2. The costs of lawsuit shall be borne by the Plaintiff.

A. Acquisition and transfer of the instant house

1) On September 21, 1998, the Plaintiff acquired and owned a house with the same * 530-18 ground (hereinafter referred to as “instant house”) on May 25, 2016, and entered into a sales contract with B and 2 (hereinafter referred to as “instant sales contract”) with respect to the instant house as KRW 1,690,000 for total purchase price, KRW 200,000 for down payment, KRW 500 for intermediate payment, KRW 500,000 for total purchase price (the payment date: July 22, 2016), and the obligation to pay KRW 90,000 for the remainder of August 31, 2016 and also for the simultaneous fulfillment of the obligation to pay KRW 90,000 for the instant house (hereinafter referred to as “instant sales contract”).

2) On August 24, 2016, the Plaintiff acquired one-half share (hereinafter referred to as “CC apartment share”) of the ○○-dong, Seoul ○○-dong 911 apartment complex***dong** (hereinafter referred to as “CC apartment”), and acquired the Mad apartment (hereinafter referred to as “D apartment”) on September 5, 2016. < Amended by Act No. 282-19, Sep. 5, 2016.

3) On September 8, 2016, after the Plaintiff acquiredCC apartment shares and D apartment units, the Plaintiff ordered the instant housing to Non-B and Non-B and paid the remainder of KRW 990,000,000 (hereinafter in this case referred to as “the remainder settlement,” and “transfer of the instant housing”).

4) Details on the transfer of the instant house, the acquisition ofCC apartment shares, and the acquisition of D apartment units

The details are as follows:

B. Disposition of this case

1) On November 30, 2016, the Plaintiff met the requirements for the special exemption from gains from transfer under Articles 89(1)3(a) and 95(3) of the former Income Tax Act (amended by Act No. 14389, Dec. 20, 2016; hereinafter the same) and Articles 155(1), 154(1), 156(1), and 160(1) of the former Enforcement Decree of Income Tax Act (amended by Presidential Decree No. 27506, Sept. 22, 2016; hereinafter the same) (hereinafter the same shall apply) (hereinafter referred to as “the requirements for exemption from gains from transfer” in the statutes; hereinafter referred to as “special exemption from gains from transfer” in total); thus, the Plaintiff calculated capital gains tax for 2018 and paid to the Defendant in accordance with the formula under Article 95(3) of the former Income Tax Act, Article 160(1)1 of the former Enforcement Decree of Income Tax Act.

2) However, on June 12, 2017, as long as the Plaintiff owned a total of three houses at the time of the transfer of the instant house (the instant house,CC apartment, and D apartment), the Defendant did not meet the requirements for special deduction of transfer margin because it did not constitute “case where two houses become two temporarily” under Article 155(1) of the former Enforcement Decree of the Income Tax Act (hereinafter “Enforcement Decree provision of this case”) among the special provisions on the deduction of transfer margin. The Defendant calculated transfer margin pursuant to Article 95(1) of the former Income Tax Act and notified the Plaintiff of the determination and notification of KRW 356,66,940 for transfer margin belonging to the year 2016 (the Defendant did not apply heavy taxation rate among three households under Article 104(4)1 of the former Income Tax Act; hereinafter “pre-reduction disposition”).

3) On September 6, 2017, the Plaintiff appealed against the disposition before the reduction and filed an appeal with the Tax Tribunal.On December 4, 2017, the Tax Tribunal decided to include some necessary expenses claimed by the Plaintiff in addition to the necessary expenses.

4) Around that time, the Defendant included part of necessary expenses in accordance with the purport of the decision of the Tax Tribunal and reduced the amount of KRW 18,520,065, which was then reduced by 338,146,870 (i.e., KRW 356,66,940 - KRW 18,520,065, and KRW 10 according to the National Treasury Fractional Calculation Act).

Facts that there is no dispute over recognition, Gap's 1 through 9, Eul's 1 (including the branch numbers if there is an additional number) and the purport of the whole pleadings.

