Cho High 2015 Mine590 (2015.03.09)

Extinctive prescription of national tax collection right is five years and is suspended by delivery request or seizure.

The right of the State to collect national taxes shall be extinguished by prescription if it is not exercised within five years from the time it is exercisable, but such extinctive prescription shall be interrupted by a request for delivery or by a seizure.

Article 27 of the Framework Act on National Taxes

Article 28 (Interruption and Suspension of Prescription)

Gwangju District Court 2015Guhap691 Confirmation of Non-existence of Obligations

○ Kim

Korea

2015.08.27

oly 2015.10

1. The part of the claim for nullification of the attachment disposition, among the instant lawsuits, shall be dismissed.

2. The plaintiff's remaining claims are dismissed.

3. The costs of lawsuit shall be borne by the Plaintiff.

1. It is confirmed that the Plaintiff’s liability to pay each tax listed in the attached Table 1 to the Defendant does not exist.

2. On October 27, 2005, the head of ○○ Tax Office confirmed that the attachment of wage claims against the Plaintiff is null and void.

1. Basic facts

A. Taxation by the head of ○○ Tax Office on the Plaintiff

1) From around October 1998 to 2003, the head of ○○ Tax Office imposed each global income tax and capital gains tax (hereinafter referred to as “each of the instant taxes”) as indicated in the separate sheet of debt details in attached Table 1, on the ground that the Plaintiff failed to file a comprehensive income tax return or that there was an error or omission in the details of the return. The amount of tax to be paid by the Plaintiff is KRW 147,669,730 (including additional dues 58,158,600) as of October 27, 2005.

2) Of each tax of this case, the capital gains tax listed in paragraph (5) of [Attachment 1] No. 5 (hereinafter "capital gains tax of this case") is imposed on the ground that the Plaintiff did not report the tax base and tax amount of capital gains tax on the transfer of each of the real estate of this case, even though the Plaintiff acquired capital gains by winning a bid to ○○○○ on December 18, 1998 and acquired on August 31, 1995, on the grounds that the Plaintiff did not report the transfer income tax base and tax amount.

(b) Attachment of the head of ○○ Tax Office;

On October 27, 2005, the director of the ○○ Tax Office attached the Plaintiff’s benefit claim against the ○○ Private Teaching Institute’s school juristic person until the total amount of national tax in October 27, 2005, up to KRW 147,669,730, out of a half of the total amount of benefits, excluding income tax and resident tax, paid every month to the Plaintiff, who was in office at ○○ Private Teaching Institute, with the Plaintiff’s obligee and the school juristic person’s obligor (hereinafter “instant attachment disposition”).

(c) Procedures of the previous trial;

On November 14, 2014, the Plaintiff filed an appeal against the instant attachment disposition with the Tax Tribunal. However, on March 9, 2015, the Tax Tribunal rendered a decision to dismiss the Plaintiff’s appeal on the ground that “the Plaintiff filed an appeal on October 14, 2014 after the lapse of 90 days from October 27, 2005 when the notice of the instant attachment disposition was served.”

[Ground of recognition] Facts without dispute, Gap evidence Nos. 3 through 6, 8, 9, Eul evidence Nos. 1 and 2 (including each number), the purport of the whole pleadings

2. The plaintiff's assertion and relevant Acts and subordinate statutes;

A. The plaintiff's assertion

(i) Claim for the Confirmation of Non-existence of Tax Liability

The tax liability of each of the instant taxes extinguished by the completion of extinctive prescription of the right to collect the national tax. In particular, the transfer income tax of this case is null and void since the Plaintiff did not obtain gains on transfer of each of the instant real estate in excess of the successful bid price, on the grounds that the acquisition price of each of the instant real estate exceeds the successful bid price.

2) Claim for nullification of a seizure disposition

As seen above, the attachment disposition of this case is not effective after the expiration of the extinctive prescription of the right to collect the national tax, and thus, seek confirmation of its invalidity.

(b) Related statutes;

Attached Form 2 shall be as stated in the relevant statutes.

