The meaning of “place to be served” and “place to be served” under Article 11(1)3 of the Framework Act on National Taxes, and thus, it was possible to attempt to serve a notice at each place, even if a tax official visited only some of them and confirmed the absence of an addressee, whether a tax official can serve a notice by public notice pursuant to Article 11(1)3 of the Framework Act on National Taxes and Article 7-2 subparag. 2 of the Enforcement Decree of the Framework Act on National Taxes (negative)

Considering the language and text of Articles 8(1) and 11(1)3 of the Framework Act on National Taxes, Article 7-2 subparag. 2 of the Enforcement Decree of the Framework Act on National Taxes, the purport of the public notice system under Article 11 of the Framework Act on National Taxes, and the purport of the public notice system under Article 11 of the Framework Act on National Taxes, and the risk of excessively infringing on the right to a trial under Article 27(1) of the Constitution, allowing service by public notice to be held where documents are not served due to any cause not attributable to a taxpayer, the term “place to be served” under Article 11(1)3 of the Framework Act on National Taxes refers to the taxpayer’s domicile, residence, place of business or office that can be known by the tax authority through an investigation with due care of a good manager, and the taxpayer’s “place to be served” refers to a place where a tax official visits only some place and confirms that there is no recipient, such act does not constitute a case where service by public notice can be served by public notice pursuant to Article 11(1(1)3).

Article 27(1) of the Constitution of the Republic of Korea; Article 8(1) and Article 11 of the Framework Act on National Taxes; Article 7-2 subparag. 2 of the Enforcement Decree of the Framework Act

Plaintiff

Head of Yongsan Tax Office

Seoul High Court Decision 2014Nu70510 decided April 29, 2015

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Article 8(1) of the Framework Act on National Taxes provides that the place for service of documents under the Framework Act on National Taxes or other tax-related Acts (hereinafter “the domicile, residence, place of business, or place of business”) shall be “where the documents are to be served by a person prescribed in Article 10(4) as one of the grounds for service by publication, and Article 11(1)3 provides that “where the documents are not served by a person prescribed in Article 10(4) and are not returned due to the absence of the recipient, etc., as prescribed by Presidential Decree,” and Article 7-2 of the Enforcement Decree of the Framework Act on National Taxes provides that “Where a tax official intends to visit a taxpayer two or more times to deliver documents, but it is deemed difficult for the recipient to serve them within the due date for payment

Considering the language and text of such provision, the purport of the service by public notice as stipulated under Article 11 of the Framework Act on National Taxes, and the fact that allowing service by public notice is likely to excessively infringe on the right to a trial as stipulated under Article 27(1) of the Constitution to be tried by public notice on the grounds that a tax authority may serve by public notice, and the term “place to be served” as stipulated under Article 11(1)3 of the Framework Act on National Taxes refers to a taxpayer’s address or place of business that the tax authority may know by conducting an investigation with due care as a good manager; and even if a taxpayer’s “place to serve” is several, it is possible for the tax authority to attempt to serve a notice at each place, even if a tax official visited only some of them and confirmed that there is no recipient, it does not constitute a case where service by public notice may be served by public notice pursuant to Article 11(1)3 of the Framework Act on National

2. A. The evidence duly admitted by the lower court reveals the following facts.

1) On April 5, 2013, the Defendant issued a correction and determination of KRW 69,679,270 of the global income tax for the year 2007 (hereinafter “instant disposition”). On May 8, 2013, the Defendant confirmed that the Plaintiff’s entry into the Republic of Korea was not the fact of departure from the Republic of Korea until April 28, 2013 after the Plaintiff entered the Republic of Korea on October 12, 2012.

2) On May 9, 2013 and May 12, 2013, the Defendant’s public official visited the housing of Yongsan-gu Seoul Special Metropolitan City ( Address 1 omitted) that is the Plaintiff’s address, to serve a tax payment notice on the instant disposition (hereinafter “instant tax payment notice”) on the Plaintiff. However, on the Plaintiff’s absence, the Defendant’s public official visited the housing of Yongsan-gu, Seoul Special Metropolitan City, which is the Plaintiff’s address, issued a tax payment notice on the Plaintiff’s arrival notice. On May 13, 2013, the Defendant publicly announced the main contents of the instant tax payment notice and served by publication

3) However, from January 31, 2006, the Plaintiff registered his/her business as his/her place of business and paid value-added tax to the Defendant, the address of Yongsan-gu Seoul Special Metropolitan City ( Address 2 omitted) around his/her place of business from around January 31, 2006. After the instant tax payment notice was served by public notice, the Defendant sent a reminder with the demand payment period until June 21, 2013 to the Plaintiff’s place

B. Examining these facts in light of the legal principles as seen earlier, the Plaintiff’s place of business, which can be seen as the Plaintiff’s place of business confirmed by the Defendant’s taxation data, shall not be deemed to have attempted to serve the instant tax payment notice at the Plaintiff’s place of business, and immediately visit the Plaintiff’s place of business two times, and the service by public notice of the instant tax payment notice did not meet the requirements for service by public notice under Article 11(1)3 of the Framework Act on National Taxes and Article 7-2 subparag. 2

C. Nevertheless, solely on the grounds stated in its reasoning, the lower court determined that the instant tax notice was legally served by public notice, and that the instant disposition became effective. In so determining, the lower court erred by misapprehending the legal doctrine on the requirements for service by public notice, thereby adversely affecting the conclusion of the judgment. The allegation contained in the

3. Therefore, without further proceeding to decide on the remaining grounds of appeal, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kwon Soon-il (Presiding Justice)