2. The plaintiff UB's claim against the defendant head of Suwon Tax Office is dismissed.

3. Of the costs of lawsuit, the part arising between the Plaintiff UBB and the Head of the Suwon Tax Office is borne by the Plaintiff UB, and the part arising between Plaintiff UBA and the Head of the Ulsan Tax Office is borne by the Defendant U. Ulsan Tax Office.

Cheong-gu Office

The disposition of KRW 2,76,09,770 (including additional tax 973,671,663 won) imposed on Plaintiff UB on March 12, 2014 by the head of the competent tax office and the head of the competent tax office on March 12, 2014 shall be revoked.

A. Stock acquisition agreement between the plaintiffs

1) The ○○ Comprehensive Construction Co., Ltd. (hereinafter referred to as “○○ Comprehensive Construction”) is a company established on November 3, 1994 for the purpose of construction business.

2) As of August 20, 2010, Plaintiff 0A owned 177,087 shares out of 191,00 shares of non-listed shares issued by ○○ General Construction (hereinafter “instant shares”) under the name of himself and herself (the Plaintiff 00,198 shares, the name of 80,220 shares, the name of leCC, the name of 17,69 shares, and the name of DoDDD), and Plaintiff 2 is the Dong book of Plaintiff 0A (the Plaintiff 2’s wife’s wife’s wife’s wife’s wife’s opinion is Plaintiff 0,000 shares).

3) 원고 백AA은 2010. 8. 20. 원고 유BB와 사이에, 원고 백AA이 원고 유BB에게 이 사건 주식과 ○○종합건설의 토목건축공사업, 조경공사업 면허권 및 경영권을 대금 3억 원에 양도하기로 하는 내용의 주식양수도계약(이하 '이 사건 계약'이라 한다)을 체결하였는바, 이 사건 계약의 주요 내용은 다음과 같다.

The following shall be entered into between Plaintiffs 0A, leB, A, A and the representative director, KimF (hereinafter referred to as 's disease') and Plaintiff UB (hereinafter referred to as 'B') representing the management of the company of the shareholder, who is a transfer of shares of ○○ General Construction, and Plaintiff UB (hereinafter referred to as 'B').

갑과 병은 ○○종합건설의 주식과 토목건축공사업, 조경공사업 면허권 및 회사경영권을 양도하고, 을은 이를 양수하는 데 그 목적이 있다.

Article 2 (Price for Transfer and Receipt) The price for transfer and takeover shall be KRW 300 million.

Article 3 (Methods of Price Payment) Contract amount shall be KRW 100 million, and KRW 50 million shall be replaced by the amount loaned on January 28, 2010, and the remainder of KRW 50 million shall be paid at the time of concluding a contract. The intermediate payment and remainder shall be paid after the settlement of all taxes, public charges, and liabilities, etc. by December 31, 2010.

Article 4 (Obligation) A and C shall undertake and guarantee the following obligations:

(1) A and C promise that no liability exists except for loans to mutual aid associations publicly announced to B as of the date of conclusion of a transfer agreement.

(2) A and C promise that no unpaid subcontract construction cost, material cost, labor cost, wages for executives and employees, and retirement allowances, as well as delinquent taxes, public charges (including insurance premiums) and liability provisionally attached shall be made until the appointment of the representative director of B.

(3) Before the appointment of the representative director of B, “A” and “C” promise to meet B, regardless of the reasons such as accounting, business performance, occurrence of defects, management, etc., with respect to Article 4 (2) and taxes and public charges, which are incurred or imposed, shall be met.

(4) Any obligation (including any obligation guaranteed) incurred before August 20, 2010 shall be the responsibility of the transferor.