3. Whether the part of the claim for nullification of the attachment disposition of this case is legitimate

The attachment disposition of this case by the head of ○○ Tax Office constitutes a disposition on default under Article 24 of the former National Tax Collection Act (amended by Act No. 8832 of Dec. 31, 2007). Thus, an administrative litigation seeking the revocation or invalidity confirmation of such administrative disposition must be the defendant of the administrative disposition, etc., which is the subject of the lawsuit, externally under his/her name, unless otherwise provided for in other Acts (see, e.g., Supreme Court Decision 95Nu14688, Dec. 22, 1995). Thus, the plaintiff shall seek the revocation of the attachment disposition of this case against the head of ○○ Tax Office.

Therefore, the part of the claim seeking nullification of the attachment disposition of this case against the defendant is unlawful as it is against the non-qualified person (it cannot be deemed that the attachment disposition of this case was completed after the expiration of the statute of limitations for collection of national tax, as seen earlier, even if examined on the merits).

4. As to the part of the claim for confirmation of existence of tax liability

A. As to the assertion that extinctive prescription of national tax collection right has expired

According to Article 27 (1) of the former Framework Act on National Taxes (amended by Act No. 7329 of Jan. 5, 2005), the extinctive prescription shall expire unless the right of the State to collect national taxes is exercised for five years from the time it is possible to exercise the right. However, pursuant to Article 28 (1) 3 and 4 of the same Act, the extinctive prescription shall be interrupted by a request for delivery or seizure, and Article 12-4 (1) 1 and 2 of the former Enforcement Decree of the Framework Act on National Taxes (amended by Presidential Decree No. 18385 of May 10, 2004), concerning the initial date of the extinctive prescription of the right to collect national taxes, with respect to the reported tax amount on which the duty to pay taxes is determined by a report of tax base and tax amount, the following day of the statutory due date for payment, and with respect to the notified tax amount, the following day of the due date of payment by

First of all, with respect to global income tax listed in attached Table 1 Nos. 4, the health world, the payment deadline of the above global income tax on February 28, 2003, and the fact that the attachment disposition of this case was taken on October 27, 2005, which is within five years from the day following the above payment deadline, as seen earlier, the extinctive prescription of the right to collect national tax on the above global income tax is suspended pursuant to Article 28(1)4 and (2)4 of the former Framework Act on National Taxes.

Next, as to each global income tax and transfer income tax listed in [Attachment 1] Nos. 1, 2, 3, and 5], the payment deadline for each of the above global income tax and transfer income tax indicated in [Attachment 1] No. 20. 31, 1998; December 31, 198; August 15, 199; July 31, 199; and as mentioned in evidence No. 60, comprehensively taking account of the purport of the pleading in [Attachment 1], the head of ○○○ Tax Office’s overall purport of pleading No. 6; ○○○○○○○○-dong 234-56, 330. 6m30. 200 to the above global income tax office’s extinctive prescription period; 30m31, 201. 200 to the above domestic tax office’s request for delivery of the Plaintiff’s global income tax amount; 30m31, 2001.

Therefore, this part of the plaintiff's assertion is without merit.

B. As to the assertion that imposition of capital gains tax is invalid

Generally, a tax disposition imposed on a person who does not have any factual relation, income, or act, etc., which is subject to taxation, shall be deemed to be significant and apparent, but where there are objective circumstances that make it possible to mislead him/her to be subject to taxation on certain legal relations or factual relations which are not subject to taxation, the determination of whether it is subject to taxation can only be made clear, even if the defect is serious, and thus, it cannot be deemed as apparent even if it is apparent, and thus, it cannot be deemed that the illegal taxation disposition that misleads the fact subject to taxation is void as a matter of course (see Supreme Court Decision 2001Du7268, Sept. 4, 2002). In an administrative litigation seeking nullification of the administrative disposition, the Plaintiff is liable to assert and prove the grounds for invalidity of the taxation disposition in question (see Supreme Court Decision 2009Du3460, May 13, 2010).

In light of the above legal principles, insofar as the Plaintiff acquired each of the instant real estate and did not report the tax base and tax amount of the transfer income tax, as alleged by the Plaintiff, so long as the acquisition value, etc. of each of the instant real estate did not take place due to the auction in excess of the successful bid price, the above circumstances cannot be deemed as clear as it constitutes a case where the facts can be accurately examined, and its defect is apparent. Therefore, it cannot be deemed as null and void on the ground that there is a serious and obvious defect in the disposition imposing the transfer income tax of this case. Accordingly, the Plaintiff’s assertion on this part is without merit.

