early 2011 Mine0265 ( October 28, 2011)

Since the entry was omitted and did not verify even if it was shipped, it cannot be recognized as good faith or negligence.

The oil pre-shipment ticket is an important certificate to verify whether or not fake oil exists or not, and the Plaintiff’s receipt of the pre-shipment ticket does not include all the date, time, number, etc. of the shipment, and is written to the effect that only the kind and quantity of oil can only be verified. Thus, even though the source of the oil cannot be known at all, it cannot be recognized as good faith or without fault.

Article 17 (Payable Tax Amount)

2011Guhap2262 Revocation of Disposition of Imposition of Value-Added Tax

XX Kim

Head of the North Mine District Tax Office

November 10, 201

December 8, 2011

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of rectifying the value-added tax of KRW 40,380,360, which was imposed on the Plaintiff on June 8, 2010, shall be revoked.

1. Details of the disposition;

O The plaintiff is a business operator who runs the wholesale and retail business of petroleum in the trade name of 00-4 from September 19, 2003 to 00-4, the 'P Energy' (hereinafter referred to as 'the gas station in this case').

O On June 30, 2009, the Plaintiff received a tax invoice for 289,818,180 (hereinafter “instant tax invoice”) from ○○ Petroleum Industry (hereinafter “○○ Petroleum”) and received a deduction of input tax amount of 87,090,000 won at the time of filing the first value-added tax return in 2009.

O) On June 8, 2010, based on the results of the tax investigation into ○○ Petroleum by the Director of the Regional Tax Office of Gwangju Regional Tax Office, the Defendant issued a notice of correction and correction of KRW 40,952,70 for the first time value-added tax of 2009 on the ground that the instant tax invoice was a false tax invoice by the supplier. On September 13, 2010, the Defendant corrected the non-deductible amount of the input tax and corrected KRW 572,340 for the reduction and correction of KRW 572,340 (hereinafter referred to as the “instant disposition”).

O The Plaintiff dissatisfied with the instant disposition and filed an objection to the Defendant on August 31, 2010. However, the Defendant dismissed it on September 29, 2010. The Plaintiff filed a request for a trial with the Tax Tribunal on December 28, 2010, but the Tax Tribunal dismissed it on March 28, 2011.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 through 2, Eul evidence No. 1 (including various numbers, if any) and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

In light of the fact that the Plaintiff traded with ○○ Petroleum from March 2008 to November 2009 and received tax invoices, specifications of transaction, and shipment slips, etc., and the Defendant also recognized that the remainder except for the portion on June 2009 related to the instant tax invoice among the transaction details in 2009 was a normal transaction, the Plaintiff asserts that the instant disposition is unlawful since ○○ Petroleum, the nominal owner of the instant tax invoice, should be protected as a bona fide trading party who was unaware of such nominal owner, even though it is not a real supplier.

B. Relevant statutes

The entries in the attached Table-related statutes shall be as follows.

(c) Fact of recognition;

(i)The transactions of oil with the plaintiff and ○○ Petroleum

C. From March 2008, the Plaintiff began to conduct oil transactions with ○○ Petroleum Industry located in 100-4, Seo-gu, Seo-gu, Gwangju, Gwangju, and the transaction method was made by receiving and settling tax invoices on the end of the month when oil was put into existence, and the Plaintiff was issued tax invoices from January 2009 to June 2009. On the other hand, the Defendant took the instant tax invoices on the basis of the results of the tax investigation conducted against ○○ Petroleum of the Gwangju Regional Tax Office, deeming only the instant tax invoices on the No. 7, based on the results of the tax investigation conducted against ○○ Petroleum of the Gwangju Regional Tax Office, as a false tax invoice, and deducted the purchase tax amount, and issued the instant disposition against the Plaintiff.

[The following table omitted]

O The Plaintiff received a tax invoice, detailed statement of transaction, shipment slip, etc. as in the previous transaction at the time of supply of oil listed in the No. 7 of the above table from ○○ Petroleum (hereinafter “instant oil”), and the transaction amount was also paid to the ○○ Petroleum industry. However, although ○○ Petroleum’s driver was delivered with YL or KimNK oil, the instant oil was not the Plaintiff, but the new CH was delivered. The instant oil was delivered to ○○ Petroleum’s daily sales ledger (the details of shipment and distribution) on June 2009.

O On the other hand, the shipment slips issued by the Plaintiff from ○ Petroleum do not include the type and quantity of oil, the date and quantity of shipment, the shipment number, etc.

2) Conduct tax investigation of the Gwangju Regional Tax Office and its result

As a result of the Gwangju Regional Tax Office’s tax investigation on ○○ Petroleum from July 9, 2009 to November 26, 2009, 92.3% of the total purchase declaration amount from May 1, 2006 to September 30, 2009, the opening date of the business, and 35.7% of the total sales declaration amount, respectively, were confirmed as false (processed or disguised) sales, in collusion with the oil-free business operators and third parties, and then issued a large quantity of false tax invoices and then did not pay the output tax amount. The head of the Gwangju Regional Tax Office filed an accusation against the actual representative and related persons to Busan District Tax Office under the suspicion of violating the Punishment of Tax Evaders Act, etc.

(iii) a statement of the persons concerned;

The main contents of the Gwangju Regional Tax Office stated by relevant persons in the course of the above tax investigation for ○○ Petroleum are as follows:

A) Plaintiff

O In the introduction of a third party, ○○ Petroleum's ○○ K, a member of the ○○ Petroleum's business, was found to find out the unit price for light oil and supplied 20 won at a container than static oil. From March 2008, ○ Petroleum's head office was found to be in light of light.

