Seoul Administrative Court-2016-Guhap-5764 ( December 22, 2016)

Early High Court Decision 2015No5081 ( December 28, 2015)

(2) The legality of the subsequent request for correction by reason of the exercise of the right of revocation

Even if the right of revocation was already exercised, it is illegal and invalid to satisfy the requirements for the exercise of the first right of revocation, and it is reasonable to view that each of the instant lending contracts was revoked only due to the exercise of the second right of revocation after the judgment of conviction was rendered. Thus, the instant rejection disposition is unlawful.

Article 45-2 of the Framework Act on National Taxes

2017Nu33413 Revocation of revocation of the revocation of the rectification of global income tax

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○○ Head of Tax Office 4

June 14, 2017

August 16, 2017

1. Revocation of a judgment of the first instance;

2. On August 17, 2015, the head of ○○○ Tax Office issued a disposition of refusal of correction against Plaintiff AA on June 29, 2015, the head of ○○ Tax Office issued a disposition of refusal of correction against Plaintiff AB on June 29, 2015, the head of ○○ Tax Office issued a disposition of refusal of correction against Plaintiff ACC on August 12, 2015, the head of ○○ Tax Office issued a disposition of refusal of correction against Plaintiff AD on August 12, 2015, and the head of ○○ Tax Office issued a disposition of refusal of correction against Plaintiff AD on August 10, 2015.

3. The total costs of the lawsuit shall be borne by the Defendants.

The same shall apply to the order.

1. Details of the disposition;

This part of the judgment of the court is the same as the corresponding part of the judgment of the court of first instance except for the modification of the judgment of the court of first instance as follows. Thus, this part of the judgment is cited as it is in accordance with Article 8(2) of the Administrative Litigation Act and the main sentence

○ 3 pages 10 in the attached Form 10 shall be amended to "attached Form 1 of the Judgment of the first instance".

○ 4 7 pages “Plaintiffs on May 21, 2015” was amended to “Plaintiffs AA on June 1, 2015; and the rest of the Plaintiffs on May 21, 2015.”

2. Whether the rejection disposition of this case is legitimate

A. Summary of the plaintiffs' assertion

Since around January 208, B, etc. entered into a loan contract with the Plaintiffs and used the method of collecting interest and borrowing money again to the Plaintiffs in the way of so-called ‘humping' in order to induce re-investment of the Plaintiffs after concluding the loan contract with the Plaintiffs from January 2008, it was revealed by the criminal final judgment of the instant case, the lending contract that the Plaintiffs entered into with BB, etc. during the key taxable period (hereinafter referred to as the "each lending contract of this case") is both by means of fraud BB, etc.

B. Relevant statutes

The judgment of the court of first instance is as shown in the attached Form.

C. Determination

1) Article 25-2 Subparag. 2 of the Enforcement Decree of the Framework Act on National Taxes, upon delegation of Article 45-2(2)5 of the same Act, refers to cases where a contract relating to the validity of transaction or act, etc., which served as the basis for calculating the tax base and amount of tax, is rescinded by the exercise of the right of rescission or where the contract is cancelled or cancelled due to unavoidable reasons that occurred after the formation of the pertinent contract, when the transaction or act, etc., which served as the basis for calculating the tax base and amount of tax when the initial return, determination, or correction is made. The purpose of the ex post facto request for correction is to expand the protection of taxpayers’ rights by allowing the taxpayer to prove the relevant fact and claim for reduction (see Supreme Court Decision 2009Du22379, Jul. 28, 2011). Unless otherwise provided for in individual tax-related Acts, the scope of application thereof shall not be without permission.

2) In full view of the following facts and circumstances that can be recognized by comprehensively taking into account the evidence, evidence, evidence, evidence, and evidence Nos. 7, and evidence Nos. 3 (including serial numbers; hereinafter the same shall apply) cited by the court of first instance, all of the instant lending contracts are legally revoked upon Plaintiff A’s declaration of revocation as of June 1, 2015, and the remaining plaintiffs’ declaration of revocation as of May 21, 2015. This constitutes a ground for filing a subsequent request for correction under Article 45-2(2)5 of the former Framework Act on National Taxes and Article 25-2(2)2 of the Enforcement Decree of the same Act, and the Plaintiffs’ request for correction on June 12, 2015, which is within three months from the date on which the Plaintiffs became aware of the occurrence of the grounds under Article 45-2(2)5 of the Framework Act on National Taxes, and thus, the instant rejection disposition is unlawful.

