[2] The case holding that the secondary preservation contribution received from the government to compensate for the secondary loss (the secondary loss) caused by the loan interest rate of the small and medium enterprise operated and managed by the Small and Medium Business Corporation, a non-profit domestic corporation, does not constitute the "income from the profit-making business which is subject to corporate tax under the former Corporate Tax Act"

[2] The case holding that the secondary preservation contribution received from the Government to compensate for the secondary loss (the secondary loss) caused by the loan interest rate of the small and medium enterprise operated and managed by the Small and Medium Business Corporation, a non-profit domestic corporation, does not constitute "income from profit-making business" which is subject to corporate tax under the former Corporate Tax Act (wholly amended by Act No. 5581 of Dec. 28, 1998)

Article 1 (1) of the former Corporate Tax Act (amended by Act No. 5581 of Dec. 28, 1998) provides for taxpayers of corporate tax. Under the proviso, nonprofit domestic corporations are obligated to pay corporate tax only on income accrued from profit-making business or revenue under the subparagraphs of the same paragraph notwithstanding their articles of incorporation or purpose business. Thus, non-profit domestic corporations can not impose corporate tax unless income accrues from profit-making business. Whether a business falls under profit-making business or not should consider the relationship with the purpose of business, such as whether the profit accrued from the business is to achieve the proper purpose of the corporation in question. However, in order to constitute a profit-making business, the business itself should be for profit-making or profit-making business (see Supreme Court Decisions 80Nu278, Nov. 11, 1980; 95Nu1435, Jun. 14, 1996, etc.).

According to the above legal principles and the facts and records established by the court below, the plaintiff is a non-profit domestic corporation established under the Act on the Promotion of Small and Medium Enterprises and Encouragement of Purchase of Their Products for the efficient promotion of projects for the promotion of small and medium enterprises. The purpose of the plaintiff's project is to operate and manage the funds for the structural sophistication of small and medium enterprises established by the government for the purpose of supporting the structural sophistication of small and medium enterprises. Unlike the case where the loan interest rate of the business of this case was operated by the Small and Medium Enterprise Restructuring Fund under the Act on Special Measures for the Promotion of Management and Restructuring of Small and Medium Enterprises before December 22, 1994 (amended by Act No. 4824 of Dec. 22, 1994), a large amount of loss (a large loss) is continuously incurred as a result of the change in the financing method, and the decision of the loan interest rate is made with the approval of the competent authorities to achieve the above business objective. Thus, the plaintiff's project of this case cannot be viewed as not only the loan interest rate of this case but also the profit rate of this case.

The court below is just in holding that the business of this case does not constitute a profit-making business, even though the above small and medium enterprise restructuring fund and the small and medium enterprise structural sophistication fund of this case are somewhat inappropriate, and there is no error in the misapprehension of legal principles as to profit-making business of a non-profit corporation or in the misapprehension of legal principles as otherwise alleged in the ground of appeal, or there is no error in the misapprehension of legal principles as to

On the other hand, as long as the above determination by the court below is just, the validity of the additional and family judgment by the court below that the secondary preservation contribution of this case constitutes gross income cannot affect the conclusion of the judgment. Thus, the argument in the grounds of appeal on this part cannot be accepted.

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

Justices Kim Yong-dam (Presiding Justice)