C. Sub-committee

In the end, the plaintiff's claim for this part is without merit.

5. Conclusion

Therefore, the part of the lawsuit of this case that claims the invalidity confirmation of the attachment disposition of this case is unlawful, and it is dismissed. The remaining claims of the plaintiff are dismissed as it is without merit. It is so decided as per Disposition.

1

Table of Details of obligations (based on October 27, 2005)

(unit: Won)

net

Congress

Items Code

Management Number

year-end portion;

Principal Tax

Additional Dues

List of Tax Items

Deadline for payment

guidance.

1

19807-5-10

Global Income Tax

0000

July 31, 1998

1. Notice of regular subdivisions

2,026,880

1,896,460

130,420

2

199811-7-10

Global Income Tax

0000

December 31, 1998

The interim prepayment/prepaid notice of 1998.01

3,180,710

1,797,250

1,383,460

3

19908-5-10

Global Income Tax

0000

August 15, 1999

1. Notice of regular subdivisions

6,917,970

6,835,940

82,030

4

200302-6-10

Global Income Tax

0000

February 28, 2003

1. Occasional notice of 1998

17,377,410

12,220,560

5,156,850

5

19907-6-22

Transfer Income Tax

0000

July 31, 1999

1. Occasional notice of 1998

18,166,760

66,760,920

51,405,840

Consolidateds

5 Cases

147,669,730

89,511,130

58,158,600

2

Related Acts and subordinate statutes

Article 27 of the former Framework Act on National Taxes (Extinctive Prescription) (amended by Act No. 7329, Jan. 5, 2005)

(1) Any right of the State to collect national taxes shall be extinguished by prescription, if it is not exercised for five years from the time it is exercisable.

(2) Extinctive prescription under paragraph (1) shall be subject to the Civil Act, except as otherwise provided for in this Act or tax-related Acts.

(3) The time when the State may exercise its right to collect national taxes under paragraph (1) shall be determined by the Presidential Decree.

Article 28 (Interruption and Suspension of Prescription)

(1) The extinctive prescription under Article 27 shall be interrupted by any of the following reasons:

1. A tax payment notice;

2. Urging or demand for payment;

3. Request for delivery;

4. Seizure.

(2) The extinctive prescription interrupted under paragraph (1) shall resume when the period under each of the following subparagraphs expires:

1. Period of payment notified;

2. Period fixed by urging or demand notice of payment;

3. Period specified in the request for delivery;

4. Period until seizure is cancelled.

(3) The extinctive prescription under the provisions of Article 27 shall not proceed during the installment payment period, the grace period, the grace period for a disposition on default, or the grace period for an annual installment payment period under tax-related Acts.

Article 12-4 of the former Enforcement Decree of the Framework Act on National Taxes (Initial Date of Extinctive Prescription of National Tax Right) (amended by Presidential Decree No. 18385, May 10, 2004)

(1) The term "when the State can exercise its rights to collect national taxes pursuant to Article 27 (3) of the Act means the dates falling under any of the following subparagraphs:

1. For the national tax for which the duty of payment is determined by the tax base and return of tax amount, the day following the statutory due date of payment;

2. In cases where the Government determines the tax base and amount of tax and occasional assessment, the day following the due date for payment notified by a notice of tax payment, with respect to such amount of tax.

Article 24 of the former National Tax Collection Act (amended by Act No. 8832 of Dec. 31, 2007)

(1) The tax officials shall seize the taxpayer's properties in cases falling under any of the following subparagraphs:

1. Where the taxpayer fails to pay completely national taxes and the additional dues by the designated period after receiving a notice of demand (including a peremptory notice; hereinafter the same shall apply);

2. If the taxpayer fails to pay completely the tax by the designated period after receiving a notice of tax payment before the period of the tax payment under Article 14 (1).

(2) If the director of the tax office deems that he cannot collect from a taxpayer national taxes after the determination of national taxes due to a cause falling under any of subparagraphs of Article 14 (1), he may seize the taxpayer’s properties to the extent of the estimated amount of national taxes.