Plaintiff (Law Firm Jinjin, Attorneys Lee Jae-hoon et al., Counsel for plaintiff-appellant)

Head of Namyang District Tax Office

February 20, 2014

Suwon District Court Decision 2013Guhap128 Decided July 30, 2013

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 defendant's disposition of imposition of global income tax of KRW 42,622,680 against the plaintiff on September 1, 2012 shall be revoked.

1. The part citing the judgment of the court of first instance

Of the reasoning of the judgment of this court, the part of the first instance court’s “from July 2008, 2008,” “from July 2 to 18, 2008,” “from July 2008, 2008, from among the grounds of the judgment of the court of first instance,” is the same as the corresponding part of the judgment of the court of first instance ( from July 2 to 18, 200). As such, it is cited by Article 8(2) of the Administrative Litigation Act, the main sentence of Article 420 of the Civil Procedure Act.

2. Parts that vary from the judgment of the first instance court;

B. Determination

(1) Relevant legal principles

In light of the economic aspect of taxable income, taxable income is deemed to have a taxable capacity to control and manage income in reality, and it is sufficient to determine that there is a taxable capacity to earn such income, and the legal assessment of the causal relationship with which the income was derived is lawful and effective. Thus, even if illegal income is generated by criminal act, it constitutes taxable income unless a measure to return is taken to the person to whom it belongs (see, e.g., Supreme Court Decision 81Nu136, Oct. 25, 1983); and Article 21(1)23 of the Income Tax Act, which was amended and enforced by Act No. 7528, May 31, 2005, explicitly stipulates that "bral water" corresponding to illegal income, shall be included in other income.

Therefore, as long as a taxpayer does not return to the original owner after receiving money from a criminal act, income subject to taxation under the Income Tax Act has already been realized, and even if the collection of money from a criminal case against a taxpayer became final and conclusive and all of the money was collected to the State, it is merely an additional penalty for a criminal act subject to criminal punishment, and thus, it cannot be said that a taxpayer has not realized income equivalent to that received from a criminal act (see Supreme Court Decision 2002Du431, May 10, 2002, etc.).

(2) Determination

According to the Plaintiff’s statement and the purport of oral argument as to Gap evidence No. 5, it is acknowledged that the Plaintiff paid KRW 88 million to the State on February 16, 201 in accordance with the judgment of this case ordering the Plaintiff to collect a bribe of KRW 88 million. However, since the Plaintiff’s above bribe acceptance act constitutes a criminal act subject to criminal punishment, it is merely a result of additional punishment for such criminal act, and the above additional imposition payment cannot be deemed unlawful merely on the ground that the above additional imposition cannot be seen as unlawful, as long as the Plaintiff’s above additional imposition cannot be seen as being identical to the return of the original person to the above bribe of KRW 80,000,000,000,000,000,0000,000 won which were offered to the Plaintiff, which was 0,000 won prior to the lapse of this case’s imposition of KRW 80,000,000,000,000,000,000.

3. Conclusion

Thus, the plaintiff's claim of this case is dismissed as it is without merit, and the judgment of the court of first instance is just as above. Thus, the plaintiff's appeal of this case is dismissed.

Judges Kim Dong-ok (Presiding Judge) Gyeong-gu