[1] Criteria for determining whether a certain act of an administrative agency is subject to appeal

[2] Whether a decision on tax investigation constitutes an administrative disposition subject to appeal litigation (affirmative)

[1] The issue of whether a certain act of an administrative agency can be a subject of an appeal cannot be determined abstractly and generally. In specific cases, an administrative disposition is an enforcement of law with regard to specific facts conducted by an administrative agency as a public authority, which directly affects the rights and obligations of the people. The decision should be made individually by taking into account the content and purport of the relevant Act and subordinate statutes, the subject, content, form, and procedure of the act, the actual relation between the act and disadvantage suffered by the interested parties such as the other party, and the principle of administration by the rule of law, the attitude of the administrative agency and interested parties related

[2] In a case where the tax authority's authority to inquire and investigate tax authorities for a disposition is made, a taxpayer shall be legally obligated to answer questions for tax officials to collect tax data and to allow them to inspect them. A tax investigation should be conducted to the minimum extent necessary for appropriate and fair taxation. Moreover, re-investigation of the same tax item and taxable period should be prohibited not only seriously infringe taxpayers' rights and interests, such as taxpayers' freedom of business operation, but also the risk of arbitrary tax investigation by the tax authorities. Thus, there is a need to be prohibited except in exceptional cases where it is considerably contrary to the principle of fair taxation. Considering the above, a tax investigation decision can be resolved at an early stage by dispute over an individual disposition of fine for negligence rather than allowing the taxpayer to appeal only for taxation after the completion of the investigation. A tax investigation decision is an administrative action by the exercise of public authority that directly affects the rights and duties of a taxpayer and is subject to appeal litigation.

[1] Article 2(1)1 of the Administrative Litigation Act / [2] Articles 81-4(1) and 81-7(1) of the former Framework Act on National Taxes (Amended by Act No. 911, Jan. 1, 2010); Article 170 of the Income Tax Act; Article 122 of the Corporate Tax Act; Article 35 of the Value-Added Tax Act; Article 17 subparag. 5 of the Punishment of Tax Evaders Act; Article 2(1)1 of the Administrative Litigation Act

[1] Supreme Court Decision 91Nu1714 Decided January 17, 1992 (Gong1992, 916) Supreme Court en banc Decision 2005Du4397 Decided June 14, 2007 (Gong2010Ha, 2279) Decided November 18, 2010 / [2] Supreme Court Decision 2008Du10461 Decided December 23, 2010 (Gong201Sang, 250)

Plaintiff

Daejeon Head of the District Tax Office

Daejeon High Court Decision 2009Nu124, 131 Decided November 26, 2009

The part of the judgment of the court below against the plaintiff shall be reversed, and that part of the case shall be remanded to the Daejeon High Court.

The grounds of appeal are examined.

1. The issue of whether a certain act of an administrative agency can be a subject of an appeal cannot be determined abstractly and generally. In a specific case, an administrative disposition is an enforcement of law with respect to a specific fact conducted by an administrative agency as a public authority, which directly affects the rights and obligations of the people. The decision should be made individually in consideration of the content and purport of the relevant Act and subordinate statutes, the subject, content, form, and procedure of the act, the actual relation between the act and disadvantage suffered by interested parties, such as the other party, and the principle of administration by the rule of law, the attitude of the administrative agency and interested parties related to the pertinent act, etc. (see, e.g., Supreme Court Decisions 91Nu1714, Jan. 17, 1992; 2008Du167, Nov. 18, 2010).

Article 81-4(1) of the former Framework Act on National Taxes (amended by Act No. 911, Jan. 1, 2010) provides that "tax officials shall conduct a tax investigation to the minimum extent necessary for appropriate and fair taxation, and shall not abuse the right of investigation for any other purpose, etc." while Article 81-7(1) provides that "where a tax official investigates account books, documents, and other articles, etc. for the purpose of the investigation on national tax, he/she shall notify the taxpayer subject to the investigation of the items of taxation to be investigated, period and reason for the investigation, and other matters prescribed by Presidential Decree ten days prior to the commencement of the investigation: Provided, That this shall not apply where it is deemed that the purpose of investigation may not be achieved due to the destruction of evidence, etc.

Meanwhile, individual tax laws, such as the Income Tax Act, recognize the authority to ask tax officials questions when necessary for performing their duties and investigate or order them to submit relevant books, documents, and other things (Article 170 of the Income Tax Act, Article 122 of the Corporate Tax Act, Article 35 of the Value-Added Tax Act), and Article 17 of the Punishment of Tax Evaders Act provides that any person who falsely states questions of tax officials pursuant to the provisions on the right to inquire and investigate tax-related Acts, or refuses or evades his/her duties, shall be punished by

As such, where a tax investigation is made with the authority to inquire and investigate the tax authorities for the imposition of a fine, a taxpayer is legally obligated to answer questions to collect tax data and to allow the tax officials to inspect them. A tax investigation should be conducted to the minimum extent necessary for appropriate and fair taxation. Moreover, re-investigation of the same tax item and taxable period has serious infringement on the taxpayer’s freedom of business operation and rights and interests, and the risk of arbitrary tax investigation by the tax authorities is low, and there is a need to be prohibited except for exceptional cases significantly contrary to the principle of fair taxation (see, e.g., Supreme Court Decision 2008Du10461, Dec. 23, 2010). A tax investigation decision should be subject to appeal as an administrative action by exercising public authority, which directly affects the rights and obligations of the taxpayer.

2. Nevertheless, the court below's decision to conduct a tax investigation of this case is an act that does not directly cause legal change in the legal status of the other party or related persons, and is not subject to an administrative disposition which is subject to an appeal litigation, and dismissed this part of the lawsuit. It is erroneous in the misapprehension of legal principles as to an administrative disposition which is subject to an appeal litigation, thereby affecting the conclusion of the judgment. The

3. Therefore, the part of the judgment of the court below against the plaintiff is reversed, and that part of 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 Min Il-young (Presiding Justice)