Article 7 (Cancellation of Contracts)

1. Each Party may rescind this Agreement by written notice to the other Party, in the following cases:

- Where there is no correction for the other party, even though the other party has given notice to the other party to correct the violation within seven days of the other party’s breach of its obligations under this contract, unless the correction is made (if it is impossible to correct the defect caused by the breach, it may be immediately rescinded without notice);

2. When this contract is terminated, the parties shall be liable for damages and restitution according to the following classification:

1. If this contract is terminated due to a cause attributable to the assignee, the prescribed down payment will be attributed to the transferor as a final penalty, and the transferee shall not file any civil and criminal claim related thereto and shall waive it.

2. In a case where the contract is terminated due to a cause attributable to the transferor, the transferor shall jointly and severally pay to the transferee an amount equivalent to the sum of the prescribed contract deposit as a penalty.

Article 8 (Compensation for Damages)

In addition to Section 2 of Section 7 of this Agreement, the Parties shall be liable to compensate for any damage incurred by the other party in breach of its obligations or other obligations under this Agreement if any.

4) Pursuant to the instant contract, Plaintiff 0A received KRW 50 million out of the down payment of KRW 100 million from Plaintiff UB on the date of concluding the contract, and the remainder of KRW 50 million against Plaintiff UB’s loan obligations on January 28, 2010.

5) On October 5, 2010, the Plaintiff UB acquired the instant shares from Plaintiff UB from Plaintiff UB to “○○ Development Co., Ltd.” (hereinafter referred to as “○○ Development”) under the following conditions: (a) around October 5, 2010, the Plaintiff UB acquired the instant shares from Plaintiff UB; and (b) on October 25, 2010, transferred the title of the instant shares to “○○ Construction Co., Ltd.” (hereinafter referred to as “○○ Construction Co., Ltd.”).

number of shares in connection with the Plaintiff’s UB’s name

1 Plaintiff UBB 40,000

2 KimG-gu 49,198

3 JurisdictionS 10,220

4 Park H Ha 25,00

5 United StatesJJ East 15,000

6 Hak 37,669

Total 177,087

6) However, on December 31, 2010, Plaintiff UB did not pay Plaintiff UB the intermediate payment and the remainder 200 million won to Plaintiff UB by December 31, 201, which was the term agreed upon under the instant contract, as part of intermediate payment and the remainder. The Plaintiff UB paid KRW 50 million around May 201, and KRW 30 million around June 201, KRW 80 million as part of intermediate payment and the remainder. However, the remainder of the outstanding intermediate payment and the remainder amount of KRW 120 million to Plaintiff by August 201, 201.

B. Imposition of gift tax on Plaintiff UB and imposition of capital gains tax on Plaintiff UB

1) The Ulsan Tax Office investigated changes in the shares of ○○ Development from November 2013 to February 2014. As a result, it determined that: (a) Article 63(1)1(c) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 10411, Dec. 27, 2010; hereinafter “former Inheritance Tax and Gift Tax Act”); and (b) Article 54 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 22579, Dec. 30, 2010); (c) Article 28,968 [7] (net asset value 37,545 x 2) + (net asset value 23,540 x 7 ± 5) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 10411, Dec. 27, 2010; hereinafter referred to as “former Inheritance Tax and Gift Tax Act”); (c) the transfer price of shares to the Plaintiff B due to the lower tax office.

(2) Based on the above investigation, on March 12, 2014, the head of the Suwon Tax Office decided and notified the gift tax amount of KRW 2,776,09,770 (including additional tax of KRW 973,671,663) to the Plaintiff UB on March 12, 2014 (hereinafter referred to as the "disposition for imposition of gift tax of this case"). The head of the Ulsan Tax Office decided and notified the Plaintiff Ulsan Tax Office of KRW 569,196,720 (including additional tax of KRW 22,623,157) (hereinafter referred to as "disposition for imposition of transfer income tax of this case"), and the above two dispositions are referred to as "each disposition of this case."

1) On April 15, 2014, Plaintiff UB dissatisfied with the instant disposition of gift tax, and filed a request for review with the Commissioner of the National Tax Service on April 15, 2014. Plaintiff UB also rejected the instant disposition of transfer income tax, and filed a request for review with the Commissioner of the National Tax Service on April 30, 2014. However, both decision of dismissal was rendered on June 27, 2014.

