(a) Validity of a return for reduction or correction under Article 45 of the Framework Act on National Taxes;

(b) Whether a taxpayer can seek the return of the already paid tax amount in a civil procedure, corresponding to the difference between the initially reported tax amount and the reported tax amount by a person having a right to taxation refuses the reduction of the tax amount following a revised return;

A. In the case of corporate tax taking the method of tax payment, when the taxpayer returns the tax base and the amount of tax payable to the government, the tax liability becomes final and conclusive, and when the taxpayer finds any omission or error in the tax base or the amount of tax initially declared, the taxpayer may file an amended return for the reduction of the tax base or the amount of tax payable within six months after the statutory due date of return expires, as prescribed by Article 45(1)1 and (2) of the Framework Act on National Taxes. In such a case, the revised return does not immediately cause a change in the tax liability due to the initial return, but it does not result in a change in the tax liability due to the revised return. The tax liability becomes final and conclusive only when the government makes a decision for the reduction of the tax base or the amount of tax payable upon receiving the revised return. If the government refuses such revised return, the taxpayer can only determine the tax liability due to the revised

B. If a taxpayer of corporate tax returns the tax base and the amount of tax to be paid, and thereafter, files a revised return on the grounds that the tax base and the amount of tax are excessive, and the taxpayer refuses to reduce the tax base and the amount of tax to be paid by the return of tax base and the amount of tax to be paid, the original return of domestic affairs is wrong, and the rejection of correction following the revised return is illegal. However, unless the disposition to refuse the correction was legally cancelled by an administrative litigation or the original return of the portion is null and void as a matter of course, the taxpayer cannot claim a refund in a civil lawsuit, in accordance with the legal principles for return of unjust enrichment, by asserting that the already returned portion and the amount of tax to be paid, which are equivalent to the difference between the original return portion and the reported portion,

a.B.Article 45(1)1 and Article 45(2) of the Framework Act on National Taxes, Article 26(a) of the Corporate Tax Act, Article 42(1)2 of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4666 of Dec. 31, 1993). Article 741 of the Civil Act

A.B. Supreme Court Decision 85Nu883 delivered on January 31, 1989 (Gong1989,353). Supreme Court Decision 91Nu13 delivered on April 28, 1992 (Gong192,1766)

Seojin Metal Co., Ltd., Counsel for the defendant-appellant and one other

Korea

Seoul High Court Decision 93Na4184 delivered on September 24, 1993

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

We examine the grounds of appeal.

1. According to the reasoning of the judgment below, when the plaintiff transferred the site and the old factory building of this case on December 15, 1989 and reported corporate tax for the business year 1990 after receiving the transfer proceeds around February 1, 1991, the court below recognized that the tax exemption provision of the above land and others is not applicable to corporate tax on income equivalent to the transfer marginal profit of the above land, and filed a final return of the tax base for the corporate tax without deducting the exempted tax amount, and determined that the plaintiff had an obligation to legally exempt the transfer income tax under the above Act by filing an application for exemption from corporate tax on May 15, 1989 on the ground that the above transfer income is subject to corporate tax exemption under the above provision of the above Act, and thus, the plaintiff did not know that the tax exemption provision should be applied for exemption from corporate tax on the grounds that the above tax amount should be refunded to the plaintiff. Thus, the court below recognized that the plaintiff had an obligation of exemption from corporate tax on the revised return of the tax base of this case.

2. In the case of corporate tax taking the so-called method of tax payment, when a taxpayer returns the tax base and the amount of tax to the government, the tax liability becomes final and conclusive, and when a taxpayer finds any omission or error in the tax base or the amount of tax initially declared, the taxpayer may file a return for the reduction of the tax base or the amount of tax to be paid within six months after the statutory due date of return expires, as prescribed by Article 45(1)1 and (2) of the Framework Act on National Taxes. In this case, the revised return does not immediately cause a change in the tax liability due to the initial return, but the tax liability becomes final and conclusive only when the government decides the tax base or the amount of tax to be paid after receiving the revised return. If the government refuses the correction following such revised return, the taxpayer can only confirm the tax liability due to the revised return after revoking the disposition of refusal in accordance with the procedure of administrative litigation (see, e.g., Supreme Court Decision 85Nu83, Jan. 31, 1989; Supreme Court Decision 8Nu1313131, Apr. 28, 1992).

Therefore, even though a taxpayer of corporate tax filed a return of tax base and payable tax amount and filed a return of revised tax return on the grounds that the tax base and tax amount of the above return are excessive, if the taxpayer refuses to reduce the tax base and tax amount on the grounds that the return of revised tax base and tax amount are accepted, the original return of domestic affairs is wrong, and the rejection of correction following the revised return is illegal. However, the taxpayer cannot claim a refund of the tax amount in a civil lawsuit, in accordance with the legal principles for return of unjust enrichment, because the taxpayer asserts that the tax amount already received the difference between the original return and the reported return of corrected tax amount without any legal ground, unless the disposition of refusal of correction was legally cancelled by an administrative litigation or the original return of the portion is null and void per annum.

3. On the other hand, the court below also recognized that the plaintiff filed an application for tax exemption and filed a revised return seeking tax exemption on the ground that the above capital gains would be subject to corporate tax exemption after paying a sum of 121,761,460 won as part of the corporate tax base return on the capital gains of this case along with the final return of tax base of the corresponding return. However, according to records, the tax authority rejected correction following the above revised return on the ground that the tax authority cannot receive benefits from the tax exemption if it filed an application for tax exemption after filing a revised return of corporate tax. Rather, it notified the plaintiff that the plaintiff should additionally pay the amount of KRW 79,737,60 which is included in the amount of the initial returned corporate tax, which was added to the amount of the unpaid corporate tax, and the plaintiff filed an administrative lawsuit claiming revocation of the disposition imposing the above additional corporate tax due to objection, and therefore, it can be seen that the lawsuit was still pending in the court at the time the argument of this case was closed.

In the same sense, even if the taxation authority is illegal to accept the Plaintiff’s above revised return, the Plaintiff’s claim for refund of the amount of tax paid according to the original return cannot be allowed without waiting for the cancellation confirmation of the disposition rejecting the correction following the revised return of the taxation authority according to the result of the above administrative litigation.

Nevertheless, the lower court determined that the Defendant is liable to refund the tax amount already paid on the premise that the effect of the tax liability due to the initial return was extinguished solely on the ground that the Plaintiff filed a revised return, deeming that the tax amount due to the return constituted an erroneous or erroneous payment made without any legal cause. In so doing, it cannot be said that there was an error of law regarding the application of each interpretation of the Framework Act on National Taxes and the Regulation of Tax Reduction and Exemption Act on the validity of refund of overpaid or erroneously paid tax and the application for exemption from the amount of tax due.

4. Therefore, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Park Jong-chul (Presiding Justice)