[1] Criteria to apply the principle of good faith to the contradictory behavior of a taxpayer in a tax lawsuit

[2] The case holding that it does not go against the principle of trust and good faith or tax justice to claim the title trust only when the corporation reported and paid the corporate tax, etc. on the real estate held in title trust, and the corporate tax was imposed on the disposal profit after the disposal of real estate

[1] Article 15 of the Framework Act on National Taxes / [2] Article 15 of the Framework Act on National Taxes

[1] Supreme Court en banc Decision 95Nu18383 delivered on March 20, 1997 (Gong1997Sang, 1005) Supreme Court Decision 2000Du2952 delivered on June 15, 2001 (Gong2001Ha, 1646) Supreme Court Decision 2003Du3468 delivered on May 14, 2004 (Gong2004Sang, 109)

Chang Changsung Co., Ltd. (Attorney Han Chang-dong, Counsel for the plaintiff-appellant)

Head of the Do Tax Office

Seoul High Court Decision 2004Nu4927 delivered on January 14, 2005

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

The grounds of appeal are examined.

1. As to ground of appeal No. 1

In light of the records, the judgment of the court of first instance, as cited by the court below, acknowledged the facts of the judgment by comprehensively taking account of the adopted evidence, and the fact that some of the lessees of the real estate of this case (hereinafter referred to as the "merchants of this case") purchased the real estate of this case, and registered the ownership transfer under the name of the plaintiff because of the legal limitation not to own a certain ratio of business property or not to open the market. The possession, disposal, etc. of the real estate of this case was made at will by the merchants of this case regardless of the plaintiff. The real estate acquisition funds managed by shareholders, officers and short-term loans of this case were not paid interest to the merchants of this case or repaid principal, and there was no little amount in calculating the depreciation costs of the real estate of this case, and other circumstances revealed in the oral argument, the real estate of this case was under title trust to the plaintiff, which was inevitable to establish the permanent market as the substantial co-ownership of the merchants of this case, and thus, the disposition of this case was unlawful, and there is no violation of the rules of evidence as alleged in the grounds for appeal.

2. As to ground of appeal No. 2

The application of the principle of trust and good faith to the tax law that strongly acts on the basis of the principle of legality under the principle of no taxation without law is limited to cases where it is deemed necessary to protect specific trust even if the person liable for tax payment sacrifices the principle of legality. In particular, if the person liable for tax payment commits an act contrary to his past speech and behavior against the tax authority, it shall be subject to a disadvantageous disposition, such as deprivation of benefits such as tax reduction and exemption under tax law, various additional taxes, penalty under tax law, etc., and the tax authority shall have the right of on-site investigation in the superior position to the taxpayer, and the burden of proof of legality of the tax disposition is in principle against the tax authority, the application of the principle of trust and good faith to the taxpayer shall be extremely limited and shall not be expanded and interpreted (see Supreme Court Decision 95Nu18383, Mar. 20, 1997, etc.). In addition, the person liable for tax payment has objectively contradictory behavior in order to apply the principle of trust and good faith to the taxpayer.

In light of the above legal principles and records, the court below is justified in holding that the court below did not err in the misapprehension of the legal principles as to the principle of trust and good faith, and there is no error in the misapprehension of the legal principles as to the principle of trust and good faith, as otherwise alleged in the ground of appeal.

3. Conclusion

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

Justices Ahn Dai-hee (Presiding Justice)