2) The Plaintiffs filed the instant lawsuit on May 12, 2014, which was before the said decision of dismissal was made. [Grounds for recognition] The Plaintiffs did not dispute, each of the entries in Gap’s 1 through 7, Eul’s 1 through 8, and Eul’s 10 through 12 (including each number; hereinafter the same shall apply), and the purport of the whole pleadings and arguments.

2. The plaintiffs' assertion

For the following reasons, each of the dispositions of this case is unlawful.

A. Cancellation or cancellation of the instant contract

1) At the time of the conclusion of the instant contract, Plaintiff UB promised that the Plaintiff UB shall not be liable for all obligations incurred by the Plaintiff UB’s representative director prior to the appointment of the Plaintiff UB’s representative director. After the conclusion of the instant contract, the Plaintiff UB made an attachment on the grounds of unpaid wages, overdue taxes, etc. The Plaintiff UB knew that the Plaintiff UB belonged to himself/herself on August 30, 201, declared that the instant contract was cancelled or terminated pursuant to Article 7 of the instant contract, and thereby, the instant contract was retroactively terminated.

2) Even if the instant contract was revoked or the right to rescind the agreement was not rescinded under Article 7 of the instant contract, the Plaintiffs agreed to rescind the instant contract on or around August 30, 201, and thus, the instant contract was retroactively terminated upon the rescission of the agreement.

3) As above, so long as the contract of this case was terminated retroactively, it cannot be deemed that the shares of this case were transferred, and the difference between market price and price cannot be deemed as gift on the premise that the shares of this case were transferred.

(b) Over-assessment of the market price;

In light of the vulnerable financial structure of ○○ Development, the acquisition price of the instant shares under the instant contract is 300 million won, and the market price of the instant shares assessed by the Defendant is an excessive assessment.

3. Relevant statutes;

It is as shown in the attached Form.

4. Determination on the legitimacy of each of the dispositions of this case

A. Whether the contract of this case was revoked or cancelled

1) Facts of recognition

A) On October 25, 2010, Plaintiff UB acquired the instant shares under the instant contract, and commenced operating ○○ Development after taking office as the representative director of ○○ Development. However, following the Plaintiff UB taking office, the Plaintiff UB filed a lawsuit against ○○ Development and filed an application for a claim, provisional seizure of claims, such as several construction cost, wages, bills, and bills, and a payment order against ○○ Development from March 201 to August 201.

B) On August 30, 2011, Plaintiff UB resigned from office as the representative director of Postal Development, and PP took office as the representative director of Postal Development. On November 11, 2011, 201, TPP resigned from office as the representative director and Plaintiff UBE, the wife of Plaintiff UB, was appointed as the representative director of ○○ Development. Plaintiff UBA operated ○○ Development as the main agent of ○○ Development after Plaintiff UB was released from office as the representative director.

C) On March 2012, 201, ○○ Development reported corporate tax for the business year of 2011, and submitted a detailed statement of the change of stocks (No. 13-1) and a detailed statement of the transfer of stocks and equity shares (No. 13-2) to the effect that 40,000 shares of the instant shares that were transferred in the name of Plaintiff UB and 49,198 shares that were transferred in the name of KimG, Kim G, the seat of Plaintiff UB, and 198 shares that were transferred to KimM.

D) From December 201 to August 2014, 201, Plaintiff UB’s wife territoryS account as the remitter of Plaintiff UBA or its wife authorityE or ○○ Development once or twice a month with the amount of KRW 500,000 to KRW 1.1 million, a large amount of KRW 5 million to KRW 5 million.

E) On October 20, 2014, the Plaintiffs entered into an settlement agreement following the rescission of the instant contract (hereinafter “instant settlement agreement”) and entered into an settlement agreement (Evidence A No. 8-1) with the content of the agreement. The key contents are as follows.

