2. The plaintiff's remaining appeal is dismissed.

3. The total costs of the lawsuit shall be three minutes, and two of them shall be borne by the Plaintiff, and the remainder by the Defendant, respectively.

The following facts are not disputed between the parties, or can be acknowledged in full view of the purport of the whole pleadings in each entry in Gap evidence 1-1-4, Eul evidence 1-2, Eul evidence 2-1-4, Eul evidence 3-2, Eul evidence 4, Eul evidence 5-1, 2, and 3.

A. During the period from September 2, 2000 to December 4, 2000, the Plaintiff acquired non-listed stocks of a stock company 000 (hereinafter “foreign company”) as follows.

(1) 12,797 shares for purchase from 00 September 2, 200 to 12,797 shares for purchase (hereinafter referred to as 'first shares') (2) 50,316 shares for purchase from 00 shares for the same day (hereinafter referred to as ' second shares')

(3) 28,704 share capital increase without compensation on October 25, 200 (hereinafter referred to as "third share")

(4) 12,869 shares due to the increase of capital for a consideration on October 26, 2000 (hereinafter referred to as "fourth shares").

(5) 51,589 shares (hereinafter referred to as "5 shares") due to capital increase without compensation on December 4, 2000

B. The defendant deemed that the plaintiff actually purchased or took over shares of this case 1 through 5 (hereinafter referred to as "the shares of this case") and received title trust from Park 00, which is a major shareholder of the non-party company, pursuant to Article 41-2 (1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 6301 of Dec. 29, 200, hereinafter referred to as the "former Inheritance Tax and Gift Tax Act"), and deemed that the value of the shares of this case was donated from Park 00 pursuant to Article 41-2 (1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 6301 of Dec. 29, 200; hereinafter referred to as the "former Inheritance Tax and Gift Tax Act"), the value of the shares of this case shall be assessed as stated in the following disposal list according to the supplementary evaluation method under the former Inheritance Tax and Gift Tax Act, and on March 1, 2004, the amount of the shares of this case shall be reduced to 9, 3650, 36369, 4570

calendar in the part of the Corporation; and

No.

Date of Change

Grounds for change

Number of Stocks

per share

Values

Property

Values

Amount of gift tax

1

September 2, 2000

Purchasing(00)

12,797

16,448

7,349,382,624

4,500,567,830

2

〃 4

Purchase (00)

50,316

3

10.25

Free capital increase;

28,704

66,910

1,920,584,640

1,325,348,360

4

. 10.26

Paid-in capital

12,869

66,910

861,064,790

594,926,010

5

12.4.

Free capital increase;

51,589

42,930

2,214,715,770

1,533,797,060

guidance.

156,275

12,345,747,824

7,954,639,260

2. Whether the disposition is lawful;

A. The plaintiff's assertion

The Plaintiff asserts that the instant disposition should be revoked as it is unlawful for the following reasons.

(1) The Plaintiff purchased shares Nos. 1 and 2 from 00 and 00 on September 2, 200 to 7,000 won per share, and normally acquired the money borrowed from a financial institution to pay the amount in full. Accordingly, the Plaintiff acquired shares Nos. 3, 4, and 5 with no charge or capital increase. Accordingly, the instant shares are owned by the Plaintiff and do not actually undergo title trust from 00.

(2) Even if a title trust was received, it cannot be deemed that there was a purpose of evading gift tax in light of the purport of the Supreme Court Decision 92Nu10685 Decided March 23, 1993, since the Plaintiff did not exercise a real authority over the instant shares.

(3) The instant disposition erroneously assessed the value of the instant shares as follows (the assessed value per share shall be see the column corresponding to the said disposition statement).

(A) At the time of the mediation of the case of 000Na000, the related case, the non-party company's shares were assessed to 27,000 won per share. Thus, the above value is assessed to the market price of the shares of this case, or as a result of the market price entrustment to the corporation of 000 at the court of first instance, the value per share of the shares of this case was assessed to 32,854 won at the time of September 2, 2000, 29, 29,422 won at the time of October 25, 200, and 28,781 won at the time of October 26, 200, and 27,031 won at the time of December 4, 200, such value shall be deemed to be the market price of the shares of this case.

