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

Cheong-gu Office

The Defendant’s disposition of imposition of capital gains tax of KRW 67,468,240 for the Plaintiff on January 16, 2017 is revoked.

A. On December 19, 1990, the Plaintiff acquired ownership of * Si* Eup*** in Eup* in 304-14 large scale 340 square meters (hereinafter referred to as the “land before the instant land substitution”) and the above brick sap sap 80.8 square meters in a single-story house (hereinafter referred to as the “instant house”) due to the implementation of a land readjustment and rearrangement project in A-si.

On February 11, 2011, the instant house was transferred to a Si on the grounds of an agreement for the acquisition of the land for public use. On July 2009, the instant land was designated as a land scheduled for replotting and then substituted on August 12, 2016 at large scale 470-8 square meters (hereinafter referred to as “land after replotting”). On March 30, 2016, the Plaintiff completed the registration of ownership transfer for the instant land after replotting on the grounds of sale on February 18, 2016.

B. On January 16, 2017, the Plaintiff reported that the land transaction after the instant land substitution constitutes one house annexed to one household, and the Defendant imposed a disposition of imposition of capital gains tax of KRW 67,468,240 (including additional tax of KRW 9,200,479) (hereinafter “instant disposition”) on the Plaintiff on January 16, 2017, on the ground that the land transaction after the instant land substitution fell under one house annexed to one household and the remaining land is transferred after five years have elapsed since the expropriation of the instant land.

C. On March 30, 2017, the Plaintiff filed a request for examination against the Plaintiff, but was dismissed on June 23, 2017.

[Ground of recognition] Facts without dispute, Gap evidence 1 to 4, Eul evidence 1 to 6, the purport of the whole pleadings

2. Whether the instant disposition is lawful

1) A summary of the resolution at the bottom of the evidence No. 5 and the grounds for taxation

A. Summary of the plaintiff's assertion

The proviso of Article 154 (1) 2 (a) of the Enforcement Decree of the Income Tax Act means not only the case of transferring land annexed to a house within five years from the date of expropriation under the Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor (hereinafter referred to as the "Land Compensation Act") but also the case of not subject to restrictions on the period of possession and the period of residence. Article 72 (2) of the Enforcement Rule of the Income Tax Act applies only to the case of transferring the land annexed to a house in installments, and it is not applicable to the case of transferring

The Plaintiff owned only the instant house to a Si on February 14, 201 until the transfer of the instant house by agreement. As such, the Plaintiff is the owner of only one house for one household that meets non-taxation requirements, and as to the income accrued from the Plaintiff’s transfer of land after the instant replotting on March 30, 2016, capital gains tax should be exempted by recognizing the transfer of only one house for one household, as well as the income accrued from the transfer of land after the instant replotting.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) In light of the principle of no taxation without law, or the requirement for tax exemption or exemption, the interpretation of tax laws shall be interpreted as the text of the law, barring any special circumstances. It is not permitted to expand or analogically interpret without reasonable cause, and in particular, it accords with the principle of fair taxation to strictly interpret that the provision of tax exemption or exemption is clearly preferential (see, e.g., Supreme Court Decision 2003Du7392, May 28, 2004).

2) According to the Income Tax Act, the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 27074, Mar. 31, 2016; hereinafter referred to as the “Enforcement Rule”), and the Enforcement Rule of the Income Tax Act (hereinafter referred to as the “Enforcement Rule”), where the land attached to one house for one household subject to non-taxation of capital gains tax is transferred in installments, the land of the transferred part shall not be deemed land attached to one house for one household: Provided, That where part of the house and appurtenant land has been acquired through consultation or expropriated pursuant to the Land Compensation Act, etc., the relevant house (including appurtenant land), the remaining land and the remaining house (including appurtenant land) transferred within five years from the date of acquisition through consultation or expropriation shall be deemed included in the house for one household (Article 89(1)3 of the Income Tax Act, the main sentence of Article 154(1) of the Enforcement Decree, the main sentence of Article 72(2) of the Enforcement Rule)

3) In light of the structure and contents of the foregoing statutory provisions, the principle of strict interpretation of the tax laws and regulations, and the principle of non-taxation on capital gains tax on one house for one household, etc., even if a house corresponding to one house for one household was transferred by expropriation, where a house for one household was transferred after three years have elapsed since the expropriation, it cannot be deemed that it constitutes a land annexed to one house for one household subject to non-taxation on capital gains tax, regardless of whether there were extenuating circumstances for not being transferred within five years (see Supreme Court Decision 2013Du12782, Nov. 14, 2013).

4) Meanwhile, Article 88 of the Income Tax Act provides that the ownership of the instant house is transferred at a price by means of sale, exchange, investment in kind in a corporation, etc., regardless of the registration or enrollment of the transferred assets. Thus, it is reasonable to apply Article 72(2) of the Enforcement Rule with respect to the sale of the instant land after replotting, as it constitutes the transfer where the ownership of the instant house is transferred by consultation or expropriation under the Land Compensation Act.

In addition, Article 89 (1) 3 (a) of the Income Tax Act provides that "one household owns one house and meets the requirements prescribed by the Presidential Decree" as non-taxation objects. According to the above provision, since the Income Tax Act delegates the requirements of Presidential Decree not subject to non-taxation on all transfer income of the house owned by one household, the Enforcement Decree of the Income Tax Act may determine the requirements for non-taxation cases by delegation. Article 154 of the Enforcement Decree of the Income Tax Act provides that the proviso of paragraph (1) provides the scope of one house for one household as a whole and the proviso of subparagraph 2 (a) provides that "the remaining house and its appurtenant land which are transferred within five years from the date of transfer or expropriation shall be included in the remaining house and its appurtenant land." Article 89 (1) 3 (a) of the Income Tax Act provides that "The above provision is located within five years from the date of transfer or expropriation, but Article 154 of the Enforcement Decree of the Income Tax Act provides that the land is not subject to non-taxation by one of the following methods, and its appurtenant land is not subject to taxation.

5) The fact that the land after the instant land substitution was transferred on March 30, 201, past five years from February 11, 201, which was the date of the transfer of the instant land, is as seen earlier, and thus, the land after the instant land substitution does not fall under Article 154(1)2 (a) of the Enforcement Decree.

6) Sub-decisions

Therefore, the defendant's disposition of this case which held that the transfer income of the land after the land substitution does not fall under the land annexed to the house under the above provision is legitimate.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit, and it is so decided as per Disposition.