Cho Jae-2016-China-3781 ( December 15, 2016)

It is deemed to be a disguised transaction because the normal place of business of the purchaser is not verified.

A false transaction is deemed to be a disguised transaction because the purchaser who operates under the name of the borrower is not verified in a normal place of business to operate the scrap metal wholesale business.

Article 16 of the Value-Added Tax Act

2017Guhap62908 Disposition of Disposition of Imposing Value-Added Tax, etc.

○ Kim

○ Head of tax office

July 18, 2017

August 22, 2017

1. All of the plaintiff's claims are dismissed.

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

Cheong-gu Office

The Defendant’s imposition of value-added tax of KRW 7,275,980 (including additional tax) and value-added tax of KRW 2,451,440 (including additional tax) for 2011 against the Plaintiff on July 11, 2016 shall be revoked in all.

1. Details of the disposition;

A. On April 1, 1990, the Plaintiff is an individual entrepreneur who runs a wholesale and retail business of public bottles and non-ferrous metals after completing business registration with the trade name "AM".

B. Upon filing a value-added tax return with the Defendant, the Plaintiff declared that, on September 27, 201, the purchase amount of the second-term purchase amount of the year 201 was KRW 45,885,00, and the first-term purchase amount of the year 201 was deducted from the input tax amount (hereinafter “instant input tax amount”) on the grounds of the tax invoice (the supply price of KRW 12,021,00), the tax invoice (the supply price of KRW 12,021,00), February 29, 2012, and the tax invoice (the supply price of KRW 3,990,00) of March 5, 2012 (hereinafter “each of the instant tax invoices”) issued by the Plaintiff, the Plaintiff declared that the purchase amount of the first-term purchase amount of the year 2012 was KRW 16,01,000.

C. From July 14, 2014 to August 24, 2014, the head of the ○○ Tax Office conducted a tax investigation on the milk sales business operator who completed the registration of the scrap metal wholesale and retail business operator, and confirmed that there was no space where ○○○○, ○○, 695 dong-dong-dong-dong-dong-dong-based ○○○, ○○○, ○○○, ○○, ○○○, ○○, etc. was installed, and notified that the transaction of each of the instant tax invoices by the Plaintiff, one of the business operators that issued the relevant tax invoice, is doubtful as a processing transaction.

D. Accordingly, on July 11, 2016, the Defendant issued a revised and notified the Plaintiff of the value-added tax of KRW 7,275,980 (additional tax of KRW 2,687,484) in 201 and the value-added tax of KRW 2,451,440 (the amount obtained by deducting the already paid tax amount of KRW 42,46,367 from the sum of KRW 38,487,05 and the additional tax of KRW 6,410,758) in 201 (hereinafter “each of the instant dispositions”).

E. The Plaintiff sought revocation of each of the dispositions of this case and requested an inquiry to the Tax Tribunal, but the Tax Tribunal rendered a decision to dismiss the Plaintiff’s request on December 15, 2016.

[Reasons for Recognition] Evidence Nos. 1, 2, and 5 (including branch numbers; hereinafter the same shall apply), Evidence Nos. 1, 2, and 2, and the purport of the whole pleadings

2. Whether each of the dispositions of this case is legitimate

A. The plaintiff's assertion

The Plaintiff, an operator of ○○ Non-Iron, was aware of Y and 10 years ago, and was issued each of the instant tax invoices in the course of actual scrap metal transactions after checking his place of business. As such, each of the instant dispositions made by the Defendant on the ground that each of the instant tax invoices is a processed tax invoice is unlawful.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

In full view of the following circumstances, each of the instant tax invoices issued under Article 17(2)2 of the former Value-Added Tax Act (amended by Act No. 11608, Jan. 1, 2013) constitutes “where a necessary entry of a tax invoice is entered differently from the fact” and thus, the relevant input tax amount cannot be deducted.

① UN, which is registered as the representative of ○○ Non-Iron, has no record of engaging in scrap metal wholesale and retail business, and the name of each supplier of each tax invoice of this case is written differently from the fact, since Y is an actual business operator of ○○ Non-Iron.

