Cho Jae-2017-China3554 ( October 30, 2017)

The instant transaction does not constitute a consignment transaction.

Since the instant transaction does not constitute a consignment transaction, the Plaintiff is obligated to receive and issue a tax invoice and file a value-added tax return reflecting it in the purchase and sale.

Article 10 (Special Cases of Supply of Goods) (7) of the Value-Added Tax Act

2018Gu Joint 143 Value-Added Tax and Revocation of Disposition of Imposing Corporate Tax

OO

O Head of tax office

July 5, 2018

August 9, 2018

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The defendant's imposition of value-added tax for the first term of 200O.O.O. for the plaintiff, for the second term of 2012, for the second term of 2012, for the value-added tax for the first term of 2013, for the second term of 2013, for the second term of 2013, for the value-added tax for the first term of 2014, for the first term of 2014, for the second term of 2014, and for the imposition of the value-added tax for the second term of 2012, for the corporate tax for 2012, for the corporate tax for 2013, for corporate tax for 2013, and for the corporate tax for the business year of 2014.

1. Details of the disposition;

A. The Plaintiff filed a value-added tax return as a corporation that runs food manufacturing and wholesale and retail business, and as an OO or a purchaser OO or an OO or a purchaser in the taxable period of value-added tax from January 2012 to February 2014.

B. The Defendant conducted an investigation on the Plaintiff from 20O.O.O. to 20O.O.O.O., and conducted an investigation on the Plaintiff, and concluded that the Plaintiff received only a tax invoice equivalent to the amount of the OO won even though the Plaintiff received alcoholic beverages equivalent to the amount of the OO won from the corporation AA (hereinafter “AA”) during the said value-added tax period, and did not receive a tax invoice equivalent to the remaining portion of the transaction. Moreover, the Defendant issued a tax invoice for the portion of the transaction equivalent to the amount of the OO won supplied to BB, etc. from among the alcoholic beverages supplied by AA, and omitted a value-added tax return by failing to issue the tax invoice (hereinafter “the instant transaction at issue”).

C. Accordingly, the Defendant imposed the Plaintiff KRW 20 O.O.O. on the sum of the value-added tax for the first period of 2012 to the second period of 2014, as shown in the attached Table, and KRW O.O. on the aggregate of the corporate tax for the business year between 2012 and 2014 (hereinafter collectively referred to as the “instant disposition”).

D. The Plaintiff filed an appeal against the instant disposition with the Tax Tribunal for the revocation of the instant disposition, but the Tax Tribunal rendered a decision to dismiss the Plaintiff’s appeal. 20O.O.O.O.

[Reasons for Recognition] Facts without dispute, Gap evidence 1, Eul evidence 1 and Eul evidence 2 (including each number; hereinafter the same shall apply), the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The key issue of this case is a type of consignment sale, and the Plaintiff only performed the role of transportation agency, etc. in accordance with the consignment of AA. Thus, the actual party to the transaction is AA, not the Plaintiff. Therefore, the disposition of this case, which was made on the premise that the Plaintiff is the party to the transaction that is obligated to receive and issue the tax invoice, should be revoked illegally.

B. Determination

In selling and buying goods on consignment or through an agent, the truster or the principal directly supplies or is deemed to have received goods (Article 10(7) main text of the Value-Added Tax Act). Here, the consignment consignment refers to the purchase or sale of goods under his/her own name by another person’s account, and is only the supply of goods and services to the truster, rather than the supply of goods. In such a case, the truster is deemed to have directly supplied or received goods (see Supreme Court Decision 97Nu20359, Apr. 27, 199).

According to the following circumstances acknowledged by comprehensively taking account of the respective descriptions in subparagraphs 3 through 5 and the purport of the entire pleadings, this case’s key transaction cannot be deemed a consignment sale. As such, the Plaintiff is obligated to receive a tax invoice for a transaction in which alcoholic beverages are supplied by AA and issue a tax invoice for a transaction in which alcoholic beverages are supplied to another transaction, and to report value-added tax reflecting the purchase and sale of alcoholic beverages. Accordingly, the Plaintiff’s assertion on a different premise is rejected.

(1) As regards the legal relationship between a truster and a trustee, the provisions on delegation of the Civil Act apply pursuant to Article 112 of the Commercial Act to the legal relationship between the truster and the trustee, the trustee has a right to claim reimbursement of expenses and a right to remuneration against the truster. If the Plaintiff, as alleged in its claim, was a commercial merchant pursuing profit, as the trustee of the consignment, he/she would have exercised such right to claim reimbursement of expenses and a right to claim remuneration. However, there is no evidence to support that the Plaintiff claimed expenses or remuneration from the supply of alcoholic beverages to

(2) After conducting an investigation with the Plaintiff from 20O.O.O.O. to 20O.O.O.O.O.O., the Defendant accused the Plaintiff and its representative director on the grounds that the instant transaction did not receive and issue a tax invoice. The Defendant was sentenced to a fine in a criminal trial (O.O.O., Supreme Court Decision 200O.O., Supreme Court Decision 200O.O., etc.).

(3) A commission agent as to whether a trader or customer can be deemed as a general seller.

Whether it can be seen as a product supplier or intermediary trader is involved in who bears the risk of the transaction.

With respect to the circumstances in which the Plaintiff did not receive and issue a tax invoice, the Plaintiff received the proposal of AA to the effect that the Plaintiff would increase the sale of alcoholic beverages to another store by delivering them, and that the Plaintiff explained that the Plaintiff should issue a tax invoice to the seller of the goods in the name of the seller of the alcoholic beverage brokerage business because only the Plaintiff has a liquor retail license, and that the Plaintiff was first offered a proposal from the Plaintiff, and that the Plaintiff’s payment was not good due to the default or unpaid payment by the customer, and that the Plaintiff continued to engage in the transaction of the issue of this case. Each of the above arguments stated that the Plaintiff would have different points on the subject of the first transaction of this case, but that the Plaintiff would incur risks related to the issue of this case, namely, that the transaction of this case would have been supplied not only to the seller of alcoholic beverages but also to the seller of alcoholic beverages in the name of the seller of this case, and that the Plaintiff would have attempted to maintain the Plaintiff’s transaction in the name of the seller of alcoholic beverages, which would decrease the Plaintiff’s direct sales transaction.

(4) Meanwhile, on the grounds that the instant key transaction constitutes consignment sales, the Plaintiff cited the financial details that the company that received alcoholic beverages from the Plaintiff directly paid to the AA using the alcohol card. However, as seen earlier, as long as issuing a tax invoice directly to the customer is the substance of the instant key transaction, it cannot be readily concluded that the transaction amount actually belonged to the AA’s side solely on the ground that the Plaintiff’s name was indicated in the said financial details as AA, as long as the issuance of the tax invoice directly to the customer was a means to avoid the restriction that the Plaintiff possesses only the alcoholic beverage retail license.

3. Conclusion

Thus, the plaintiff's claim is dismissed as it is without merit.