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

A. The plaintiff is an incorporated foundation established on February 2, 1972 for the purpose of missionary work of Islamic bridge and education project necessary for missionary work.

B. According to the result of the normal conference between the Government of the Republic of Korea and the Saudi Arabian Government, the Plaintiff acquired, with the Government of the Republic of Korea’s support, the purpose of establishing Islamic universities in Korea, a total of 430,170 square meters and access road 2.4 km from the Seocho-si, Seocho-si, Seocho-si, an early July 1980.

C. On July 1981, the Plaintiff obtained approval of the establishment plan for the Islamic University of Korea from the Ministry of Culture and Education, but failed to implement support from the Slima Government of Slima, which promised to subsidize construction costs, and the said approval of the establishment plan was invalidated after October 30, 1983, the deadline for application for authorization to establish the Islamic University of Korea.

D. The Plaintiff, who received a donation from the Government of the Republic of Korea, filed a claim for return of the said land from the original owner of the land regarding 5,207 square meters and the access road 2.4 km, and returned the said land in around 1995, thereby owning the total of 374,969 square meters of the said land as the remainder of the construction site (number 1 omitted).

E. From July 19, 1990, the pertinent land was incorporated into a special measures area for the preservation of water sources in arms and legs, and on January 22, 2003, the construction of a building became impossible as it was designated as a green conservation area under the National Land Planning and Utilization Act.

F. On March 16, 2005, the key land was designated as the recreational forest development project site by the designation and public notice of the Korea Forest Service, and on September 16, 2005, the Korea Forest Service paid compensation of KRW 13,485,791,50 to the Plaintiff and acquired the pertinent land by consultation.

G. On December 26, 2007, the Plaintiff purchased and acquired new documents (number 2 omitted) and 285,884 square meters in Gyeonggi-do for the purpose of the establishment site of the Islamic University of Islamic Republic of Korea on December 26, 2007.

H. On October 4, 2010, the Defendant deemed that the Plaintiff’s transfer margin 11,505,255,90 won from the transfer of the pertinent land at the time of acceptance as income accrued from the disposal of fixed assets under Article 3(2)5 of the Corporate Tax Act (amended by Act No. 8141, Dec. 30, 2006; hereinafter the same) and imposed corporate tax of 4,560,695,60 won (including additional tax of 285,879,121 won and additional tax of 1,413,386,374 won from the failure to file a report) on October 4, 2010 (hereinafter “instant disposition”).

I. On December 31, 2010, the Plaintiff filed an appeal with the Tax Tribunal on the instant disposition, but the Tax Tribunal dismissed the Plaintiff’s appeal on August 8, 201.

[Reasons for Recognition] Facts without dispute, Gap's 1 through 3, 4 (including provisional numbers; hereinafter the same shall apply), 7 through 9, Eul's evidence No. 1, and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) Article 2(2) of the Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 19328, Feb. 9, 2006; hereinafter the same) provides that if a nonprofit corporation does not directly use fixed assets for the proper purpose business for three years as of the date of disposal, regardless of the reason for not providing them to the proper purpose business, and the reason for disposing of fixed assets, it is unreasonable to levy corporate tax uniformly if it was not used for the proper purpose business for three years as of the date of disposal. Thus, even if a nonprofit corporation fails to jointly interpret it for the proper purpose business, it shall be deemed to have been used

2) In light of all the circumstances, such as the fact that the construction cost support was not implemented by the Islamic university of Islamic Republic of Korea, the Plaintiff could not use the land for other proper purpose independently, disregarding the agreement between the government of the Republic of Korea and the Saudi Arabian Government, and the subsequent fact that construction was impossible due to the statutory restrictions on the key land, and the Plaintiff was bound to transfer the key land to Gido-si regardless of the Plaintiff’s intent, a land expropriation authority, regardless of the Plaintiff’s intention. Accordingly, there exists a justifiable reason for the Plaintiff’s failure to use the key land for the proper purpose business. Accordingly, the income from the disposal of the key land

3) Even if the Plaintiff is liable to pay corporate tax, there is justifiable ground that the Plaintiff did not report and pay the penalty tax, so the imposition of penalty tax is unlawful.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) As to the principal tax

