Whether the amount of national tax refund following a decision of correction made by the head of a tax office to reduce the output tax amount and the amount of tax paid after a person who is not subject to taxation under the Value-Added Tax Act included the amount of supply transaction in the amount of sales, constitutes “national tax refund” under Article 52 subparag. 1

In the case of a tax return, the tax return is a concept corresponding to the disposition of imposition in the case of a tax payment, and the amount of excess payment among the grounds for refund under the Framework Act on National Taxes refers to the amount of tax reduced in whole or in part as a result of cancellation or correction of the return or disposition of imposition. Thus, it shall not be interpreted that "national tax refund due to cancellation or correction of imposition...... refund due to cancellation or correction of imposition" under Article 52 subparagraph 1 of the same Act refers only to the amount of imposition, and it shall not be interpreted that the amount of tax refund due to the return and correction of value-added tax by the head of a tax office after filing the return and correction of the amount of tax paid and the amount of tax payable

Articles 51(1) and 52 subparag. 1 of the Framework Act on National Taxes

Supreme Court en banc Decision 88Nu6436 Decided June 15, 1989 (Gong1989,1096)

Sung Iron Co., Ltd., Counsel for the defendant-appellant

Korea

Busan High Court Decision 90Na6798 delivered on January 25, 1991

The judgment below is reversed, and the case is remanded to Busan High Court.

We examine the grounds of appeal.

1. Facts established by the court below

A. In filing a return of value-added tax for each workplace without the overall approval for the taxable period from the final return of January 1, 1986 to the scheduled return of February 1987, the Plaintiff issued a tax invoice for the supply of raw materials equivalent to KRW 2,641,05,427 from the Busan factory, and filed a return of tax invoice for the supply of raw materials from the Busan factory to the original factory, and filed a return of tax invoice for the total amount of KRW 264,105,538 by including the above self-supply transaction amount in the sales amount, while filing a return of the total amount of KRW 264,105,538 from the original factory to the original factory. The original tax invoice having jurisdiction over the original factory was paid by deducting the above output tax amount as the input tax amount.

B. The Changwon District Tax Office denied the deduction of the above input tax amount on the ground that the above self-supply transaction between Busan and Changwon Factory does not constitute a taxation transaction, and issued a decision of correction to increase the tax amount by adding additional additional tax returns on negligent tax returns. The Shipping Tax Office issued a decision of correction to reduce the output tax amount and the tax amount to be paid for the above self-supply transaction on the same ground, and refunded the Plaintiff KRW 264,105,538.

2. The judgment of the court below

A. The grounds for refund of national taxes under the Framework Act on National Taxes include (1) any return or disposition of imposition, which serves as the basis for payment or collection, or (2) any return or disposition of imposition, which is made in excess of the amount paid or collected, (3) any amount paid in excess, in whole or in part, due to revocation or correction, even though the return or disposition of imposition is not null and void automatically, and (3) any tax refund prescribed to be returned to each individual tax law because the State had no justifiable grounds to hold thereafter. The Plaintiff’s return of value-added tax by including the amount of supply, which is not subject to taxation under the Value-Added Tax Act, in the sales amount constitutes the excess payment among

B. The interpretation of Article 52 of the Framework Act on National Taxes, which differs from the initial date of calculation of the additional dues due to the occurrence of the national tax refund, includes an erroneous payment under the main sentence of subparagraph 1, and a national tax refund due to double payment, is an example of the above erroneous payment, and the national tax refund due to cancellation of the imposition and correction of the amount under the latter sentence constitutes only the case of imposition under the premise of imposition, and thus, the refund (amount in excess) arising from the decision of correction after the return and payment does not constitute the national tax refund under subparagraph 1 above.

C. In a case where the input tax amount exceeds the output tax amount due to the determination or revision of Article 52 Subparag. 6 of the Framework Act on National Taxes, in a case where there is an increase in the input tax amount due to the result of the determination of correction after the return of value-added tax was made, it is apparent that the said amount constitutes the refundable tax amount due to the determination or revision under the proviso of Article 52 Subparag. 6 of the Framework Act on National Taxes. However, even in a case where the input tax amount after deducting the input tax

D. Therefore, the defendant's assertion that additional dues should be paid to the plaintiff from the date of the original return and payment is without merit.

3. Judgment of party members

A. The reasoning of the court below on the grounds for the refund of national taxes under Articles 51(1) and 52 of the Framework Act on National Taxes and Article 30 of the Enforcement Decree of the same Act is just in accordance with the opinion of the party members (Law No. 88Nu6436, Jun. 15, 1989). The judgment of the court below that the refund of national taxes to the plaintiff by the chief of the shipping substitute tax office constitutes the excess payment is also justified.

B. However, in the case of a tax return, a tax return is a concept corresponding to the disposition of imposition in the case of a tax return. The above excess amount refers to the tax amount reduced in whole or in part due to the cancellation or correction of a tax return or a disposition of imposition. As seen above, it should not be interpreted that only the case of a tax return due to the cancellation or correction of a tax return is subject to imposition.

C. In addition, the amount of refundable tax under the Value-Added Tax Act may be deemed as a system where a taxpayer is subject to the collection of value-added tax at the time of a transaction with the purchaser and the other party is paid to the tax authority, as much as the amount that the tax authority paid in excess of the amount collected as a result of the settlement of the output tax during the same taxable period after the settlement of the output tax amount during the same taxable period, and thus, in this case, it is deemed as the amount of refundable tax that is refunded in accordance with the procedures under the Value-Added Tax Act

D. Accordingly, it is reasonable to view that the national tax refund of this case constitutes the national tax refund due to the determination of correction of the imposition after payment under Article 52 subparagraph 1 of the Framework Act on National Taxes. Thus, the court below erred by misapprehending the legal principles as to the initial date of calculation of the additional refund of national taxes under Article 52 of the Framework Act on National Taxes, which affected the judgment, and it is reasonable

4. Therefore, the lower judgment is reversed, and the case is remanded to the lower court. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Jae-chul (Presiding Justice)