(B) In order to pay the amount of tax in accordance with the instant disposition, the Plaintiff paid the entire stocks subject to taxation in kind to the Defendant, which are insufficient to pay the amount of tax. The instant disposition applying the supplementary assessment method was an infringement on the Plaintiff’s property right, etc. guaranteed by the Constitution by assessing the value of the stocks in question considerably above

(C) On October 25, 200, the non-party company increased the total number of existing shares from 1,380,530 to 2,04,530 shares by capital increase without compensation. Despite the decline in the value of old shares that corresponds to the number of shares increased upon issuance of free shares, the defendant assessed the value of the shares based on 1,380,530 shares, which are the total number of existing shares.

(D) The Defendant assessed the shares of this case on the basis of the premium under Article 63(3) of the former Inheritance Tax and Gift Tax Act. However, the assessment of the premium on the ground that there is a special relationship with the largest shareholder is contrary to the principle of equal rights and the guarantee of property rights under the Constitution.

(4) Since the capitalizing of revaluation reserve by a person who is the cause of acquiring 3 and 5 shares is due to the capitalizing of revaluation reserve, the number of stocks is increased by simple division without any change in the value of the existing shares, the taxation of the 3 and 5 shares out of the instant disposition is unlawful as double taxation.

(5) If the amount of the share price for the 4th share that was acquired through the offering of new shares is not the Plaintiff’s money, the Plaintiff is a donation of KRW 64,345,00, not the 4th share price itself, and thus, it is unlawful to deem that the 4th share price was donated.

(b) Fact of recognition;

Each of the above evidence and evidence Nos. 3-1, 2, 14, 6-1, 7-1 of evidence Nos. 6, and 7-1 of evidence Nos. 3-1, 2, 14, and 7 of the court of first instance shall be acknowledged in full view of the whole purport of the arguments.

(1) As of the end of 1999, 00 shares were held in the name of the non-party company as joint representative director, and 50,316 shares were held in the name of 636,244 shares, and 00 shares were held in the name of 50,316 shares under the name of 609,963 shares, and 76,597 shares were held in the name of 600 shares under the name of 609,963 shares. However, as of the end of 199 of the non-party company, 1,386,085 shares were held in the name of 1,386,08 shares and the status of the shareholders are as follows

100 636,244 Shares, 50,316

Total 686,560 Shares (49.53%)

(2) Park 00 609,963, 00 76,597 shares

Total 686,560 Shares (49.53%)

3 7,254 Shares, Kim0 2,277 Shares, Kim0 3,434 Shares

Total 12,965 Shares (0.94%)

(2) On the other hand, on November 30, 200, 000 and 00 transferred the above stocks held in their names to the Defendant and 00 won per share as follows, if they were to transfer the above stocks held in their names to the Plaintiff and 00 won per share, they reported and paid the capital gains tax accordingly, and 00 children are 0.

① Each transfer to the Plaintiff on September 2, 200 12,797 (Share 1) and 63,800 shares to the Plaintiff on September 2, 200

② Assignment of 50,316 Shares (No. 2 Shares) to the Plaintiff on the same day.

(3) Of 00 shares, 00 shares 13,484 shares owned by 00 were accepted, and in 00 shares were donated to 00 shares owned by 13,484 shares, and in the case of 00, 63,800 shares out of 00 shares were transferred to 00 shares out of 00 shares to 12,797 shares and 50,316 shares of 00 shares were transferred to 12,316 shares out of 00 shares, as seen earlier, to the Plaintiff.

(4) On August 31, 200, the Plaintiff deposited 5100 million won in the same account under the Plaintiff’s name with a loan of 00 million won under the joint and several sureties’s joint and several sureties’s 00 bank and transferred 0000 points (number: 00-00-000) under the name of the Plaintiff’s transfer price to the same account (number: 00-00-00) under the name of the Plaintiff’s transfer price. From August 31, 2000 to 300 million joint and several sureties’s loan from 000 to the same account under the name of 00 bank under the name of transfer price, the Plaintiff deposited 00 bank under the name of 00 bank under the name of 00 bank (number: 00-00-000-000). In particular, the account was opened under the name of 160 days and 200-4 days of transfer price.

(5) Meanwhile, as at the time of each of the above loans, this 00 had been staying in a foreign country and could not directly participate in the above loans, the interest accrued from each of the above loans was transferred by the non-party company or deposited by its employees. The 00 or 00 did not use the money deposited in each of the above accounts, and was nearly withdrawn in cash and deposited into the account of the non-party company's director or affiliate. At the end of 1999, the property other than the financial property owned by the plaintiff or his family was only 10 million won in fake apartment.