2. Related statutes;

It is as shown in the attached Table related statutes.

3. Determination on the legitimacy of the instant disposition

A. The issues of the instant case

The determination of requirements for exemption from capital gains tax shall be based on the time of transfer prescribed in Article 98 of the former Income Tax Act, which provides, “The time of acquisition and time of transfer shall be the date of liquidation of the price of the relevant asset except in cases prescribed by Presidential Decree, such as where the date of settlement of the price is unclear in the calculation of capital gains,” barring any special provision or circumstance (see, e.g., Supreme Court Decisions 95Nu3527, Sept. 15, 1995; 97Nu6216, Nov. 24, 198). Such a legal principle shall be likewise applicable when determining the requirements for exemption from capital gains tax.

On September 8, 2016, the Plaintiff, upon receiving the remainder payment of the instant house from thisB and two other parties, owned the instant house,CC apartment shares, and D apartment units at the time of the transfer of the instant house (the Plaintiff’s husband, son, son, son, and son and wife together resided in the instant house, and the Plaintiff’s husband and wife agreed to reside in the instant apartment in Ddong apartment units, and the Plaintiff’s son and son acquired 1/2 shares of CC apartment units with the Plaintiff for the purpose of moving to separate households. However, the Plaintiff’s assertion that the Plaintiff owned 3 housing units at the time of the transfer of the instant house, but it does not change that the Plaintiff owned 3 housing units at the time of the instant transfer. Therefore, the issue of the instant case constitutes “where one household possessing 1 house in Korea has come to possess 2 houses temporarily before acquiring 3 houses” as prescribed by the Enforcement Decree of the instant case.

B. Determination

As long as the Plaintiff had owned three houses at the time of the transfer of the instant house, it cannot be deemed that the instant disposition issued on the same premise constitutes “cases of temporary becoming two houses” as prescribed by the Enforcement Decree of the instant case. The reasons are as follows.

1) It should be strictly interpreted that it can be clearly viewed as a preferential provision among the requirements for tax reduction and exemption.

In light of the principle of no taxation without law, the interpretation of tax laws and regulations shall be interpreted in accordance with the text of the law, barring any special circumstance, and it shall not be extensively or analogically interpreted without any justifiable reason. In particular, the strict interpretation of the provision that can be deemed as the provision of preferential treatment among the requirements for reduction and exemption accords with the principle of fair taxation (see, e.g., Supreme Court Decision 2008Du7830, Oct. 23, 2008). If the Plaintiff received any balance from two (B) non-B during the remainder payment period stipulated in the instant sales contract ( August 31, 2016), the Plaintiff’s ownership of the instant apartment and the instant housing were owned only at that time, and the Plaintiff shall be deemed to have agreed on the remainder payment period from 20 days to 20 days before the expiration of the lease contract, and the Plaintiff shall be deemed to have agreed on the remainder payment period from 16 days to 30 days after the expiration of the lease contract.

However, in general, as prescribed by Article 95(1) of the former Income Tax Act, in cases where the requirements for special cases concerning the deduction of gains from transfer are met, unlike the calculation of gains from transfer under the conditions as prescribed by Article 95(1) of the former Income Tax Act, the instant provisions of the Enforcement Decree, one of the special provisions concerning the deduction of gains from transfer, are applicable to the provisions governing the deduction of gains from transfer by dividing the amount calculated by deducting KRW 900 million from the transfer value by the transfer value. Therefore, the instant provisions of the Enforcement Decree, which are one of the special provisions concerning the deduction of gains from transfer, shall be strictly interpreted. Therefore, insofar as the instant provisions of the Enforcement Decree expressly stipulate the upper limit of the number of houses temporarily owned in the process of acquiring a substitute house due to the transfer

2) Supreme Court Decision 2009Du13788 Decided December 24, 2009 (hereinafter “Supreme Court Decision 2009Du13788 Decided December 24, 2009”) invoked by the Plaintiff is only supporting the Defendant’s assertion.

