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

Cheong-gu Office

The defendant shall pay 5% interest per annum to the plaintiff from July 1, 2011 to the service date of a copy of the complaint of this case, and 20% interest per annum from the next day to the day of complete payment.

A. On July 27, 2007, PCC participated in the capital increase by a third party (hereinafter “BB”) that was conducted by BBB Co., Ltd. (hereinafter “BB”) and acquired 689,000 shares of the said company in the capital increase (hereinafter “the capital increase in this case”). The market price of the shares was OOB per share.

B. On July 1, 2011, the director of the Central Regional Tax Office of China conducted an investigation of stock change with BB, and notified the competent tax authority of the leCC of taxation data that the leCC received a gift under Article 39(1)1 of the Inheritance Tax and Gift Tax Act by being allocated stocks at a low price in comparison with the market price. Accordingly, the pertinent customs authority imposed OOOO(s) on the leCC (hereinafter “instant disposition”). Moreover, on July 1, 2011, the leCC paid OO(s) for gift tax (hereinafter “instant gift tax”).

Facts that there is no dispute over recognition, Gap evidence 1 and 2, and the purport of the whole pleadings.

2. Summary of the Plaintiff’s assertion

Article 39(1) of the Inheritance Tax and Gift Tax Act provides that the taxation subject to the capital increase by issuing new stocks by a third party shall be excluded from the case of allocating them by the method falling under the offering of securities in accordance with Article 2(3) of the

However, in the case of the capital increase in this case, there are 59 persons who have been solicited to subscribe, and 104 persons who have been solicited to subscribe within six months, and thus, it constitutes a case of allocating securities by the method of public offering under Article 2(3) of the Securities and Exchange Act.

Although the capital increase in this case is not subject to taxation, the disposition in this case is null and void due to a defect in violation of the laws and regulations, so the gift tax in this case acquired by the defendant lost the grounds for taxation.

Ultimately, leCC acquired a claim for return of unjust enrichment corresponding to the gift tax of this case against the Defendant, and transferred this claim to the Plaintiff.

Therefore, the defendant is obligated to pay to the plaintiff as the transferee the amount equivalent to the gift tax of this case as OOO and damages for delay.

3. Determination

(a) Related statutes;

Inheritance Tax and Gift Tax Act (amended by Act No. 8828 of Dec. 31, 2007)

Article 39 (Donation of Profits Following Capital Increase)

(1) Where profits have been acquired, as a corporation issues new stocks or equity shares (hereafter in this Article, referred to as “new stocks”) in order to increase its capital (including the amount of investment; hereafter in this Article and Article 39-2, the same shall apply), falling under any of the following subparagraphs, the amount equivalent to the relevant profits shall be deemed the value of donated property of the person who

1. In case where new stocks are issued at a price lower than the market price (referring to the price assessed under Articles 60 and 63; hereafter in this paragraph and Article 40 the same shall apply), the benefits falling under any of the following items:

(a) In case where a shareholder of the relevant corporation (including an investor; hereafter the same shall apply in this Article) has renounced wholly or partially the right to receive new stocks, and where such renounced new stocks (hereafter referred to as " forfeited stocks" in this paragraph) are allocated (excluding the case where a stock-listed corporation or Association-registered corporation under the Securities and Exchange Act allocates them by the method of solicitation of securities under Article 2 (3) of the same Act; hereafter the same shall apply in this paragraph), the benefits acquired by those who received the allocation of relevant forfeited stocks

(c) Profits acquired by a person who is not a stockholder of the relevant corporation by directly obtaining an allocation of new stocks from the relevant corporation (including the case of directly accepting and acquiring the relevant new stocks from an underwriter under the Securities and Exchange Act; hereafter in this paragraph, the same shall apply), or by directly obtaining an allocation of new stocks in excess of the number entitled to receive an allocation under equal conditions in proportion to the

Securities and Exchange Act (before the repeal by Act No. 8635 of August 3, 2007)

Article 2 (Definitions)

(3) The term “public offering of new securities” in this Act means securities which are newly issued under the conditions as prescribed by the Presidential Decree.