Account Settlement Agreement

1. With respect to the rescission of the instant contract on August 30, 2011, KRW 25,348,000 out of the amount of KRW 180 million, which was returned, was returned, but the amount of KRW 348,00 was appropriated as interest, and the remainder was KRW 100,000. KRW 5,000 has not been returned until now, and only interest has been paid KRW 1,100,00 per month.

2. Accordingly, the Plaintiffs agree to settle all issues partially as follows, and to not claim damages, such as penalty, in relation to the already rescinded contract:

(a) Remaining principal: 150 million won;

(ii) Unpaid interest: 1,955,000 won;

F) On October 20, 2014, the settlement agreement of the instant case was concluded, the remitter was transferred from the bank account of ○○ Development to the bank account of 156,95,000 won from the Plaintiff UBB to the bank account of 156,95,000 won.

G) On December 13, 2013, Plaintiff UB violated Article 4 of the instant contract after being subject to the second investigation by the East U.S. Tax Office on December 13, 2013, and the Plaintiff UB submitted each of its August 30, 201, stating that “The Plaintiff UB shall rescind the instant contract in accordance with Article 7 of the instant contract,” and each of its documents was prepared retroactively from the date of the first investigation on Plaintiff UBB on November 28, 2013. < Amended by Presidential Decree No. 23507, Aug. 30, 2011>

[Ground of recognition] Facts without dispute, Gap evidence Nos. 5 through 19, Eul evidence Nos. 2, 5, 9, and 13, part of witness KimM's testimony and the purport of the whole pleadings

2) Determination

The facts of the recognition are insufficient to recognize that the plaintiff UB revoked the contract of this case on the ground of the plaintiff 0A's deception, or that the contract of this case was rescinded by the right to rescind the contract of this case under Article 7 of the contract of this case, and there is no other evidence to acknowledge it.

However, as of August 30, 201, Plaintiff UB retired from the position of the representative director of development, and Plaintiff UB again sought the right to manage ○○○ Development from December 2011, Plaintiff UB transferred money on several occasions from Plaintiff UB to Plaintiff UB before the instant settlement agreement was reached. On October 20, 2014, the instant settlement agreement was concluded between the Plaintiffs to complete the settlement of accounts following the rescission of the instant contract. Since August 30, 201, it is reasonable to view that the instant agreement was rescinded in light of the facts acknowledged and the purport of the entire pleadings and all the circumstances acknowledged by the Plaintiffs, including that Plaintiff UB transferred 49,198 total shares transferred in the name of Plaintiff UB, 198, 89,198 shares, among the shares of this case, to Plaintiff UB, the seat of Plaintiff UGB, around 31, 201.

B. Whether each of the dispositions of this case is legitimate following the rescission of the agreement of this case

1) Whether the imposition of the transfer income tax of this case against the Plaintiff 0A is legitimate

A) The transfer income tax is imposed on the premise that the transfer of assets and income accrued therefrom accrue. If the sales contract was rescinded by agreement, the sales contract becomes null and void, and thus the transfer of assets does not take place (see, e.g., Supreme Court Decision 92Nu944, Dec. 22, 1992).

However, as seen earlier, since the instant contract was rescinded by agreement around August 30, 201, it cannot be deemed that there was a transfer of the instant shares, which is a taxation requirement of the disposition imposing the transfer income tax of this case, and it was no room for Plaintiff 0A to incur a transfer income tax. The instant disposition imposing the transfer income tax of this case is unlawful as it imposes the transfer income tax on a person who has no transfer income.

B) As to this, the Defendant asserted that the Plaintiffs’ rescission of the agreement on the instant contract was in collusion to evade high-amount tax, and that it cannot be deemed a normal rescission of agreement. However, the evidence submitted by the Defendant alone is insufficient to recognize that the Plaintiffs’ rescission of the agreement on the instant contract was merely a fictitious act for the purpose of making a false conspiracy or unfairly reducing their taxes imposed on them, and there is no other evidence to acknowledge it.

