Pww (Law Firm Barun, Attorneys Jeong Jin-jin et al., Counsel for the defendant-appellant)

Head of Dong Daegu Tax Office

Daegu District Court Decision 2012Guhap562 Decided June 20, 2012

October 19, 2012

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked. The imposition of the penalty tax of KRW 65,883,150 against the plaintiff on August 16, 2011 shall be revoked.

1. Details of the disposition;

A. The Plaintiff, a corporation engaged in the food and beverage manufacturing business in Daegu-gu, Dong-gu, Daegu-dong (number omitted), issued an electronic tax invoice for KRW 21,295,100,980 out of the sales amount of KRW 24,252,760,933 during the taxable period of value-added tax for the first term of 2010 ( June 30, 2010), and filed a return and payment of value-added tax for the first term portion of 24,252,760,93.

B. During the reporting period of value-added tax in January 2010, the Plaintiff sent a list of tax invoices issued to the Commissioner of the National Tax Service with respect to some of the above amount of KRW 21,295,100,980 to the Commissioner of the National Tax Service within the period designated under Article 16(3) of the Value-Added Tax Act, but the remaining amount of KRW 6,58,542,000 was not transmitted to the Commissioner of the National Tax Service, and the list of tax invoices issued by each customer was

C. On August 16, 2011, the Defendant confirmed the fact that part of the details of issuance of the tax invoice as above were not transmitted, and issued a list of the total tax invoices by customer to the Plaintiff, and issued the instant disposition to rectify and notify the Plaintiff of KRW 65,883,150 as additional tax for the first term portion of 2010 pursuant to Article 22(4)1 of the former Value-Added Tax Act (amended by Act No. 10409, Dec. 27, 2010; hereinafter “former Value-Added Tax Act”).

[Ground of recognition] Facts without dispute, Gap evidence 2, 8, Eul evidence 1, 2, Eul evidence 3-1 to 12, Eul evidence 4-1, 2, Eul evidence 5-1 to 24, and the purport of the whole pleadings

2. Summary of the plaintiff's assertion

A corporate entrepreneur and individual entrepreneur whose size is not less than a certain size shall be obligated to issue an electronic tax invoice under tax-related Acts and subordinate statutes and may not issue a general tax invoice. Even if a corporate entrepreneur has failed to transmit a detailed list of the issuance of an electronic tax invoice, the liability for additional tax shall be exempted until December 31, 2010, and the additional tax rate shall be 0.3% until December 31, 2012, and the additional tax rate shall be 1% from January 1, 2013. In light of such circumstances, legislative intent of the electronic tax invoice system, legislative history, etc., where an entrepreneur who issued an electronic tax invoice fails to transmit a detailed list of the tax invoice issued to the Commissioner of the National Tax Service, where the entrepreneur fails to submit a detailed list of the list of tax invoices by customer pursuant to Article 22(4)1 of the former Value-Added Tax Act, the disposition of this case’s penalty tax cannot be imposed on the Plaintiff prior to the failure to issue the tax invoice under Article 22(2)2 of the former Value-Added Tax Act.

3. Related statutes;

Attached Table 1 is as stated in the relevant Acts and subordinate statutes.

4. Determination

A. According to Article 16(2) of the former Value-Added Tax Act, a corporate entrepreneur must issue an electronic tax invoice by electronic means as prescribed by the Presidential Decree: Provided, That by December 31, 2010, a tax invoice other than an electronic tax invoice may be issued by December 31, 2010, and according to Article 16(3) of the same Act, when an electronic tax invoice is issued, a detailed statement of issuance of the tax invoice shall be transmitted

According to Article 20(1) of the former Value-Added Tax Act, where an entrepreneur issues or receives a tax invoice including the case of issuing an electronic tax invoice under Article 16(2) of the same Act, he/she shall submit a list of total tax invoices by customer and a list of total tax invoices by customer along with a preliminary or final return: Provided, That the same shall not apply where an electronic tax invoice is issued and a list of total tax invoices by customer

According to the main sentence of Article 22(2)2 of the former Value-Added Tax Act, where an entrepreneur who has issued an electronic tax invoice fails to transmit the details of issuance of the tax invoice to the Commissioner of the National Tax Service by the 15th day of the month following the end of the taxable period in which the time of supply for goods or services falls, penalty tax equivalent to 1/100 of the value of supply shall be imposed: Provided, That the foregoing provision shall not apply to a corporate entrepreneur until December 31, 2010, and the penalty tax rate of 3/100 shall apply from January 1, 201 to December 31, 2012.

In addition, according to Article 22(4)1 and 2 of the former Value-Added Tax Act, where a person fails to submit a list of total tax invoices by customer under Article 20(1) or some of the items to be entered in the list of total tax invoices by customer submitted are omitted or mistakenly entered, an amount equivalent to 1/100 of the value of supply of the portion not entered in the list of total tax invoices by customer submitted or entered differently from the fact shall be imposed.

Meanwhile, according to Article 22 (8) of the former Value-Added Tax Act, Article 22 (4) of the same Act does not apply to the part to which this Article applies.

B. According to Article 20(1) of the former Value-Added Tax Act, if an entrepreneur issues an electronic tax invoice pursuant to the proviso of Article 16(2) for the issuance of the 20th tax invoice, it is clear that the entrepreneur will not submit a list of the total tax invoices; provided, however, that if an electronic tax invoice is issued, it may not be submitted for the submission of the 20th tax invoice without any provision on the issuance of the 2th tax invoice. This provision provides that the entrepreneur will be exempt from the duty to submit a list of the total tax invoices; provided, however, that if an electronic tax invoice is not sent for the submission of the 2th tax invoice, the entrepreneur would not be obliged to submit a list of the total tax invoices; provided, that the entrepreneur would not be obliged to submit a list of the total tax invoices; provided, that the entrepreneur would not be obliged to submit a list of the total tax invoices due to the issuance of the 2th tax invoice without any provision on the 3th tax invoice. This provision would be meaningful for the Plaintiff to submit the 20th tax invoice.

Therefore, even if the Plaintiff issued an electronic tax invoice before December 31, 2010, the Plaintiff did not transmit the details of issuance of the tax invoice for some supply values to the Commissioner of the National Tax Service, and did not submit the list of the total tax invoices by customer to the Commissioner of the National Tax Service, the Plaintiff cannot be exempted from additional tax as to the failure to submit the list of the total tax invoices by customer corresponding to that portion. Therefore, the Defendant’s disposition with the same purport is lawful,

5. Conclusion

Therefore, the plaintiff's claim of this case is dismissed due to the lack of reason, and the judgment of the court of first instance is just and there is no ground for appeal of the plaintiff, and it is so dismissed as per Disposition.

[Attachment Form 5]

Judges Lee Jae-sung (Presiding Judge)