchased as if they were newly acquired during the previous business year and disbursed as the payment, there was no deviation from the corporation in the holding of shares or cash, but it was merely a shift of non-corporate funds held in the form of cash in the form of cash. In addition, even if there was an unfair outflow of stock in the account book, it was not a new acquisition in the account book, but an erroneous entry was made in the same amount as the increase of net assets by newly acquiring the existing non-corporate assets during the business year, not a new acquisition in the account book, and thus, it did not affect the net assets increase in the same amount. Accordingly, the above argument is without merit.

(6) Accordingly, it cannot be deemed that there was an omission of corporate tax for 199 business year against Defendant 3 in relation to this part, and eventually, Defendant 1 and Defendant 3 as its employer did not meet the requirements of “pro rata corporate tax evasion” under Article 9 of the Punishment of Tax Evaders Act, and there is no evidence to prove otherwise that Defendant 1 had evaded corporate tax of 652 million won for the business year 1999 business year by fraud or other unlawful act. Thus, this part of the charges against Defendant 1 and Defendant 3 should be acquitted under the latter part of Article 325 of the Criminal Procedure Act because this part of the charges against Defendant 1 and Defendant 3 did not constitute a case where there is no proof of crime, and thus, they should be acquitted under the latter part of Article 325 of the Criminal Procedure Act, but it was pronounced guilty of the remaining 199 business year corporate tax evasion. Thus

2. Next, among the facts charged in the instant case, we examine the violation of the Act on the Aggravated Punishment, etc. of Specific Crimes (Taxes) against Defendant 1 and the violation of the Punishment of Tax Evaders Act against Defendant 3, the part that exceeds 12,88,917 won (the part of KRW 122,08,917) found guilty in relation to the omission in the calculation of interest in the violation of the Punishment of Tax Evaders Act against Defendant 3.

(a)A domestic corporation shall pay as corporate tax the amount of corporate tax calculated on the income for each business year minus the corporate tax collected and paid at source by a financial institution on the income for each business year (Articles 64(1)4 and 73(1)1 of the former Corporate Tax Act), so corporate tax collected and paid at source by a financial institution on the income of a corporation for each business year shall be deducted from the amount of corporate tax payable at source by the financial institution;

In addition, in light of the substance over form principle as seen earlier, as the taxation authority imposes tax on the person who is the true owner regardless of the name of the tax authority, it should be determined whether the tax is the already paid tax amount on the basis of who is the actual owner if the tax was collected at the source.

B. In light of the above legal principles, even if the tax amount collected at source and paid for Defendant 3’s interest income was actually borne by Defendant 3 Company as income tax for the title trustee rather than Defendant 3 Company’s name, so long as Defendant 3 Company has actually borne it, the amount equivalent to the above income tax should be deducted as the already paid tax amount when calculating the corporate tax amount to be paid by Defendant 3 Company. Accordingly, Defendant 3 Company’s evaded tax amount through omission of income payment 】 interest amount received after tax 】 not 28% of corporate tax rate 】 (the amount of actual receipt ＋ the income tax and resident tax collected under the name of the title trustee + the income tax collected under the name of the title trustee 28%) 】 corporate tax rate of 28% - the income tax collected under the name of the title trustee 12,88,917 [the total amount of income tax collected under the name of the title trustee 130,585,524 + income tax collected under the name of the name of the title trustee and resident tax amount exceeding 37136,3139%.

(c)Therefore, the facts charged for the portion exceeding the above money should be pronounced not guilty in accordance with the latter part of Article 325 of the Criminal Procedure Act because it constitutes a case where there is no proof of crime. However, each conviction is pronounced for the evasion of corporate tax for the remaining 199 business years. Thus, the decision of innocence shall not be made separately in the text.

Judges Lee Sung-sung (Presiding Judge)