2) Whether the imposition of the gift tax of this case against Plaintiff UB is legitimate

A) If a contract is rescinded by the exercise of a statutory rescission right due to the debtor’s nonperformance or becomes retroactively null and void due to the forfeited contractual terms, it shall be deemed that there was no gift act under the contract from the beginning. Therefore, gift tax is unlawful.

However, Article 31(4) of the former Inheritance Tax and Gift Tax Act provides that "where the donated property (excluding money) is returned by an agreement between the parties within the return deadline under Article 68, it shall be deemed that no donation existed from the beginning: Provided, That this shall not apply where the tax base and tax amount have been determined pursuant to Article 76 before returning the donated property." Even if a donation contract was rescinded before the said taxation was made, it shall not be deemed that the return was made within 3 months from the end of the month to which the date of donation belongs) under Article 68 of the former Inheritance Tax and Gift Tax Act, or where the donation contract was rescinded by agreement after the said return deadline expires, the disposition imposing the gift tax already imposed cannot be asserted (see, e.g., Supreme Court Decision 97Nu184, Jul. 11, 1997); Article 31(4) of the former Inheritance Tax and Gift Tax Act provides that where the transferee of the donated property is no longer entitled to the return of the donated property under Article 31(4) of the former Inheritance Tax and Gift Tax Act.

B) However, as seen earlier, the Plaintiff UB concluded the instant contract on August 20, 201 and accepted the instant shares on October 5, 2010, and completed the transfer of title to the instant shares under the name of himself and herself on October 5, 2010. The instant contract was rescinded by agreement around August 30, 201, when about 10 months elapsed from the said transfer date (it cannot be deemed that the Plaintiff UB cancelled the instant contract on the ground of Plaintiff UB’s deception or rescinded the instant contract on the right to rescind the agreement under Article 7 of the instant contract on the grounds of the cancellation of the termination date of the agreement under Article 68 of the former Inheritance Tax and Gift Tax Act, and thus, it constitutes a case where the donated property is returned by agreement only after the deadline for filing the gift tax under Article 31(4) of the former Inheritance Tax and Gift Tax Act. Notwithstanding the cancellation of the agreement under Article 31(4) of the former Inheritance Tax and Gift Tax Act, the Defendant U.S. Head of the tax office is entitled to legally impose gift tax on Plaintiff UB.

C. Whether the Defendant has excessively assessed the market price of the instant shares

1) In the case of unlisted stocks with low market value, where there is a fact that they are traded, the value of the stocks shall be assessed on the basis of the market value and the value of the stocks shall not be assessed on the basis of the supplementary evaluation method stipulated in the former Inheritance Tax and Gift Tax Act. However, since the market value means the objective exchange price formed through the general and normal transaction, in order to be recognized as the market value, the circumstances should be recognized that the relevant transaction is made in a general and normal manner and properly reflects the objective exchange value as of the date of donation (see Supreme Court Decision 2010Du26988, Apr. 26, 201

2) As long as the instant shares were purchased and sold in a general and normal manner with respect to the instant shares other than the instant contract, it constitutes “where it is difficult to calculate the market price under Article 60(3) of the former Inheritance Tax and Gift Tax Act”, the Defendant did not err by leaving the value assessed in accordance with the supplementary method of assessment under Article 63 of the former Inheritance Tax and Gift Tax Act, regardless of the market price of the instant shares at the market price.

Meanwhile, the evidence submitted by the plaintiffs alone is insufficient to recognize that the market price of the shares of this case under the supplementary evaluation method under the former Inheritance Tax and Gift Tax Act has been excessive, and there is no other evidence to acknowledge it.

5. Conclusion

Therefore, the plaintiff 00 U.S.'s claim against the defendant U.S. Head of U.S. Tax Office is justified. The plaintiff U.S. Head of U.S. Tax Office's claim against the defendant U.S. Head of U.S. Tax Office is dismissed.