[1] The case holding that where the designation of the defendant was erroneous in a tax lawsuit, the court's rejection of the lawsuit immediately without correcting the defendant by exercising the right of explanation is unlawful

[2] Time when the resident tax liability to be imposed on the increased corporate tax base is established

[1] The case holding that if the plaintiff mistakenly designated the defendant, it is unlawful to dismiss the lawsuit on the ground that the designation of the defendant was erroneous without taking such measures despite the fact that the court should have exercised its right of explanation and had the plaintiff proceed with the lawsuit by correcting the defendant.

[2] The liability to pay corporate tax is established on the last day of the pertinent business year, which is the date on which the liability to pay corporate tax is established, and in this case, the taxpayer shall pay and pay the resident tax to the head of the competent Si/Gun within 120 days from the last day of the business year. However, where the taxpayer fails to report corporate tax or makes a decision or correction due to an error or omission in the details of the report, and the head of the competent tax office makes a decision or correction, the liability to pay corporate tax shall be established only when the corporate tax which is the object of taxation becomes final and conclusive. In this case, the taxpayer shall pay and pay resident tax to the head of the competent Si/Gun within 30 days from the due date of payment of the notice, and if he neglects to do so, the head of the competent Si/Gun may collect the corporate tax by adding the additional tax determined as the tax base to the additional tax.

[1] Articles 13 and 14 of the Administrative Litigation Act, Article 136 of the Civil Procedure Act / [2] Articles 177-2 and 178 (2) of the former Local Tax Act (amended by Act No. 6060 of Dec. 28, 199)

[1] Supreme Court Decision 85Nu621 delivered on November 12, 1985 (Gong1986, 64) Supreme Court Decision 89Nu1032 delivered on January 12, 1990 (Gong1990, 471) Supreme Court Decision 96Nu1757 delivered on February 28, 1997 (Gong1997Sang, 966) Supreme Court Decision 97Nu1990 delivered on November 11, 197 (Gong197Ha, 3868)

The receiver of the Ilsung Construction Co., Ltd. (Attorney Lee Jae-soo, Counsel for the plaintiff-appellant)

South Won-si and 2 others

Gwangju High Court Decision 2001Nu2422 delivered on July 25, 2002

The part of the judgment of the court below regarding Defendant Jeonju market is reversed, and this part of the case is remanded to the Gwangju High Court. Each appeal against Defendant Namwon market and Ansan market is dismissed. The costs of appeal to the Supreme Court are assessed against the Plaintiff.

1. As to the appeal against the defendant Jeonju Market

The court below rejected the lawsuit seeking revocation of the disposition of the resident tax of this case by the head of Jeonju-si, on the ground that the lawsuit of this case against the head of Jeonju-si, who is the disposition agency, is unlawful, even though the lawsuit of this case against the head of Jeonju-si, which is the disposition agency.

However, if the plaintiff mistakenly designated the defendant, the court below should have exercised its right of explanation and had the plaintiff correct the defendant as the head of the Jeonju-si, Jeonju-si, a disposition agency (see, e.g., Supreme Court Decisions 85Nu621, Nov. 12, 1985; 96Nu1757, Feb. 28, 1997; 96Nu1757, Feb. 28, 1997); however, the court below's dismissal of the lawsuit of this case against the defendant Jeonju-si, which caused the error of designation of the defendant without taking such measures, to the effect of the judgment. The plaintiff's ground for appeal pointing this out is with merit.

2. As to the appeal against the defendant Namwon market and the Ansan market

Article 177-2 (1) of the former Local Tax Act (amended by Act No. 6060 of Dec. 28, 1999; hereinafter referred to as the "Act") provides that a person liable to pay corporate tax shall, in principle, pay and pay resident tax to the head of the competent Si/Gun within 120 days from the end of the relevant business year, and where the amount of tax is determined or corrected under the Corporate Tax Act or the Framework Act on National Taxes, the person liable to pay corporate tax shall pay and pay it within 30 days from the due date of payment of the notice. Article 178 (3) provides that where a person liable to pay corporate tax fails to make a return and pay, or the amount of tax is below that calculated under Article 178, the amount of tax calculated under the provisions of Article 178 or the amount of tax paid by adding 20/100 to the insufficient amount of tax shall be collected by an ordinary collection method. Article 178 (1) of the Corporate Tax Act provides that the amount of corporate tax to be reported or corrected shall be collected as a penalty pursuant to Article 176 (2).

In light of the purport of the above provisions, the liability to pay corporate tax is established on the end of the business year, which is the date on which the liability to pay corporate tax is established, and in this case, the taxpayer shall pay and pay the resident tax within 120 days from the end of the business year. However, where the taxpayer fails to report corporate tax or the head of a tax office makes a decision or correction due to an error or omission in the details of the report, the liability to pay corporate tax shall be established only when the taxpayer makes a decision or correction. Therefore, the taxpayer shall pay and pay the resident tax to the head of the competent Si/Gun within 30 days from the due date of payment of the notice, and if he neglects it, the head of the competent Si/Gun may collect the resident tax to pay the corporate tax by adding the additional tax after determining the amount of the tax as the tax as the tax base pursuant to Article 178 (2) of the Act

According to the reasoning of the judgment below, the court below acknowledged that the head of Mapo Tax Office issued a disposition of correction to increase the tax base and amount of corporate tax on November 1, 1999 on the ground that there was an error or omission in the details of corporate tax returns filed by the plaintiff on March 1, 1994, 195, and 196 on March 1, 199 as a result of the tax investigation conducted against the plaintiff. Accordingly, the defendant Won Won original market and Ansandong market made a disposition of imposing corporate tax on the above increased corporate tax as the tax base between August 8, 200 and October 10 of the same year. However, the plaintiff did not report the reorganization claim of this case on April 23, 1999 and the company reorganization procedure commenced on June 9 and December 8, 200, and approved the reorganization plan on February 1, 200.

In light of the above legal principles and records, we accept such recognition and determination by the court below as just, and there is no error of law such as misunderstanding of legal principles as to the time when the resident tax liability to pay corporate tax is established. Therefore, the ground of appeal on this point is without merit

3. Therefore, the part of the judgment of the court below which dismissed the lawsuit against the defendant Jeonju market shall be reversed, and that part of the case shall be remanded to the court below. All appeals against the defendant Namwon market and Ansan market shall be dismissed. The costs of appeal against the dismissal of the appeal shall be borne by the losing party. It is so decided as per Disposition

Justices Cho Cho-Un (Presiding Justice)