2. The costs of the lawsuit are assessed against the defendant.

A. The Plaintiff public interest corporation received each contribution of KRW 50 million from Nonparty 1 (hereinafter “the instant contributor”), KRW 24.65 million from Nonparty 1 (hereinafter “the instant domestic corporation”), KRW 175,350,000 from Nonparty 1’s Hanwon-lane Co., Ltd. (hereinafter “the instant domestic corporation”), KRW 60,000,000 from Nonparty 5,000,000 from Nonparty 1’s superior association at Aju University, and Nonparty 5,000,000 from Nonparty 5 (the representative Nonparty 5) who was comprised of professors and employees of Aju University (basic property KRW 30,00,000,000) on October 17, 2002, and did not change its name into the name “○○○○○ Foundation, a foundation foundation,” but the name was changed to the name of the former Foundation’s head on April 4, 2005).

B. Meanwhile, the Plaintiff owned 84,00 shares (70% out of the total number of shares issued) and 36,000 shares (30% out of the total number of shares issued) by Nonparty 2, his six degree of son, respectively. On February 20, 2003, Nonparty 2 prepared a written consent for property donation to the effect that the instant contributor would contribute 72,000 shares (60% out of the total number of shares issued) and 36,00 shares (hereinafter “the instant shares”) that were donated by Nonparty 2 to each Plaintiff public interest corporation.

C. After that, according to the Plaintiff’s contribution, etc., the total amount of assets as of April 28, 2003 is changed to KRW 18 billion,140,000 reflecting the value of the instant stock from KRW 300,000 to KRW 300,000.

D. Accordingly, on April 28, 2003, the Defendant rendered the instant disposition imposing the gift tax of KRW 14,041,937,00 (including additional tax of KRW 4,01,982,00) on the part of the Plaintiff’s public interest corporation, on September 3, 2008, on the ground that the public interest corporation under the proviso of Article 48(1) of the Inheritance Tax and Gift Tax Act (amended by Act No. 8828, Dec. 31, 2007; hereinafter “Gift Act”) is a case where the Plaintiff’s public interest corporation received a contribution in excess of 5/100 of the total number of outstanding voting stocks of a domestic corporation.

E. On November 11, 2008, the Plaintiff public interest corporation filed a petition for review seeking revocation of the instant disposition with the Board of Audit and Inspection, but was dismissed on September 17, 2009.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1, 2, 5, 14, 15, 16, Eul evidence Nos. 1 through 3 (including the number of each branches), non-party 4's testimony and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff public interest corporation's assertion

(1) The Plaintiff’s public interest corporation does not prepare the articles of incorporation and sign and seal the property at the time of incorporation of the Plaintiff’s public interest corporation. Accordingly, the Plaintiff’s public interest corporation does not constitute “non-profit corporation that has established the property by contributing the property” under Articles 13(4)1, 13(6)3, and 19(2)4 through 8 of the Enforcement Decree of the Gift Tax Act (amended by Presidential Decree No. 18177, Dec. 30, 2003). Therefore, the instant contributor is not specially related to the instant domestic corporation under Article 13(4)1 of the Enforcement Decree of the Gift Tax Act. Thus, the value of the instant stock should not be included in the taxable amount of gift taxes (hereinafter “non-taxable provision of gift tax”).

(2) In principle, while gift tax is not imposed on the property contributed to a public-service corporation, the purport of recognizing certain exceptions in cases where the property contributed to the public-service corporation is a stock is to prevent the acquisition of a parent company’s right of management through a public-service corporation separately established by the re-listed corporation and from evading gift tax. However, the instant contribution did not aim at acquiring control over the instant domestic corporation through the Plaintiff public-service corporation or avoiding gift tax. Accordingly, the instant disposition does not coincide with the legislative intent of imposing gift tax in cases where the property contributed to the public-service corporation is a stock of a domestic corporation (hereinafter “principal”).

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

(1) Purport and nature of the non-taxation clause in the taxable value of donated property

It was originally the primary role of the modern state in protecting life and property of the people from the internal and external perspective and ensuring the minimum conditions for free exchange of private property in the market. However, the ideal of the modern state that the issue of public welfare can be resolved solely by ensuring human rights has been indefinitely in front of the reality of socioeconomic inequality in accordance with industrialization. The Constitution accepts public welfare as the basis for legislation restricting fundamental rights (Article 37(2) of the Constitution), maintains balanced growth and stability of the national economy, and prevents the abuse of economic power, and thus, provides that the State may actively regulate and coordinate the shares of domestic corporations for the purpose of economic democratization through harmony between the economic entities (Article 119(2) of the Constitution). Even if it was inevitable for the State to perform its active role in realizing public welfare and safety, it became impossible for the State to take advantage of the total number of shares issued and outstanding shares of domestic corporations to be 10 percent of the total number of shares issued and outstanding for public interest projects and to increase the number of shares issued and outstanding for public interest projects.