Pursuant to the investigator’s question whether prior to trading with ○○ Petroleum, the location of the place of business and the personal information of the representative, etc. was confirmed, prior to trading with ○○ Petroleum, the investigator asked whether the former corporation is a legal entity or the representative of the latter. At that time, the employees engaged in trading with ○○ Petroleum without doubt on the fact that the latter has a storage tank even in Gwangju Newdong, while the latter has a storage tank.

O With respect to the oil of this case, which is a new CH who is not a transport engineer of ○ petroleum, the instant oil was supplied to new CH at the time of being supplied with ○○ Petroleum. As such, it was an article working at the headquarters of ○○ Petroleum located in luminous, and the said quantity was not superior to ○○ Petroleum headquarters. As such, the instant oil was known to ○○ Petroleum’s oil and received without doubt.

B) Song JS ( Department of ○○ Petroleum)

The Plaintiff and ○○ Petroleum have been involved in the purchase of free oil as an employee of ○○ Petroleum’s business, and the oil supplied by SSH to the Plaintiff is an oil which was purchased and released as free materials from △△ oil, not ○○ Petroleum.

C) ShipBK (○ Petroleum Business Operator)

Since the operator of oil sold by ○○ Petroleum is Kim NK and EYL, it is also deemed that the entire ○○ Petroleum is not a oil delivered by the entire ○○ Petroleum except the shipment slips as set out in Kim NK and Lee YL.

D. Determination

1) Whether the instant tax invoice constitutes a false tax invoice

(A) The meaning that the entries in the tax invoice under the Value-Added Tax Act are different from the facts refers to cases where the necessary entries in the tax invoice do not coincide with the actual subjects, values, and timing of the supply or supply of the goods or services.

(B) However, as a result of the investigation of the Gwangju Regional Tax Office on ○○ Petroleum, the Plaintiff issued a large number of false tax invoices in collusion with the oil-free petroleum distributors and with a third party, and then did not pay the output tax amount. Unlike the previous transaction, the instant oil was delivered by Kim NK, an operator of ○○ Petroleum, and by new CH rather than YL. The Plaintiff stated that the new CH was not an operator of ○○ Petroleum, and that the oil delivered to the Plaintiff by ○○ Petroleum was purchased and shipped out as non-free materials from △△△ Petroleum oil, not ○○ Petroleum, and that the Plaintiff stated that the oil was delivered to the Plaintiff. As such, it is reasonable to deem that the instant oil was supplied in △△△ Petroleum, not the instant ○○ Petroleum, and thus, it constitutes a false tax invoice by the Plaintiff.

2) Whether the Plaintiff is a trading party acting in good faith

(A) Unless there are special circumstances, the actual supplier and the supplier on a tax invoice may not deduct or refund the input tax amount unless there is any negligence on the part of the supplier that he/she was unaware of the name of the tax invoice and that there was no negligence on the part of the supplier on the part of his/her unaware of the name of the tax invoice (see, e.g., Supreme Court Decision 2009Du1808, Jun. 11, 2009).

(B) In light of the above legal principles, the Plaintiff received transaction specifications, purchase tax invoices, and shipment slips at the time of being supplied with the instant oil, and remitted the transaction price to the bank account of ○○ Petroleum. The remainder of the oil purchased from ○○ Petroleum during the first period of 2009, except the instant oil, among the oil purchased from ○○ Petroleum, appears to be normally transacted.

However, comprehensively taking account of the following circumstances revealed by the facts acknowledged as above and the purport of the entire argument, it is insufficient to acknowledge that the Plaintiff was not aware that ○○ Petroleum, the nominal owner of the instant tax invoice, was not the supplier of the instant oil, and that there was no negligence on the part of the Plaintiff, and there is no other evidence to acknowledge otherwise.

① Since 2003, the Plaintiff, a business operator operating the instant gas station, had been able to fully know the normal structure and distribution route of the supply of oil, the general form and method of trading in the oil industry, and the actual state and risk of transactions in data widely spreaded in the oil industry. Moreover, since the intermediate wholesale market is being distributed, it is not easy to supply oil at a price lower than the oil station. As such, the Plaintiff, who was supplied via 20 won or a unit price lower than ○○ Petroleum, needs to pay special attention to whether ○○ Petroleum is the actual supplier of the oil.

② However, from March 2008, the Plaintiff neglected the procedures for verifying ○○ Petroleum, a party to the instant oil, such as the Plaintiff’s receipt of the instant oil via ○○ Petroleum, and the Plaintiff did not receive the business registration certificate, the register of corporate register, and the certificate of registration for petroleum sales.

③ The oil pre-shipment ticket is an important certificate to verify whether or not fake oil exists and non-data oil. The pre-shipment ticket issued by ○○ Petroleum does not include all the basic matters of the pre-shipment ticket, the date and time of shipment, the number of shipment, etc., and only the kind and quantity of oil can be entered. Thus, even though the source of oil cannot be known at all, the Plaintiff traded without any particular confirmation or doubt.

④ In particular, unlike before being supplied with the instant oil, a new CH, who was not an operator of ○ Petroleum, transported the oil at the time of delivery, and the Plaintiff was aware of such fact. As such, the Plaintiff appears to have been sufficiently required to contact ○○ Petroleum with the new CH as to whether the new CH was an operator of ○ Petroleum, and the source of the instant oil, but did not take any particular measure other than by asking personal information, etc. to the new CH.

3) Sub-decisions

Therefore, the instant tax invoice constitutes a tax invoice entered falsely by a supplier, and the Plaintiff’s good faith and without fault is not acknowledged. Thus, the Defendant’s disposition that corrected and imposed value-added tax for the first time in 2009 with the intention to not deduct the input tax amount on the instant tax invoice is lawful, and the Plaintiff’s assertion disputing this is without merit.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.