The case affirming the judgment of the court below that the disposition imposing value-added tax on a taxpayer was made based on an illegal tax investigation conducted in duplicate for the same tax items as the previous correction investigation of value-added tax and for the

Article 81-3 of the former Framework Act on National Taxes (amended by Act No. 6782 of Dec. 18, 2002)

Plaintiff (Law Firm Rate, Attorneys Hy Chang-soo et al., Counsel for the plaintiff-appellant)

The director of the Southern Incheon District Office

Seoul High Court Decision 2003Nu10826 delivered on September 24, 2004

The appeal is dismissed. The costs of appeal are assessed against the defendant.

Based on the evidence of employment, the court below found the following facts: on November 1, 1998, the defendant made a tax investigation as to whether value-added tax was omitted in relation to the plaintiff's real estate rental business, found that the lease income was partially omitted, and made a disposition to revise the value-added tax around December of the same year according to the result of the tax investigation; however, on November 1, 1999, the head of Seoul Regional Tax Office investigated whether the lease income was omitted for the taxable period in which the tax investigation was already conducted under the name of conducting a special tax investigation as to the whole of the plaintiff's personal tax; and the defendant made a disposition to revise the value-added tax in this case based on the results of the tax investigation, and determined that the disposition to impose the value-added tax in this case was unlawful since it was based on the illegal duplicate investigation conducted by the director of the Seoul Regional Tax Office that conducted the same tax item as the tax investigation (value-added tax investigation) around November 199

Examining the reasoning of the judgment of the court below in light of the records and relevant Acts and subordinate statutes, this recognition and judgment of the court below is justified, and there is no error of law by misunderstanding the legal principles as to mistake of facts or duplicate investigation as otherwise

Furthermore, even based on all the materials indicated in the record, the Seoul Regional Tax Office’s investigation of this case was conducted on the basis of evident evidence that there was a suspicion of evading value-added tax, or was found to have been erroneous in relation to the two or more business years, and thus, it cannot be recognized that the first defendant’s grounds for appeal cannot be accepted on a different premise.

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition.

Justices Kim Hwang-sik (Presiding Justice)