Korea Hebap Co., Ltd. (Attorney Ba-sik et al., Counsel for defendant-appellant)

The Director of Gangnam District Office

Seoul Regional Tax Office

August 17, 2012

Seoul Administrative Court Decision 2010Guhap39663 Decided October 20, 2011

1.The part of the judgment of the court of first instance against the defendant Gangnam-gu chief of the tax office, including the claims expanded by this court, shall be modified as follows:

“A. The imposition of corporate tax of KRW 2,239,34,460 on March 28, 2007 against the Plaintiff by the head of Gangnam District Tax Office exceeds KRW 1,404,233,560 on the disposition of KRW 1,40 on the imposition of corporate tax of KRW 2,404,233,560 on the business year of March 28, 2007 and the imposition of KRW 286,17,180 on the disposition of KRW 538,947, and 207 on May 10, 2007 shall be revoked.

B. The plaintiff's remaining claims against the defendant Gangnam-gu director of the tax office are dismissed.

2. The plaintiff's appeal against the director of the Seoul Regional Tax Office and the appeal against the director of the Seoul Regional Tax Office are dismissed.

3. 3/5 of the total litigation costs incurred between the plaintiff and the defendant Gangnam-gu Head of the tax office shall be borne by the plaintiff, and the remainder by the director of the tax office of Gangnam-gu, respectively, and the appeal costs incurred between the plaintiff and the defendant

4. Attached Table 1 of the judgment of the first instance court: The “1,374,490,511 won” in the column of income amount in attached Table 2 shall be corrected to “1,373,820,332 won”.

1. Purport of claim

The disposition of imposition of corporate tax of KRW 2,239,344,460 on March 28, 2007 against the Plaintiff by the head of Gangnam District Tax Office, and the disposition of imposition of KRW 538,947,180 on May 10, 2007, and the disposition of imposition of KRW 538,947,180 on March 29, 2007 by the head of the Seoul Regional Tax Office, Section 1 on May 7, 2007, and Section 2 on August 10, 2007, which was made against the Plaintiff by the head of the Gangnam District Tax Office against the Plaintiff, shall be revoked (the Plaintiff extended part of the purport of the claim as above and reduced partly).

2. Purport of appeal

A. The plaintiff

Of the judgment of the first instance court, the part against the plaintiff shall be revoked. On March 29, 2007 and May 7, 2007, the head of the Seoul Regional Tax Office shall revoke the disposition of notification of change in the amount of income stated in the attached Table 1

B. Defendant Gangnam-gu director of the tax office

The part of the judgment of the court of first instance concerning the defendant Gangnam Tax Office shall be revoked. The plaintiff's claim against the defendant Gangnam Tax Office shall be dismissed.

C. Defendant Director of Seoul Regional Tax Office

In the judgment of the court of first instance, the part against the defendant director of Seoul Regional Tax Office shall be revoked, and the plaintiff's claim corresponding to the revocation

1. Quotation of judgment of the first instance;

The reasoning of this court's decision is the same as the reasoning of the judgment of the court of first instance except for dismissal as follows. Thus, this court's decision is acceptable in accordance with Article 8 (2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act.

Part 3, 00 "6,748,624,00 won" in Part 5 of Part 3 is "6,748,624,086 won", " May 10, 2007," "201, 2002, 2004" in Part 17 of the same part is "201, 2004" and "HIA" in Part 11 of the same part is "HIAI."

○ The mark on the fourth page shall be as follows:

2,239,34,84,830 won 2,204 90,830 won 2,239,344,830 won 2,460 won 39,63,230 won 412,220,520,520 won 538,947,180 won 2,490 won 2,239,344,460 won 204,830 won 39,63,230 won 412,220,520 won 538,947,180 won

○ Paragraph 5 of the judgment of the first instance court is as follows.

