2. The plaintiff's claim is dismissed.

3. All costs of the lawsuit shall be borne by the Plaintiff.

The imposition of capital gains tax of KRW 17,162,910 (including additional tax) imposed on the Plaintiff on July 16, 2013 shall be revoked.

2. Purport of appeal

The same shall apply to the order.

The reason for this part concerning this decision is as follows: ① (a) the part concerning “transfered to another person” in the second part of the judgment of the court of first instance (the date of registration of transfer of ownership was April 29, 201) and ② (b) the part concerning “Conversion acquisition value as KRW 675,978,301” in the second part of the second part is as follows: “The acquisition value as KRW 675,978,301, KRW 338,242,404, etc.; and (c) the part concerning “Conversion acquisition value as KRW 594,846,621, KRW 3621, KRW 362, KRW 362,91,08, etc.” in the second part of the judgment of the court of first instance is as follows: (a) the part concerning “the transfer acquisition value as to the conversion acquisition value as KRW 594,846,621, KRW 21, KRW 362,9108, etc.”; and (b) the part of the judgment of the judgment of the first part is cited

2. Whether the instant disposition is lawful

A. Summary of the parties' assertion

(1) Plaintiff

In accordance with Article 89(1)3 of the former Income Tax Act (amended by Act No. 10625, May 2, 2011; hereinafter “ Income Tax Act”) and Article 154(3) of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 22950, Jun. 3, 201; hereinafter “Enforcement Decree”), the instant building and its site (hereinafter “instant real estate”) should be deemed as housing and calculate the gains on transfer. However, since the Defendant calculated the gains on transfer by classifying the first floor of the instant building and the second floor as housing respectively, the instant disposition is unlawful. Furthermore, the head of the Seoul Special Metropolitan City Office prior to the instant disposition regarding the instant real estate, deeming the entire property tax to be a house in violation of the principle of trust and protection.

(2) Defendant

Article 154 (3) of the Enforcement Decree can only be applied when Article 89 (1) 3 of the Income Tax Act can be applied, and the above provision shall not be applied to calculating the conversion price of the real estate of this case. Furthermore, there is no room for applying Article 89 (1) 3 of the Income Tax Act and Article 154 (3) of the Enforcement Decree to the real estate of this case which falls under a high-priced house. Meanwhile, the disposition of this case cannot be deemed to violate the principle of protection of trust on the ground that only the details of imposition of property tax on the real estate of this case by the head of Gwanak-gu Office

B. Relevant statutes

[Attachment] The entry is as follows.

C. Determination

(1) According to Article 89(1)3 of the Income Tax Act, Articles 156(1) and 160(1) of the Enforcement Decree of the Income Tax Act, where a house subject to transfer and land appurtenant thereto fall under a high-priced house with a total amount of more than 900 million won at the time of its transfer, capital gains tax exemption provisions on one house for one household (Article 89(1)3 of the Income Tax Act) is not applicable, and in principle, capital gains tax is levied on one house for one household. Therefore, even if a house for one household meets the requirements for non-taxation under the Income Tax Act but falls under a high-priced house under Article 156(1)3 of the Enforcement Decree of the Income Tax Act, Article 89(1)3 of the Income Tax Act, Article 154(3) of the Enforcement Decree of the Income Tax Act, and Article 160(1) of the Enforcement Decree of the Income Tax Act provides that a house subject to non-taxation can be deemed as a house under Article 154(3) of the Income Tax Act.

(2) In addition, if the actual transfer value (1.6 billion won) as the instant real estate is confirmed, but if the actual acquisition value is not verifiable, the acquisition value is applied with the conversion value as prescribed by Article 176-2(2)2 of the Enforcement Decree (i.e., actual transfer value x). In calculating the conversion value, Article 99(1)1 of the Income Tax Act, which provides for the standard market price necessary for the calculation of the said conversion value, was amended by Act No. 7579 on July 13, 2005, "land (a. (b) 1)," "building (c) , office and commercial buildings (c) and (d) excluding land prices, and “the standard market price of housing” is determined and publicly announced as the standard market price for the said portion, which is determined and publicly announced by a local government pursuant to the Public Notice of Values and Appraisal of Real Estate Act, unlike the above land prices, the acquisition value of the instant real estate can not be calculated separately from the above portion of the instant real estate in accordance with the aforementioned provisions.

(3) Furthermore, in a tax legal relationship, the principle of trust protection is an exceptional principle applicable to cases where a special circumstance exists where the protection of taxpayer’s trust is deemed to conform to the justice even if the principle of trust is sacrificeed to the principle of trust, so in order to apply the principle of trust protection to a tax authority’s act, trust granted by the tax authority through a public opinion statement, etc. should be sufficient to allow an average taxpayer to have a reasonable and justifiable expectation (see Supreme Court Decision 2011Du5940, Dec. 26, 2013). However, the evidence submitted by the Plaintiff alone is insufficient to recognize that the Defendant expressed a public opinion that can directly assert the principle of trust protection as alleged by the Plaintiff, and there is no other evidence to acknowledge it. Even if the Plaintiff expects that the real estate in this case can be calculated by considering it as a whole as a house, even if it is anticipated that such a remote expectation may not be considered as a trust worthy of legal protection. Ultimately, the Plaintiff’s assertion that the disposition in this case is in violation of the principle of trust protection cannot be accepted.

D. Sub-committee

Therefore, even if the evidence submitted by the Plaintiff and the circumstances of its assertion are considered in full view of the above circumstances in light of the contents of the above relevant laws and regulations, the disposition of this case, which the Defendant calculated the acquisition value or the special long-term holding deduction amount of the real estate divided into housing, shall not be deemed unlawful. Ultimately, the Plaintiff’s claim of this case based on a different premise, is without merit.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed, and since the judgment of the court of first instance is unfair with different conclusions, the defendant's appeal is accepted, and the judgment of the court of first instance is revoked and the plaintiff's claim is dismissed. It is so decided as per Disposition.

[Attachment Omission of Related Acts]

Judges fixed-type (Presiding Judge) Gangwon-gu

1) However, Article 160 of the Enforcement Decree of the Income Tax Act on the transfer of one house by one household, the sum of actual transaction values of which does not exceed KRW 900 million, stipulates that a certain amount of capital gains tax shall be reduced even in expensive houses.