[부가가치세등부과처분취소][공1994.10.15.(978),2662]
(a) Criteria for determining feasibility for recognizing real estate transactions as real estate sales business;
B. A case that reversed the lower judgment’s decision denying the feasibility of real estate transfer transactions
A. Since real estate transactions are conducted as part of business activities, the transfer of a building constitutes the supply of goods subject to taxation under the Value-Added Tax Act. Whether the income accrued therefrom falls under the business income shall be determined according to social norms, considering whether the transaction is conducted with the purpose of profit-making and its scale, recovery and attitude, etc., to the extent that it can be seen as business activities, and the determination should be made according to social norms.
B. The case reversing the lower judgment’s decision on the business feasibility of real estate transfer transactions
Article 1(1)1 of the Value-Added Tax Act, Article 1(1)5 of the Value-Added Tax Act, Article 2(1)5 of the Enforcement Decree of the Value-Added Tax Act, Article 1(1)5 of the Enforcement Decree of the Enforcement Decree of the Value-Added Tax Act, Article 20(1)8 of the Income Tax Act, Article 36
A. Supreme Court Decision 90Nu1045 delivered on September 25, 1990 (Gong1990, 2197) 90Nu6217 delivered on February 26, 1991 (Gong112), 91Nu6559 delivered on November 26, 1991 (Gong192, 356) 92Nu14526 delivered on February 23, 1993 (Gong193Sang, 1105)
Plaintiff’s Lee Jong-soo, Counsel for plaintiff-appellant
Head of the North Mine District Tax Office
Gwangju High Court Decision 91Gu2341 delivered on July 8, 1993
The part of the judgment below against the defendant is reversed and that part of the case is remanded to the Gwangju High Court.
The grounds of appeal by Defendant Litigation Performers are examined.
1. According to the reasoning of the lower judgment, the lower court determined that the Plaintiff’s transfer of the instant real estate to Nonparty 2 on June 17, 1989 is not only the case where the Plaintiff acquired the instant 2 real estate from the 1st five North-gu, Gwangju, 218 square meters and the 4th floor area on its ground (referred to as the “1st real estate”) 198 square meters, and transferred it to Nonparty 1, June 22, 1989, and 3,002 square meters (referred to as the “2nd real estate”) around 3,00,000 square meters (referred to as the “1st 1st 1st 1st 1st 1st 198 and 9th 1st 1st 1st 197th 2nd 197th 1st 2nd 197th 2nd 197th 2nd 2nd 197th 2nd 2nd 198th 2nd 3rd 2nd 2nd 19.
2. However, since a real estate transaction took place as a part of business activities, the transfer of a building constitutes the supply of goods subject to taxation under the Value-Added Tax Act. Whether the income therefrom belongs to business income or not shall be determined according to ordinary social norms by considering whether the transaction aims at profit and whether the transaction is conducted in light of the degree of continuity and repetition of business activities (see Supreme Court Decision 92Nu14526, Feb. 23, 1993).
According to the records in this case, the plaintiff acquired and transferred about 10 times between September 198 and April 1990 real estate of about 10 to about 10 times, including inn and bathing buildings with about 5 stories, and transferred it over about 10 times. It can be recognized that the holding period of the real estate disposed of by the plaintiff during the above period does not exceed 1 year, and in light of the plaintiff's form, size, collection, etc. of real estate transactions, the plaintiff should be deemed to operate real estate sales business. Even if the real estate of this case was transferred under the circumstances acknowledged by the court below, it cannot be denied the feasibility of the transaction that transferred the real estate of this case 1 and 2.
Nevertheless, the court below determined that the Plaintiff’s transfer of the first real estate of this case does not constitute real estate sales business on the grounds of its decision. The court below erred by misunderstanding the facts against the rules of evidence or misunderstanding the legal principles on real estate sales, and it is clear that such illegality affected the conclusion of the judgment. Thus, there is a reason to point this out.
3. Therefore, the part of the judgment below against the defendant is reversed, and this part of the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices.
Justices Shin Sung-sung (Presiding Justice)