5. Scope of revocation of the instant disposition

In a litigation for revocation of a taxation disposition, whether a disposition is lawful or not shall be determined depending on whether it exceeds a legitimate tax amount, and the parties may submit arguments and materials supporting the objective tax liability amount until the closing of arguments in the fact-finding court. When calculating the legitimate tax amount to be imposed lawfully based on such materials, only the portion exceeding the legitimate tax amount shall be revoked, and the entire tax amount shall not be revoked (see Supreme Court Decision 99Du8930, Jun. 12, 2001, etc.).

In light of the above legal principles, the portion of corporate tax assessment for the business year 2001, 2004 due to the transfer price adjustment among the dispositions of this case is illegal as seen earlier. As such, the tax base and tax amount calculated on the premise that the transfer price adjustment of this case was lawful, and the portion of corporate tax assessment for the business year 2001, 2004 due to the transfer price adjustment of this case was unlawful. Meanwhile, according to the allegations and submitted materials by the parties until the closing of argument of the court of this case, the reasonable tax amount can be calculated on the premise that the portion of corporate tax assessment for the business year 2001, 2004 due to the transfer price adjustment of this case is illegal. Thus, there is no dispute between the parties as to the fact that the portion of corporate tax assessment for the business year 2001, 2004 due to the transfer price adjustment of this case is unlawful (i.e., the tax amount to be revoked) as indicated below.

2,239,34,460 won 835,110,90 won 1,404,233,560 won 538,947,180 won 252,773,90 won 286,173,90 won 286,173,190 won 200

In light of the aforementioned circumstances, the portion of corporate tax imposed for the business year 2001 and 2004 of the instant disposition is lawful within the scope of the pertinent political party’s tax amount, and the portion in excess thereof is unlawful. Therefore, the portion exceeding KRW 1,404,23,560 of the tax amount imposed for the Plaintiff on March 28, 2007 by the head of Gangnam-gu Tax Office in the disposition of KRW 2,239,34,460 of the corporate tax for the business year 2001, and the portion exceeding KRW 538,947,180 of the corporate tax for the business year 204, and the portion exceeding KRW 286,173,190 of the tax amount imposed for the business year 204 of May 10, 207 should be revoked, as unlawful.”

2. Conclusion

If so, the plaintiff's claim against the defendant Gangnam Tax Office is accepted within the scope of the above recognition, and the remaining claims are dismissed due to the lack of reason. Of the judgment of the court of Gangnam Tax Office, the part concerning the defendant Gangnam Tax Office in the judgment of the court of Gangnam is inappropriate differently from this conclusion. The part concerning the defendant Gangnam Tax Office in the judgment of the court of Gangnam Tax Office is partially accepted and the part concerning the defendant Gangnam Tax Office in the judgment of the court of Gangnam Tax Office in the judgment of the court of the first instance, including the claim extended by the court of this court, shall be modified as stated in subparagraph 1-A and (b) of the disposition. Meanwhile, the plaintiff's appeal against the defendant Gangnam Tax Office and the appeal by the head of the Seoul District Tax Office in the judgment of the court of Seoul District Tax Office, are all dismissed without any reason, while the "1,374,490,5

[Attachment]

Judges Kim Jong-chul (Presiding Judge)

1) On March 29, 2007, the Plaintiff stated “256,493 won” in the “income column of notification of change in the income amount on March 29, 2007 attached to the Plaintiff’s complaint and reduced it in this court.

Note 2) The Plaintiff written “HII” in the “income earner column of the notice of change in the income amount on May 7, 2007 of attached Table 1 of the attached Table 1 to the Plaintiff attached to the Plaintiff’s complaint, but it is reasonable to deem that the “HII” written in the notice of change in the income amount on May 7, 2007, as cited below, appears to be a clerical error or error of the “HIAI,” and that the Plaintiff could have sufficiently known such circumstances. As such, attached Table 1 of attached Table 1 of the attached Table 1 to be attached to the instant ruling, the income earner of the notice of change in the income amount on May 7, 2007 in the “HII” instead of the “H II.”