Seoul High Court 2009Nu37427 (2011.06)

early 208west0513 ( October 17, 2008)

not falling under a representative subject to a disposition of recognition, because it is not an officer or a shareholder;

Unless there is no record of being registered as representative on the corporate register, and there is no evidence to deem that an officer such as a shareholder meets the requirements, the representative cannot be deemed as the subject of the recognition and contribution disposition in this case.

Article 106(1) of the Enforcement Decree of the Corporate Tax Act

2011du24026 Global income and revocation of disposition

OraA

The Director of Gangnam District Office

January 27, 2012

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

Article 106(1)1 (proviso) of the former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 1120619, Feb. 22, 2008) provides that “The recognition and contribution system for the representative arising from the disposition of income” shall not be based on the facts arising from such income, but shall be based on certain facts which can be recognized as an act under tax laws by the corporation so that the representative may be considered as a bonus for the de facto representative regardless of its substance. In such a case, the representative of the corporation subject to the disposition of bonus shall be strictly interpreted without the consent of the court below (see Supreme Court Decision 92Nu3120, Jul. 14, 192). The proviso to Article 106(1)1 of the above Enforcement Decree provides that the representative shall be deemed as the representative of the corporation, and that the representative shall not be deemed to have been recorded in the register of shareholders if he or she actually owns the stocks or shares of the corporation, other than the minority shareholder and the person in a special relationship.”