Seoul Administrative Court 2007Guhap6717 ( October 21, 2010)

Cho High Court Decision 2005No444 ( November 16, 2006)

Whether it is excessive to a nominal transaction which is not a actual transaction related to gold bullion;

It is difficult to conclude that the purchase of gold bullion is a series of nominal transactions for the purpose of tax evasion without actual delivery or transfer of goods.

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

△△△ Corporation

Head of the tax office;

1. The defendant's appeal is dismissed.

2. The costs of appeal shall be borne by the Defendant.

Purport of claim and appeal

1. Purport of claim

The Defendant’s imposition of value-added tax for the first term portion for the year 2002 against the Plaintiff on April 1, 2005, of KRW 96,94,240, value-added tax for the second term portion for the year 2002, KRW 33,598,360, value-added tax for the year 271 for the year 2002, KRW 12,012,350,490, value-added tax for the second term portion for the year 2003, KRW 32,581,092,230, value-added tax for the year 204, KRW 40,512,224,940, value-added tax for the second term portion for the year 204, and KRW 14,790,560 for the business year 202 shall be revoked in all.

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. Acceptance of a judgment of the court of first instance;

The reasoning for this Court’s reasoning is as follows: (a) the part concerning the Defendant’s argument is 9 pages 8 of the judgment of the court of first instance; and (b) the part concerning the Defendant’s argument is 3 as follows; and (c) the reasoning of the judgment of the court of first instance is identical to that of the judgment of the court of first instance, except where the part concerning the Defendant’s argument is used to be without merit as follows; and (d) such part is cited as it is in accordance with

2. The contents that have been changed;

D. Judgment on the defendant's assertion

1) The assertion that the input tax deduction in the instant case conflicts with the principle of good faith

The defendant asserts that the purchase transaction of this case violates the principle of good faith required by the taxpayer, and thus, the input tax deduction by the tax invoice of this case is not allowed, since the plaintiff's purchase transaction of this case is a serious criminal act that acquired the national treasury by acquiring through the use of the input tax deduction system of the pre-stage input tax and

Therefore, in order to apply the principle of good faith to taxpayers, there is an objectively contradictory taxpayer's behavior, the behavior was caused by the taxpayer's severe acts of worship, and the trust of the tax authority resulting therefrom is worth being protected (see, e.g., Supreme Court Decision 2006Du14865, Apr. 23, 2009). The circumstance asserted by the defendant alone does not lead to the existence of the plaintiff's objective behavior inconsistent with the input tax deduction of this case, or formation of any trust worth being protected to the defendant. Since the plaintiff transferred the right to use and consume goods, such as purchasing gold bullion from the purchaser of this case and selling it to the seller, it cannot be deemed that any defect exists in the tax invoice of this case, and it cannot be determined whether to deduct input tax in accordance with the motive or purpose of the transaction in accordance with the purport of the tax invoice system, and even if the former representative director was convicted of a criminal offense committed by the tax evasion, this part of the defendant's assertion is without merit.

2) The assertion that the transaction in the instant case is null and void in violation of Article 103 of the Civil Code

The Defendant asserts that the instant transaction is null and void as a juristic act contrary to social order stipulated under Article 103 of the Civil Act, which is a transaction for the purpose of committing a criminal act that is tax evasion using gold bullion transformation without a purpose of creating profit through normal economic activities.

Therefore, "Juristic act against social order" under Article 103 of the Civil Act includes not only cases where the contents of rights and obligations, which are the object of the juristic act, violate good morals and other social order, but also cases where the juristic act is legally enforced or its contents are associated with conditions or money which are contrary to the foundation of social order, and the motive of the juristic act indicated or known to the other party is anti-social order (see, e.g., Supreme Court Decisions 9Da56833, Feb. 11, 2000; 2009Da37251, Sept. 10, 2009). Thus, this part of the defendant's assertion is without merit because the reason alleged by the defendant alone does not constitute a juristic act against social order under Article 103 of the Civil Act.

3. Conclusion

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