1. Articles 119(1)10 and 120(1)9 of the former Restriction of Special Taxation Act (amended by Act No. 9921, Jan. 1, 2010; hereinafter “former Act”) provide for exemption from acquisition tax on the registration of property acquired due to “division meeting the requirements under each subparagraph of Article 46(1) of the Corporate Tax Act” and Article 46(1)3 of the former Enforcement Decree of the Corporate Tax Act provides for exemption from acquisition tax on the registration of property acquired. Meanwhile, Article 46(1)3 of the former Corporate Tax Act (amended by Act No. 9898, Dec. 31, 2009; hereinafter the same shall apply) provides that “The former Enforcement Decree of the Corporate Tax Act (amended by Act No. 9921, Jan. 1, 2010; hereinafter the same shall apply) shall be one of the requirements for “the former Enforcement Decree of the Corporate Tax Act to continue or discontinue the business succeeded to by a divided corporation from the end of the business year in which the date of the merger falls.”

In light of the language and text, structure, etc. of these regulations, if a corporation established by division disposes of at least 1/2 of the value of fixed business assets succeeded from a divided corporation before the end of the business year in which the date of the registration of the division falls, or is not "direct use" for the pertinent business that succeeded from the divided corporation, it shall not be deemed that the succeeded business continues to be operated. Therefore, registration tax and acquisition tax shall not be exempted pursuant to Articles 119 and 120 of the former Special Provision, and the scope of "direct use" should be objectively determined

2. Based on its adopted evidence, the lower court acknowledged the following facts: (a) the Plaintiff was a corporation that was established by dividing the final waste treatment business sector, etc. among the business sector of the Kitwon Co., Ltd. (hereinafter “Litwon”) on March 31, 2009; (b) the Plaintiff’s transfer registration of ownership in the Plaintiff’s name was completed on April 30, 2009 as to the land size 23,801.4 square meters (hereinafter “instant land”) of Gangseo-gu, Busan, which was the Plaintiff’s ownership, on the ground of corporate division on March 31, 2009.

The lower court determined that the instant disposition that imposed registration tax, acquisition tax, etc. on the instant land is lawful on the ground that the Plaintiff cannot be deemed to have used the instant land directly for waste disposal business until December 31, 2009, in light of the following: (a) the Plaintiff, a corporation established through division, succeeded to waste disposal business, etc. from the sources that were divided corporations, and entered into a service contract for the civil engineering and design and authorization of implementation plans on the instant land and the instant land, and submitted only an application for the designation and implementation plan approval to the relevant authorities for waste disposal facilities; and (b) the Plaintiff cannot be deemed to have used the instant land directly for waste disposal business until December 31, 2009.

Examining the records in light of the above provisions and legal principles, such determination by the court below is just, and contrary to the allegations in the grounds of appeal, there were no errors by misapprehending the legal principles on "direct use", which is the requirements for reduction and exemption of acquisition tax and registration tax under Articles 119 and 120 of the former

3. 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 on the bench.

Justices Kim Yong-deok (Presiding Justice)