(2) The necessity of exemption from gift tax on shares contributed under the public interest law and exceptional requirements

In light of the importance of the role of the public interest corporation in our legal community according to the increase in the public task of the modern state, the taxation policy under the Gift Tax Act and the response measures under the Gift Tax Act prepared to cope with the realistic problems, etc., where a domestic corporation’s shares are contributed to a public interest corporation, the purpose of the system to include the value of the shares in the taxable value of the gift tax is to prevent economic concentrating on the profit of the relevant public interest corporation or economic friendliness without bearing gift tax. Therefore, if a domestic corporation’s shares were contributed to a public interest corporation is irrelevant to economic concentration or economic friendliness, it is reasonable to view that the relevant public interest corporation is not subject to taxes for the relevant public interest corporation at the time of its establishment by actively taking into account the economic-related factors of its establishment and concentrating on the fact that there is no possibility that it would be an exception to the taxation of the gift tax in the case of its establishment of a public interest corporation based on the premise that it would be unreasonable to view that there is no specific provision regarding the statutory basis of statutory interpretation of the relevant provision.

(3) Judgment on the assertion No. 1

According to Article 13(4)1 of the Enforcement Decree of the Inheritance Tax Act, where a person who contributed stocks of a domestic corporation to a public-service corporation or a person with a special relationship with such person is the largest shareholder of the relevant domestic corporation, the contributor shall be deemed to have special relationship with the relevant domestic corporation. The purport of this provision is to determine that if a person who contributed stocks of a domestic corporation to a public-service corporation or a person with a special relationship with such person has control over the relevant domestic corporation, such a person can maintain control over the relevant domestic corporation through the public-service corporation, so it can be deemed that a special relationship exists between the contributor and the relevant domestic corporation. However, as seen above, the determination of whether there is a special relationship between the Plaintiff and the relevant public-service corporation’s owner [Article 13(6) of the Enforcement Decree of the Gift Tax Act, Article 20 subparag. 1 of the Enforcement Decree of the Framework Act on National Taxes (amended by Presidential Decree No. 15968, Dec. 31, 198) is based on the premise that the Plaintiff and the special relationship with the relevant corporation did not exist.

(4) Judgment on the assertion 2

As seen earlier, the instant contributor is presumed to have a special relationship pursuant to Article 13(4)1 of the Enforcement Decree of the Inheritance Tax and Gift Tax Act. As such, the lawfulness of the instant disposition depends on whether the share contribution of the instant contributor is irrelevant to the concentration of economic power or the control of economic power (the chief director ② is deemed to have the same purpose, and thus, the instant disposition is lawful).

In full view of the statement No. 9 through No. 13 and No. 18, Nonparty 2’s testimony and arguments, the contributor of this case. 85.71% of the shares of the domestic corporation owned by himself/herself and his/her six degree of non-party 2 agreed to contribute all the shares issued by the domestic corporation to the non-party 3. The promoters of the plaintiff foundation are eight persons representing the non-party 3. The first articles of incorporation of the plaintiff foundation was signed and signed and sealed by all the members of the plaintiff foundation. The non-party 1, the director of the non-party 2, the non-party 3, the non-party 1, the non-party 2, the director of the non-party 2, the non-party 7, the non-party 2, the non-party 3, the non-party 3, the director of the plaintiff foundation, who was working for the non-party 1, the non-party 2, the non-party 1, the non-party 2, the non-party 3, and the non-party 3, the president.

According to the above facts, the contributor of this case intended to contribute the shares of this case to the Aju University and to use them for the scholarship business, and does not seem to have been in mind of the establishment of the Plaintiff public interest corporation from the beginning. The 10% shares currently held by the contributor of this case are held at the request of the Aju University, and cannot be deemed to have been held in order to maintain control over the domestic corporation of this case. Accordingly, comprehensively considering all the above circumstances, it cannot be deemed that the contribution to the shares of this case was made with the intent to concentrate economic power or to avoid gift tax in the process of concentrating economic power by making the Plaintiff public interest corporation's holding company of the domestic corporation of this case. Ultimately, the assertion is justified, and the disposition of this case is unlawful.

3. Conclusion

Thus, the plaintiff's claim of this case is justified and accepted.

[Attachment]

Judges Lee Jin-hun (Presiding Judge)