2014west 1352 (Law No. 19, 2014)

The second tax investigation can not be deemed as a false tax invoice because it is illegal.

The evidence submitted by the defendant alone cannot be viewed as an exception to the second tax investigation, and it cannot be viewed as a false tax invoice.

2014 Gohap65318 Revocation of Value-Added Tax Imposition Disposition, etc.

OOOOOOO

O Head of tax office

2015.03.06

2015.04.03

U.S. P. P. P. P.S.

Part III

sales agreement

2014 Gohap65318 Revocation of Value-Added Tax Imposition Disposition, etc.

OOOOOOOO

OOOOOO and OO(Odong)

representative director ccc

Law Firm LLC, Attorneys OOO-O

O Head of tax office

Litigation PerformersOO,OO

March 6, 2015

April 3, 2015

1. The Defendant’s imposition of KRW 51,081,380 of value-added tax on September 2, 2011 against the Plaintiff (including additional tax) and KRW 6,330,50 of corporate tax for the business year 2011 (additional tax on evidence of expenditure) shall be revoked.

2. The costs of the lawsuit are assessed against the defendant.

Cheong-gu Office

The same shall apply to the order.

1. Details of the disposition;

A. The Plaintiff, a corporation engaged in the wholesale business of machinery tools, non-ferrous metal wholesale business and trade business, and the Plaintiff entered into a transaction with AAAA (hereinafter referred to as “AAAA”) during the 2nd taxable period of the 2nd taxable year of the 2011, and entered into a tax invoice of KRW 287,750,000 in total amount of supply (hereinafter referred to as “the instant tax invoice”, including the pertinent transaction; hereinafter referred to as “the instant transaction”). The Plaintiff completed the return of value-added tax and corporate tax by deducting the pertinent amount from the input tax amount and including the amount in the deductible expenses.

Details of receipt of tax invoices

(unit: g, source)

Date of Preparation

Items

Quantity

Unit Price

Value of Supply

October 21, 2011

b) If the

100,000

1,124

12,400,000

November 1, 2011

b) If the

150,000

1,169

175,350,000

Total

250,000

287,750,000

B. The Defendant conducted a tax investigation on the Plaintiff from September 20, 2012 to October 24 of the same year (hereinafter referred to as “the first tax investigation”) and determined that the transaction between the Plaintiff and the AAAAAA (hereinafter referred to as “AAAA”) with respect to the instant tax invoice was a normal transaction.

C. However, as a result of the investigation by item of value-added tax conducted by AA from August 24, 2012 to December 10, 2012, the head of the OOOOO made an accusation against AA and AA, who is its representative director, on the ground that it constitutes a data that receives a tax invoice without a real transaction during the second and second taxable periods in 2011 and the first taxable periods in 2012, and filed an accusation with the investigative agency of AA and AA, who is its representative director, on the other hand, determined the instant tax invoice as a processed tax invoice and notified the Defendant of the relevant taxation data on December 28, 2012.

D. Accordingly, from May 30, 2013 to August 8, 2011 of the same year, the Defendant again conducted a tax investigation with respect to the Plaintiff (the partial investigation related to trade order; hereinafter referred to as "the second tax investigation"), and as a result, the Plaintiff issued the instant tax invoice from AAAA, not an actual supplier, even though the Plaintiff was supplied with non-data suppliers, and imposed penalty tax on the Plaintiff on the receipt of false documentary evidence without deducting the relevant input tax amount, and on September 2, 2013, on September 2, 2011, the Defendant corrected and notified the Plaintiff of KRW 51,081,330,50 for the business year belonging to the second taxable year (including additional tax on the documentary evidence collection) and the corporate tax (including additional tax on the documentary evidence collection) of KRW 6,30,500 for each year (hereinafter referred to as "the instant disposition").

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, 10 evidence, Eul evidence 1 to 7 (including each number), the purport of the whole pleadings

2. The plaintiff's assertion

A. Although the Defendant had confirmed that the instant tax invoice was issued normally through the first tax investigation, the Defendant conducted the second tax investigation for the same tax item and taxable period. The second tax investigation was conducted under the condition that there is no clear evidence to acknowledge the suspicion of tax evasion, which constitutes an illegal reinvestigation contrary to Article 81-4 of the Framework Act on National Taxes, and thus, the instant disposition based on it is unlawful.

B. In order to respond to the price fluctuation from time to time, the Plaintiff agreed to adjust the unit price for the AAA and the supply of the goods to the seller, at the same time, and agreed to make the transaction with the purchaser, BBBB, etc., and received the goods supplied by AAA from the Plaintiff’s office and delivered the goods directly to the seller by the day of the transaction. The instant tax invoice is issued in the normal real transaction process as seen above, and does not constitute a tax invoice different from the facts under Article 17(2)2 of the former Value-Added Tax Act (amended by Act No. 11873, Jun. 7, 2013; hereinafter “Value-Added Tax Act”).

C. Even if the instant tax invoice falls under a false tax invoice on the name or title of the business operator who supplied the instant tax invoice, the Plaintiff was issued the instant tax invoice without knowing that the Plaintiff was not a genuine supplier. In addition, in the course of trading with AA, the Plaintiff was not negligent in not knowing that the Plaintiff was a real supplier, since it was obtained a business registration certificate, corporate register, etc. and visited and inspected the status of the direct office, and thus, the Plaintiff did not know that the Plaintiff was a real supplier. Accordingly, the instant disposition taken on a different premise is unlawful.

3. Relevant statutes;

Attached Form is as shown in the attached Form.