(6) Thereafter, the non-party company acquired 12,965 shares in total of 00,00,000,000 won for capital increase without compensation on October 25, 2000 (624,000 shares), 1.4 billion won for capital increase on October 26, 200, 37 billion won for capital increase on December 4, 200, and 5.6 billion won for capital increase on December 4, 200, and 5.4 billion won for capital increase (1,122,80 shares) for capital increase on December 3, 200, the non-party company acquired 3,4, and 50 million won for capital increase on December 4, 200. In the process, the plaintiff acquired 3,4, and 5 shares for capital increase, each of the above gratuitous holders acquired 8.734,446,80 shares for new shares by issuing the shares increase in proportion to the shares of shareholders.

(7) As of the end of 2000, the total number of shares issued by the non-party company is 3,400,000 shares and its shareholders are as follows.

100 1,575,412 Shares, 157,976 Shares

Total 1,733,388 Shares (50.98%)

② Park 00 1,510,337 Shares, Plaintiffs 156,275 Shares

Total 1,666,612 Shares (49.02%)

(8) As a result of the tax investigation regarding the change in the ownership of the instant shares, the Defendant: (a) deemed that Park 00 held a title trust with 00 shares as above, but that the title trustee was changed to the Plaintiff; and (b) held the instant disposition against the Plaintiff in accordance with the statutory provision on the constructive gift of title trust property; (c) deemed that the instant shares as non-listed shares cannot be calculated as the market price; and (d) calculated the value per share, such as a statement in the assessment column for each share on

(9) 00 accounting firms entrusted with the appraisal by the court of first instance shall assess the value of the instant stocks as KRW 32,854 as of September 2, 200, KRW 29, KRW 29,422 as of October 25, 200, KRW 28,781 as of October 26, 200, KRW 2781 as of October 26, 200, and KRW 27,031 as of December 4, 200 as of December 4, 200, according to the method of appraisal under the Securities Issuance and Public Disclosure Act and the detailed method of appraisal under the enforcement rules.

(10) In order to pay the tax amount under the instant disposition, the Plaintiff paid the instant shares in kind, and the assessed amount of the said payment in kind is below the total tax amount per share (39,800 won per share in case of stocks 1, 2, 37,634 won per share, 39,800 won in case of stocks 3, 44,899 won per share in case of stocks 4,99 won in case of stocks 42,930 won per share in case of stocks 5) and paid the shortage in cash.

C. Determination

(1) As to the assertion that title trust was not obtained from Park 00

As can be seen from the above facts, in full view of the circumstances such as the equity ratio of the non-party company and its change, the details of entry and withdrawal of each account in 00 and 00 shares, the acquisition of the shares and the flow of the purchase price thereof, and the Plaintiff’s asset status, etc., the 00 shares were transferred to the non-party company 76,597 shares to the non-party 00, but the title trustee transferred 13,484 shares to the non-party 00, while the title trustee was to change from 00 to the Plaintiff, the 63,800 shares out of the shares held in 00 shares to the non-party company 12,797 shares in 0 and 12,797 shares in 00 shares, and the Plaintiff’s shares held in 00 shares and 50,316 shares in 00 shares were transferred to the Plaintiff without compensation. Thus, the Plaintiff’s assertion that the title trust was transferred to the non-party 100 shares.

(2) As to the assertion that there is no purpose of gift tax avoidance

According to the relevant Acts and subordinate statutes, if property is registered under another person’s name, it shall be presumed that the purpose of tax avoidance exists, and the nominal owner appears to have donated the value of the property to the actual owner on the date of registration, etc. (Article 41-2(1) and (2) of the former Inheritance Tax and Gift Tax Act). The burden of proof as to the absence of such purpose of tax avoidance lies on the part of the assertion. However, there is no evidence to deem that there was no purpose of tax avoidance in this case (the judgment required by the Plaintiff is different from the applicable Acts and subordinate statutes, and it is inappropriate to be invoked in

(3) As to the assertion that the value of the instant shares was erroneously assessed

(A) According to Articles 60(1), 60(2), 63(3), and 63(1)1(c) of the former Inheritance Tax and Gift Tax Act and Article 49(1)2 of the former Enforcement Decree, the value of the property subject to gift tax shall be the market value as of the date of donation. In this case, the market value shall be the value deemed ordinarily established when free transactions are conducted between many and unspecified persons. This includes the average value of the appraisal value assessed by two or more appraisal agencies for the pertinent property during the period of not more than three months before and after the base date of appraisal. However, in cases where it is difficult to calculate such market value, it shall be based on the value assessed by supplementary assessment methods as stipulated by law, considering the type, size, transaction

In full view of the purport of the argument in Gap evidence No. 4, the conciliation was concluded on April 28, 1998 between the parties in the damages claim No. 000,000, which was filed by Lee 00, a shareholder of the non-party company against Lee 00,000, etc., and the value per share of the non-party company was assessed as KRW 27,000,000, but it is recognized that the price per share in the above case was formed by mutual concession to resolve the dispute smoothly between the parties, and thus, it cannot be viewed as a normal amount established if a trade is made freely between many and unspecified persons.