② Around July 2014, the head of ○○ Tax Office conducted a tax investigation on ○○○○○○○○○ 695 dong, the place of business of ○○ non-Iron, confirmed that there was no space for installation of open-site and relayrs, etc. to run the wholesale and retail business, and that there was no rent of the said building to the lessor or other scrap metal, non-refrat, and that there was no material to know the actual place of business. ○○ Y, the actual operator of ○○ non-Iron, appears to have actually been operating the wholesale business, such as scrap metal, at the place of business.

③ With respect to each of the tax invoices of this case on September 27, 2011 (the supply price of KRW 45,885,00, the tax amount of KRW 45,58,500, the aggregate of KRW 50,473,500, the tax amount of KRW 50,000) was confirmed, YY contacted the Plaintiff on September 27, 2011, and confirmed that the Plaintiff was ○○○○○○○○○, 175, 175, with the gross weight of KRW 14,00,00, and the truck was issued from ○○○○○○○, which had a photo, and then, it is difficult to recognize that the Plaintiff and ○○○○○○, a direct transaction with the Plaintiff, was 50,473,500,00. According to such recognition, it is difficult to view that the Plaintiff and ○○○, a direct transaction with the Plaintiff on the same day.

④ In the case of the remaining tax invoices, excluding the tax invoices dated September 27, 2011, each of the instant tax invoices, it is difficult to deem that such transaction was actually made on the grounds that there was no objective data to identify the unit price or supply quantity of non-ferrous metals, which served as the basis for calculating the value of supply.

Therefore, the plaintiff's assertion is without merit.

3. Conclusion

Therefore, each of the claims of the plaintiff in this case is dismissed as it is without merit, and it is so decided as per Disposition.

Relevant statutes

former Value-Added Tax Act (Amended by Act No. 11608, Jan. 1, 2013)

Article 16 (Tax Invoice)

① 납세의무자로 등록한 사업자가 재화 또는 용역을 공급하는 경우에는 제9조의 시기(대통령령에서 시기를 다르게 정하는 경우에는 그 시기를 말한다)에 다음 각 호의 사항을 적은 계산서(이하 세금계산서 라 한다)를 대통령령으로 정하는 바에 따라 공급을 받은 자에게 발급하여야 한다. 이 경우 세금계산서를 발급한 후 그 기재사항에 관하여 착오나 정정(����) 등 대통령령으로 정하는 사유가 발생한 경우에는 대통령령으로 정하는 바에 따라 세금계산서를 수정하여 발급할 수 있다.

1. Registration number, name or denomination of the businessman who provides;

2. Registration number of the person who receives;

3. Supply value and value-added tax;

4. Date of preparation;

5. Matters prescribed by Presidential Decree, other than those under subparagraphs 1 through 4.

Article 17 (Payable Tax Amount)

(1) The amount of value-added taxes payable by an entrepreneur (hereinafter referred to as the "paid tax amount") shall be the amount computed by deducting the tax amount under the following subparagraphs (hereinafter referred to as the "in-house tax amount") from the tax amount on the goods and services supplied by him/her (hereinafter referred to as the "the output tax amount"): Provided, That in cases of an input tax amount exceeding

1. The tax amount for the supply of goods or services used or to be used for his own business;

2. The tax amount for the import of goods used or to be used for his own business; and

(2) The following input taxes shall not be deducted from the output tax amount:

1. An input tax amount where the list of total tax invoices by customer is not submitted under Article 20 (1) and (2), or the input tax amount on the portion not entered or the portion entered differently from the fact, where the whole or part of the registration numbers or supply values by transaction parties is not entered or differently entered from the fact, from among the entries on the list of total tax invoices by customer submitted: Provided, That in such cases as prescribed by Presidential Decree,

2. An input tax amount, in cases where a tax invoice under Article 16 (1), (2), (4) and (5) is not issued, or all or part of the matters to be entered under Article 16 (1) 1 through 4 (hereinafter referred to as "necessary matters to be entered") are not entered or entered differently from the fact on the issued tax invoice: Provided, That the input tax amount in cases prescribed by Presidential Decree shall be excluded;