Article 2(2)5 of the Enforcement Decree of the Corporate Tax Act provides that “justifiable cause” shall be subject to income derived from the disposal of fixed assets as one of the profit-making businesses subject to taxation of a non-profit domestic corporation, and the Presidential Decree is exceptional non-taxation. Article 2(2) of the Enforcement Decree of the Corporate Tax Act provides that “Assets directly used for the proper purpose business for at least three consecutive years as of the date of disposal of fixed assets” shall be subject to non-taxation on disposal income. As such, the statutory provision does not provide for different grounds depending on whether a non-profit corporation is not directly used for the proper purpose business, so it is difficult to consider the existence of a justifiable cause as the applicable standard for the application of Article 2(2) of the Enforcement Decree of the Corporate Tax Act (see Supreme Court Decision 2005Du14370, Jul. 27, 2006). Thus, the Plaintiff’s assertion that the remaining grounds for non-taxation or non-taxation should be determined based on the objective purpose of determining whether a non-profit domestic corporation can be subject to taxation for the same purpose.

2) As to additional tax

Under the Corporate Tax Act, the additional tax on negligent tax returns and additional tax on negligent tax payment are a kind of administrative sanctions imposed when a corporate taxpayer is liable to return a faithful tax base and to pay the tax amount in order to secure the propriety of taxation, and is negligent in fulfilling his/her duties. Such sanctions are not imposed where there is a justifiable reason to believe that it is not unreasonable for a taxpayer to be unaware of his/her duties due to a conflict of views due to a significance in tax law interpretation beyond the scope of simple legal sites or misunderstandings (see, e.g., Supreme Court Decision 2002Du66, Aug. 23, 2002).

The Plaintiff’s failure to report and pay corporate tax due to the transfer of the land at issue is deemed to be merely a legal site or misunderstanding as to Article 2(2) of the Enforcement Decree of the Corporate Tax Act (at the time, the tax authority expressed the view that the taxation authority is subject to taxation). Therefore, it is difficult to deem that there is a justifiable reason that it is not attributable to the Plaintiff’s failure to perform its duties. Accordingly, the Plaintiff’

3. Conclusion

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

[Attachment Form 5]

Judges Lee Jae-hee (Presiding Judge)

1) According to the literal interpretation of Article 2(2) of the Enforcement Decree of the Corporate Tax Act, the Plaintiff asserts that there is an unreasonable result that even if the Plaintiff continues to use the fixed assets for the proper purpose business after the acquisition of them, and disposes of them without a three-year period of time due to non-voluntary reasons such as expropriation, and that there is an unreasonable reason that the Plaintiff should deny non-taxation benefits if they are used for the proper purpose business, regardless of the intended purpose business within the country after the acquisition and use them for 3 years as of the date of disposal. However, taking the non-taxation standard as to whether they have been used for the proper purpose business for 3 years as of the time of disposal of the fixed assets as of the time of disposal of the fixed assets, it is necessary to apply uniformly within the scope of 3-year period, and therefore, it is difficult to view the above provision as unconstitutional or unlawful in light of the above principles of superior laws or equality, even if the above provision does not seem to be legitimate in determining the scope of assets directly used for the proper purpose business.

2) The Plaintiff asserts that, in applying Article 2(2) of the Enforcement Decree of the Corporate Tax Act, just cause should be considered in the case of imposing corporate tax on revaluation spread when a corporation which conducted asset revaluation fails to list its stocks within the deadline prescribed by law, etc., Supreme Court Decision 94Nu4141 Decided September 13, 1994; Supreme Court Decision 2009Du3842 Decided April 18, 201, which states that, in the event that corporate tax on revaluation spread is imposed, just cause should be considered. However, the Plaintiff asserts that, on the premise that the requirements should be met for a certain period of time in the future, the Plaintiff’s assertion is related to the deprivation of the right to acquire taxes after focusing on the behavior of taxpayers, who did not meet such requirements, and then deprived of the right to acquire taxes and converting them into taxation. Therefore, it is difficult to view that the above provision of the Enforcement Decree of the Corporate Tax Act should be the same as the above criteria for determining whether to use the relevant assets for a certain period of time without a taxpayer’s future behavior.