4. Determination

A. Article 81-4(2) of the former Framework Act on National Taxes (amended by Act No. 12162, Jan. 1, 2014; hereinafter “Framework Act on National Taxes”) provides that “[t]he tax officials shall not conduct reinvestigations on the same items of taxation and the same taxable period except in exceptional cases prescribed in the following subparagraphs, such as where there is clear evidence to acknowledge a suspicion of tax evasion,” and “[t]he tax officials shall not conduct reinvestigations on the same items of taxation and the same taxable period.” Furthermore, a reinvestigations on the same items of taxation and the taxable period shall be conducted within the minimum scope necessary for appropriate and fair taxation, and it may seriously infringe on taxpayers’ rights and interests, such as taxpayers’ freedom of business, and may pose a risk of arbitrary tax investigations by the tax authorities.” In addition, the former Enforcement Decree of the Framework Act on National Taxes (amended by Act No. 12162, Jan. 1, 2014; hereinafter referred to as “the former Enforcement Decree of the Framework Act on National Taxes”) provides for a taxpayer’s tax evasion system, including strict data.

As to the instant case, the Defendant conducted the first tax investigation with respect to the Plaintiff from September 20, 2012 to October 24, 2012, and as a result, recognized that each of the instant tax invoices were issued through normal transactions and concluded the tax investigation.

As a result of the Seoul Regional Tax Office’s tax investigation with respect to AAA, the Defendant asserts that it was lawful since the Seoul Regional Tax Office’s decision of 100% of the AAA’s sales during the second and second taxable periods in 2011 and 19.96% of the purchase transaction as the processing transaction, and notified the Defendant of the data for taxation, thereby making the Defendant’s second tax investigation with respect to the Plaintiff, which was conducted based on evident evidence to acknowledge the suspicion of tax evasion.

However, the above evidence revealed that Gap evidence Nos. 3, 9, Eul evidence Nos. 3, 4, 7, and 18 were used as a whole to conduct the second investigation, and the following circumstances, i.e., the defendant failed to submit objective evidence to prove that "AA" was involved in real transactions, such as transportation-related documents, etc., under the condition that the Seoul Regional Tax Office did not specify the payment guarantee of the plaintiff, and only traded credit only with the purchase price transfer to the purchaser within one hour upon receiving the price from the plaintiff, and it is hard to view the plaintiff as an object of the second investigation and to notify the defendant of the fact that the above facts were already revealed in the first investigation of the plaintiff, or that there were no other evidences to prove that there was a change in the market price of the plaintiff's main metal in the process of the second investigation.

B. Family judgment

Even if the second tax investigation is lawful re-audit, it is difficult to view the instant tax invoice as constituting a false tax invoice in light of the following facts, and thus, the instant disposition taken on a different premise is unlawful in this respect.

1) A false tax invoice under the Value-Added Tax Act

Article 16(1) of the former Value-Added Tax Act (amended by Act No. 11129, Dec. 31, 201; hereinafter referred to as "value-Added Tax Act") provides that where an entrepreneur registered as a taxpayer supplies goods or services, he/she shall issue a tax invoice stating the registration number, name or title, the registration number, value of the recipient, value-added tax, date of preparation of the value-added tax, etc. (hereinafter referred to as "necessary entry items") to the recipient of the goods or services, and Article 17(2)2 of the same Act provides that the input tax amount shall not be deducted from the output tax amount if all or part of the requisite entry items are not entered or mistakenly entered in the

In this context, the meaning that the entries of a tax invoice under the Value-Added Tax Act are different from the facts, in light of the purport of Article 14(1) of the Framework Act on National Taxes that provides that if the ownership of income, profit, calculation, act or transaction subject to taxation is nominal and there is another person to whom such entry belongs, the person to whom such entry belongs shall be liable as a taxpayer, and the person to whom the tax invoice is applied, does not coincide with the actual supplier, the person to whom the goods or service is supplied or the person to whom the goods or service is supplied, the value, and the timing of the transaction, regardless of the formal entries of the transaction contract, etc. made between the parties to the transaction with respect to the goods or service (see, e.g., Supreme Court Decision 96Nu617, Dec. 10, 1996). Thus, even if the transaction of supplying the goods actually exists, it shall be deemed that the supplier constitutes a tax invoice issued in so-called disguised transaction different from the actual owner of the tax invoice (see, e.g.

In addition, in imposing value-added tax, the burden of proving that a tax invoice received in the course of a transaction constitutes a tax invoice different from the fact under Article 17(2)2 of the Value-Added Tax Act for which the deduction of an input tax amount is denied on the ground that the transaction is a nominal transaction for which no substantial delivery or transfer of goods is made (see, e.g., Supreme Court Decision 2008Du13446, Jun. 23, 2009).

2) Whether the instant tax invoice constitutes a false tax invoice

The above evidence: (a) it is difficult to view that the Plaintiff’s disposal of the purchase price under the tax invoice of this case was based on the following circumstances, i.e., (b) daily price fluctuations in major metal transactions including the land, and the Plaintiff appears to serve as an intermediate distributor in the instant transaction; (c) it is difficult to view that the final buyer entered into a contract without a separate contract, and in order to transfer the purchase price to the corporate account of AA; and (b) the Plaintiff transfers the purchase price under the tax invoice of this case to the account of the EA (State), the purchaser of which was not the Plaintiff’s purchase price; and (c) the Defendant, in light of the fact that there was no other evidence that the Plaintiff received the purchase price under the tax invoice of this case from the Plaintiff to the account of the EA (State), and that there was no other evidence that the Plaintiff did not directly receive the purchase price from the Plaintiff and the Plaintiff’s representative director from the Plaintiff’s purchase-free material, but the Plaintiff and the AAA were not aware that the purchase price was actually deposited in the account of the Plaintiff’s purchase price.

5. Conclusion

The plaintiff's claim is reasonable, and it is so decided as per Disposition.