① From 2005 to 2012, CCC established and operated “○○ Asia” and BB is the mother of CCC. BB from January 2008 to 17, 2000, if CCC’s art transaction funds were to be lent from 000 to 00, it would pay a large amount of interest in cash received from 00 if the funds were to be borrowed from 00 to 00, and CCC wired money to 2B for borrowed money, and CCC transferred money to 00, 000 to 00, 100, 100, 200, 100, 200, 200, 10, 200, 200, 10, 200, 200, 200, 200, 10, 200, 200, 200, 10, 200, 200, 20, 200, 200.

② At the time of borrowing money from the Plaintiffs, BB, etc., the circumstance that the Plaintiffs’ money was used for a business for a long period, including the short-term resale of art works, not for the creation of art galleries, and the fact that the earnings paid to the Plaintiffs were paid as loans by other investors, not for the sales of art works. It seems that the Plaintiffs would not have concluded each of the instant lending contracts if they were aware of such circumstances.

③ BB, etc. was convicted of the same criminal facts as referred to in the above paragraph (1) (However, only the part concerning the borrowed money that was paid after September 201, which was charged), and was sentenced to a five-year conviction of imprisonment and a six-month conviction of fraud due to a violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Fraud). The judgment became final and conclusive around that time (Seoul Western District Court Decision 2014Dahap000, Oct. 17, 2014; Seoul Western District Court Decision 2014No000, Apr. 9, 2015; Supreme Court Decision 2015Do000, Jun. 24, 2015; Supreme Court Decision 2016Da000, Jun. 22, 2016).

④ Accordingly, on June 1, 2015, Plaintiff AA sent a notice of cancellation of each of the instant lending contracts (Evidence 2) to BB, etc. on the grounds of deception BB, etc. on May 21, 2015. The remaining Plaintiffs sent the notice of cancellation of each of the instant lending contracts to BB, etc. at that time. The notice reached BB, etc.

⑤ The amount of unjust enrichment equivalent to the interest to be returned by the Plaintiffs to BB, etc. following the cancellation of each of the instant lending contracts falls short of the amount of unjust enrichment equivalent to the invested principal to be returned to the Plaintiffs by BB, etc., and was de facto deducted from the Plaintiffs’ claim for return of unjust enrichment equivalent to the invested principal (However, in the case of Plaintiff ACC, it recovered more than KRW 00,000

3) Determination as to the defendants' assertion

① The Defendants asserted that the Plaintiff’s subsequent claim for correction against BB was unlawful since then on June 2013 due to the cancellation of each of the instant lending contracts from BB due to deception by BB, etc. (hereinafter “the first cancellation right”), and that the remaining Plaintiffs’ subsequent claim for correction after June 2015 was filed for more than three months from the date of knowing that the cause under Article 45-2(2)5 of the former Framework Act on National Taxes occurred. However, it is reasonable to view that the Plaintiffs’ respective lending contracts were revoked on the grounds of deception by BB, etc., but there was no evidence to acknowledge deception by BB, etc. (hereinafter “the Seoul High Court Decisions 2014Nu40793, Apr. 1, 2014; hereinafter “the second cancellation right”) were revoked due to the subsequent cancellation of each of the instant lending contracts from BB, etc., and there was no evidence to acknowledge BB deception, etc.

② Under Article 25-2 subparag. 2 of the Enforcement Decree of the Framework Act on National Taxes, the Defendants asserts that a request for correction may be made in the event of cancellation or cancellation due to unavoidable reasons that occurred after the formation of the pertinent contract. However, since the deception of BB, etc. existed at the time of the conclusion of each of the instant contracts, such deception cannot be made by the cancellation of a contract on the grounds of this reason. However, the cancellation of a contract under the Civil Act is based on defects in the process of the establishment of a juristic act, such as influence, mistake, fraud, malpractice, etc., and thus it is difficult to present the case of cancellation of a contract on the grounds of a separate ground, so it cannot be interpreted that only the cancellation can be seen as a “efluence” and that it can not be interpreted as a “efluence”. This part of the Defendants

(3) The Defendants asserted in this case the cancellation of each of the lending contracts of this case was an attack and defense in the course of the lawsuit, in which the rest of the Plaintiffs, other than the Plaintiff ACC, filed a prior suit against the initial disposition, but the judgment was affirmed, and thus, the judgment was affirmed. Therefore, the assertion that each of the lending contracts of this case was revoked is contrary to res judicata. However, the prior suit is a revocation suit against the disposition imposing global income tax, and the lawsuit of this case is a lawsuit seeking revocation of the disposition rejecting the Plaintiffs’ claim for correction, and it is difficult to deem that res judicata effect of the prior suit extends to

3. Conclusion

Thus, the plaintiffs' claims against the defendants will be accepted in its reasoning. Since the judgment of the court of first instance with different conclusions is unfair, it is revoked in its entirety and the rejection disposition of this case is revoked.