(1) The term "tender for acquisition" means a solicitation for an offer to acquire it.

Enforcement Decree of the Securities and Exchange Act

Article 2-4 (Public Offering and Sale of Securities)

(1) In conducting the public offering of new securities as provided for in Article 2 (3) of the Act, the number of persons who are solicited to subscribe for securities to be issued newly shall be 50 or more.

(3) In calculating the number of 50 persons in paragraphs (1) and (2), the person who has been solicited to subscribe for acquisition or to sell, or to make a solicitation for purchase (hereinafter referred to as the “solicitation for purchase”) within the past six months from the date of solicitation for subscription shall be aggregated with the person who has been solicited to subscribe for the same kind of securities as that for the public offering, without going through a public offering or sale, but excluding

1. Where a shareholder of the issuer and his specially related persons (referring to the specially related persons as prescribed in Article 10-3 (2); hereinafter the same shall apply) possess the largest number of stocks, the shareholder concerned (hereinafter the largest shareholder) and 5/100 or more of the total number of stocks issued;

7. Other persons as having a special relation or an expert who may know well the financial situation or the contents of business, etc. of an issuer as prescribed by the Financial Supervisory Commission.

(b) Relevant legal principles;

In order for a taxation disposition to be null and void as a matter of course, the mere fact that there is an illegal ground for the disposition is insufficient, and its defect must be objectively and objectively in violation of Acts and subordinate statutes, and in determining whether the defect is significant and obvious, the purpose, meaning, function, etc. in the laws and regulations which form the basis for the pertinent taxation should be examined in a teleological perspective as well as reasonable consideration on the specificity of the specific case itself. A taxation disposition conducted by a person who does not have any legal relation or factual relation (income or act) subject to taxation should be serious and obvious, but if there are objective circumstances that make it possible to believe that the legal relation or factual relation which is not subject to taxation is subject to taxation and/or factual relation which are not subject to taxation, it cannot be said that it would be apparent even if the defect is serious, and thus, it cannot be said that the taxation disposition is null and void as a matter of course, which misleads the fact of taxation (see Supreme Court Decision 90Meu10862, Nov. 27, 190).

According to the above facts and the statements of Gap evidence No. 2, the following circumstances are revealed.

① Article 39(1) of the Inheritance Tax and Gift Tax Act provides that if a person who participated in the capital increase by a third party allocation method receives stocks at a lower price than the market price, the profits accrued therefrom shall be deemed as the value of property and taxed thereon. However, since a leCC participated in the capital increase in this case by a third party allocation method and received a allocation at a lower price than the market price, there is an appearance of taxable object, the tax authority was an objective circumstance that may mislead the person as being subject to taxation.

② However, according to the above provision, if the capital increase in this case falls under the case of allocating it by means of public offering of new securities under Article 2(3) of the Securities and Exchange Act, it is not subject to taxation. In order to fall under the method of public offering of new securities, it must meet the requirements of Article 2-4 of the Enforcement Decree of the Securities and Exchange Act. Ultimately, the tax authorities should accurately investigate the facts that the capital increase in this case satisfies the above requirements,

③ In fact, the National Tax Tribunal recognized that BB made solicitation for an offer, such as notifying at least 54 persons of the issuance or sale of securities or providing guidance on the acquisition procedure, and determined that the capital increase was made as a method of public offering of securities, and determined that the capital increase in this case was made as a method of public offering of securities.

In full view of the above circumstances, it is not sufficient to recognize that the defects existing in the instant disposition are serious and clear, solely with the descriptions of Gap evidence Nos. 1, 2, 4, and 10, and there is no other evidence to recognize them. Rather, in full view of the above circumstances, the defects existing in the instant disposition are not serious and clear, and therefore, the said disposition is not null and void.

Ultimately, the plaintiff's assertion is without merit.

4. Conclusion

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