(a) Whether the input tax amount of the relevant value-added tax is deducted, where the relevant transactions are confirmed even though the issue date of the tax invoice is inconsistent with the actual transaction date;

(b)The meaning of transfer of business under section 17(2) of the Enforcement Decree of the Tax Act;

A. If an input tax amount is to be deducted under Article 17(1) and proviso of Article 17(2)1 of the Value-Added Tax Act, and Article 60 of the Enforcement Decree of the same Act, a tax invoice delivered at the transaction period under Articles 16(1), 9(1), and 9(2) of the same Act shall be submitted to the tax authority, but the tax invoice is a documentary evidence to determine value-added tax, and it is to ensure the truth of the documentary evidence, and it is ultimately to ensure that the tax invoice is issued and delivered at the transaction period. Thus, even if the relevant transaction is confirmed by the entry of the tax invoice, if the transaction is confirmed by the entry of the relevant tax invoice,

B. The account payable that is excluded from the rights and obligations concerning the business under Article 17(2) of the Enforcement Decree of the Value-Added Tax Act is also included in the main business transaction. Thus, if the main business is replaced by the comprehensive transfer of physical, human, facility, rights and duties, etc., including the business property, and maintains the identity of the business, the account receivable or account payable cannot be considered as the supply of goods even if it is excluded from the transfer subject.

Articles 17(1), 17(2)1, 6(6) of the Value-Added Tax Act, and Articles 60 and 17(2) of the Enforcement Decree of the Value-Added Tax Act

A. Supreme Court Decision 85Nu75 decided Sep. 23, 1986; 86Nu800 decided Mar. 24, 1987; 85Nu398 decided May 12, 1987

International Technology Development Co., Ltd., Counsel for the defendant-appellant

Head of Yongsan Tax Office

Seoul High Court Decision 87Gu219 delivered on September 11, 1987

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

With respect to the First Ground:

If an input tax amount is to be deducted under Article 17(1) and (2)1 proviso of the Value-Added Tax Act, and Article 60 of the Enforcement Decree of the same Act, a tax invoice delivered at the transaction period under Articles 16(1), 9(1) and (2) of the same Act shall be submitted to the tax authority. However, the tax invoice is a documentary evidence to determine the value-added tax, and it is to ensure the truth of the documentary evidence. Thus, even if a tax invoice is prepared and delivered retroactively after the time of supply or the taxable period expires, if the transaction is confirmed by the entries of the tax invoice, the input tax amount of the value-added tax shall be deducted (see, e.g., Supreme Court Decision 1285Nu398, May 1287; 86Nu800, Mar. 24, 1987).

Therefore, the court below is just in holding that the input tax deduction cannot be denied just because the date of preparation of the tax invoice in March 24, 1984, which was prepared on the basis of the evidence, was made retrospectively at the time of supply for the goods, but the fact of transaction can be confirmed by the entries of the tax invoice, and the date of preparation of the tax invoice was prepared retroactively after the expiration of the time of supply. There is no error of law by misunderstanding the legal principles or by misunderstanding the rules of evidence as alleged.

With respect to the second ground:

Article 6 (6) of the Value-Added Tax Act provides that the transfer of business shall not be deemed the supply of goods. Article 17 (2) of the Enforcement Decree of the same Act provides that the transfer of business under Article 6 (6) of the same Act provides that the transfer of all rights (excluding rights related to amounts receivable) and obligations (excluding rights related to amounts payable) for each workplace shall be comprehensively succeeded to the transfer of the business. Since the accounts receivable or accounts payable excluded from the rights and obligations related to the business are included in the main business transaction, it shall be deemed that the principal transaction of the business is included. Thus, if the business owner is replaced by maintaining the identity of the business through a comprehensive transfer of property, human resources, facilities, and rights, including business property, the above mentioned accounts or accounts payable are excluded from those subject to transfer, it shall not affect the transfer of the business even if the above accounts or accounts payable are excluded from those subject to transfer. Accordingly, the court below's decision is just and there is no error in the misapprehension of legal principles as to the transfer of business or the rules of evidence.

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the defendant. It is so decided as per Disposition by the assent of all participating Justices.

Justices Park Jong-hee (Presiding Justice)