The effect of the main provision of Article 19(2) of the Enforcement Rule of the Value-Added Tax Act (amended by Ordinance of the Ministry of Finance and Economy No. 1757 of July 12, 198

Article 17 (3) of the Value-Added Tax Act stipulates the type of goods subject to constructive input tax deduction and delegates only to the Presidential Decree the method of calculating the calculation of the amount of tax to the Presidential Decree. Article 62 (1) of the Enforcement Decree of the same Act delegates only the "rate" to the Ordinance of the Ministry of Finance and Economy, which shall be multiplied by the value of the agricultural products, etc. which are the basis for calculating the amount of tax deemed purchase tax, so the main provision of Article 19 (2) of the same Act (amended by the Ordinance of the Ministry of Finance and Economy No. 1757 of July 12, 198) provides that the imported goods of the agricultural products, livestock products, fishery products, or forestry products provided with the exemption of value-added tax under Article 17 (3) of the same Act shall not be included in the amount of value-added tax

Article 17(3) of the Value-Added Tax Act, Article 62(1) of the Enforcement Decree of the same Act, Article 19(2) of the Enforcement Rule of the same Act (amended by Ordinance of the Ministry of Finance and Economy No. 1757 of July 12, 198)

Supreme Court Decision 84Nu539 delivered on March 12, 1985 (electric source agreement) 86Nu573 delivered on February 24, 1987

Embry Maintenance Industry Corporation

Head of Seogsan Tax Office

Busan High Court Decision 87Gu36 delivered on January 29, 1988

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal by the defendant litigant are examined.

Article 17 (3) of the Value-Added Tax Act provides that where an entrepreneur engaged in a manufacturing business imposes a tax on goods manufactured or processed with agricultural, livestock, fishery, or forestry products supplied as raw materials with the exemption of value-added tax, an amount calculated under the conditions as prescribed by the Presidential Decree may be deducted as input tax amount, and delegates only the method of calculating the amount of constructive purchase tax to the Presidential Decree. Pursuant to this provision, Article 62 (1) of the Enforcement Decree of the same Act provides that the amount eligible for constructive purchase tax shall be the amount calculated by multiplying the value of the agricultural, livestock, fishery, or forestry products provided with the exemption of value-added tax by the "rate" prescribed by the Ordinance of the Ministry of Finance and Economy for the value of the agricultural, livestock, fishery, or forestry products provided with the exemption of value-added tax, and thus, only the "rate" which shall be multiplied by the value of the agricultural, livestock, fishery, or forestry products provided with the exemption of value-added tax under Article 17 (3) of the same Act shall be included in the scope of tax credit under the main sentence of Article 198(2) of the Enforcement Rule of the Act.

In the same purport, the court below decided that the part of Article 19 (2) of the Enforcement Rule of the above Act is invalid and ordered the cancellation of the tax disposition in this case based on such determination is just, and there is no reason to issue a different opinion on the ground that there is no misapprehension of legal principles like the theory of

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 on the bench.

Justices Jeon Soo-soo (Presiding Justice) Kim Sang-won