The Supreme Court Decision 2009Du13788 does not seem to be favorable to the plaintiff in relation to the issues of this case. In other words, the plaintiff is paying attention to the decision of the above Supreme Court which held that applying "serious tax rate to the temporary three houses owned by three houses" to the temporary three houses owned by three houses which are difficult to be deemed to have possessed three houses in the process of acquiring a substitute house for the purpose of relocation at the time of the transfer of a house, is illegal. However, as seen above, the defendant in this case did not apply heavy tax rate to the three houses owned by the plaintiff. As such, the above decision does not directly relate to the issues of this case. Rather, the above decision of the Supreme Court is acceptable as to whether to grant non-taxation benefits in this case as the "temporary two houses owned by the household" can not be granted as long as the number of houses owned by the plaintiff at the time of the transfer regardless of the circumstance of the ownership of the house (the above decision of the Supreme Court is closely related to "the above special case" and "the above decision of the Supreme Court is not related to the above two houses".

A) Details of the Supreme Court Decision 2009Du13788

1) Facts

- Around 1987, the Plaintiff acquired a house A and resided at the same place. The Plaintiff’s spouse acquired a house B (B) around December 2006 for the purpose of migration, and the Plaintiff and his spouse again completed the registration of ownership transfer regarding the house C (C) in order to move to replace B (B) around January 2007.

- On January 19, 2007, the plaintiff's spouse transferred the house A (C) while his/her spouse and spouse own the house C (C).

With respect to the above transfer, the Defendant cannot be deemed to have satisfied the requirements for non-taxation for the temporary two houses under Article 155(1) of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 20720 of Feb. 29, 2008), and imposed capital gains tax on the households owning three houses by deeming that Article 104(1)2-3 of the former Income Tax Act (amended by Act No. 9270 of Dec. 26, 2008) should apply the "serious tax rate for the households owning three houses" under Article 104(1)2-3 of the former Income Tax Act.

2) Progress of litigation

The Plaintiff filed a lawsuit seeking revocation of the disposition imposing capital gains tax by asserting that the non-taxation requirements should be deemed to have been met as a temporary two houses, and even if not, heavy tax rates should not be applied to the households owning three houses. However, the first instance court and the lower court determined that the said disposition is lawful.

3) Judgment of the Supreme Court

○ Whether the heavy tax rate is applied to the households with three houses

Although the Plaintiff owned three houses (A, B, and C) at the time of transferring the Plaintiff’s housing, the Plaintiff entered into a sales contract for the housing of C before paying the remainder of the purchase and sale contract for the housing of C. The Plaintiff could have been holding two houses (A, and B) at the time of the transfer of the housing of C. However, considering the fact that the transferor of C’s housing paid the remainder of the payment before the due date upon request for supply, and that the Plaintiff and his spouse did not acquire D’s housing for speculation purposes, the Defendant’s application of the heavy taxation rate for the housing of C was unlawful in the above case, and thus, reversed the judgment of the lower court.

○ Whether a household which owns two houses temporarily is exempt from taxation

We affirm the judgment of the court below that it cannot be viewed that the non-taxation requirements are satisfied as a temporary two houses owned by the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 20720, Feb. 29, 2008) under Article 15 (1) of the former Enforcement Decree of the Income Tax Act.

B) Comparison with the instant case

In a case where the transferor paid the remaining amount in good faith in advance at the request of the transferee and temporarily owned three houses as stated in the Supreme Court Decision 2009Du13788, if the transferor owned three houses at the time of transfer, it does not constitute “temporary two houses-owner households” as long as the transferor owned three houses at the time of transfer, as seen in the instant case, if the transferor is aware that the transferor had a lease relationship with respect to a part of the houses at the time of the housing sale contract, and thus, is unable to receive the balance on the outstanding payment date as stipulated in the sales contract on the day before the expiration of the lease term, and there is no further room to deem that the requirements stipulated

4. Conclusion

The plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.