Ohnul E&M Wins Suspension of 29 Billion Won Tax Execution... Seoul Administrative Court Orders Halt of Enforcement Before Main Ruling

Ohnul E&M, a KOSDAQ-listed company, announced on August 19 that it has secured a turning point in resolving its financial instability by obtaining a court decision to suspend the execution of 29 billion won out of a total 110 billion won value-added tax assessment imposed by the tax authorities.

The company stated, "With this legal victory, we have secured a foundation for restoring market trust, which had been undermined by concerns over a management crisis."

On August 13, the Seoul Administrative Court granted a stay of execution regarding the Namdaemun Tax Office's assessment of approximately 29 billion won. Previously, Ohnul E&M filed a lawsuit in June and applied for a provisional injunction in July. Tax and legal experts interpreted the court's decision positively, noting that "a stay of execution is rarely granted unless there is a high likelihood of winning the main lawsuit."

The tax authorities regarded all sales and purchases from the company's travel business between 2018 and 2023 as fabricated transactions, imposing approximately 110 billion won in value-added tax and additional penalties. However, the company has countered that there is clear evidence of actual transactions and that similar cases have recognized such structures as legitimate, arguing that the tax assessment is unjustified.

This tax dispute has had a direct impact on the company's accounting. Following the auditor's recommendations, the company recognized about half of the 110 billion won as a provision for liabilities, resulting in a temporary capital impairment. As a result, the Korea Exchange designated Ohnul E&M as an investment cautionary stock. However, if this provision is excluded, the company does not fall under the criteria for capital impairment.

An industry insider commented, "If the unrealistic factor of the tax assessment is removed, Ohnul E&M's financial soundness is already solid," adding, "This court decision will significantly reduce uncertainty."

A representative from Ohnul E&M emphasized, "This situation is not the result of management failure, but rather an illusion caused by excessive taxation from the authorities," and added, "We are determined to restore corporate value and regain investor trust in the remaining lawsuits as well."

Meanwhile, the company plans to file a tax tribunal appeal for the remaining 81 billion won by the end of August and to pursue both litigation and provisional injunction procedures starting in November. The industry is paying close attention, noting that this victory in the stay of execution could serve as a 'signal' for the outcome of the main lawsuit, rather than being merely a procedural achievement.

This content was produced with the assistance of AI translation services.