Meanwhile, as seen above, “market price” means, in principle, an objective exchange price formed through free and normal transactions between many and unspecified persons. However, since the concept includes the value appraised in an objective and reasonable manner, it can be seen as the market price if there is a reliable appraisal institution’s appraisal value reflecting such objective exchange value. However, 00 accounting corporation requested to appraise the market price of the shares of this case by the court of first instance, according to the above provision and the evaluation methods under its enforcement rules, calculated the value of the shares of this case by calculating the average of the value of the shares of this case by comparing and assessing the value of the shares of this case by 1:1.5 percent of the company’s own price similar to the shares of this case. Since the above provision was enacted on December 29, 200 after the Plaintiff’s acquisition of shares of this case based on the Securities and Exchange Act, it is more reasonable to apply the above appraisal value to the company from 00 years to 10 years to 20 years to 10 years to 20 years to 10 years to 5 years to 5 years to 10 years to 5.

(B) Even if the amount of assessment at the time of the tax assessment and the amount of assessment at the time of the tax assessment are different in cases where a substitute payment is made for a taxable object, the circumstances such as the assessment method cannot be deemed unreasonable, as long as the provisions on the assessment method are different, and the assessment amount based on the payment in kind is not less than the taxable value of the tax assessment, are merely different from the circumstances that can be different in relation to the payment in kind.

(다) 관계 법령의 규정에 의하면, 비상장주식의 가액은 보충적 평가방법을 적용할 경우, "1주당 최근 3년간의 순손익액의 가중평균액 ÷ 금융시장에서 형성되는 평균이자율을 참작하여 재정경제부령이 정하는 율(이하 '순손익가치'라 한다)"과 "당해법인의 순자산가액 ÷ 발행주식총수(이하 '순자산가치'라 한다)" 중 높은 금액으로 평가하도록 되어 있고(구 상속세및증여세법 시행령 제54조 제1항, 제2항), 위 1주당 최근 3년간의 순손익액의 가중평균액은 "｛(증여일 전 1년이 되는 사업연도의 1주당 순손익액X3) ＋ (증여일 전 2년이 되는 사업연도의 1주당 순손익액X2) ＋ (증여일 전 3년이 되는 사업연도의 1주당 순손익액X1)｝X 1/6"의 산식에 의해 산출하며(같은 법 시행령 제56조 제1항), 여기서 각 사업연도의 주식수는 각 사업연도 종료일 현재의 발행주식총수에 의하되, 다만, 평가기준일이 속하는 사업연도 전 3년 이내에 무상증자를 한 사실이 있는 경우에는 무상증자 전의 각 사업연도 종료일 현재의 발행주식총수를, "무상증자전 각 사업연도말 주식수 X (무상증자직전 사업연도말 주식수＋무상증자 주식수)/무상증자직전 사업연도말 주식수"의 산식에 의한 환산주식수에 의하여 계산하도록 되어 있다(같은법 시행령 제56조 제2항, 같은법 시행규칙 제17조의3 제5항 제1호).

According to the evidence Nos. 9-1, 2, and 3, the defendant calculated the number of shares converted to the free capital in 1997 through 1999 in accordance with the above formula in assessing the value of the shares of this case. Based on such formula, it is found that the defendant calculated the weighted average amount of net profit and loss for the last three years per share and assessed the higher amount of the above amount as the value of the shares of this case after calculating the net asset value per share for the last three years, and thus, it cannot be deemed that the defendant has assessed the higher amount as the value of the shares of

(D) Generally, stocks, etc. are merely representing the value of assets and profit values of a stock company, etc. divided into shares. However, the shares, etc. held by the largest shareholder, etc. have special value that can exercise management rights or control rights of the company in addition to their value, so-called "management rights", and a fair evaluation method for fair taxation in order to prevent the transfer of such shares, etc. without legitimate tax imposition. It is the legislative purpose of Article 63(3) of the Inheritance Tax and Gift Tax Act, which provides for evaluation of shares, etc. of the largest shareholder, etc... Accordingly, the above legal provision can be deemed to have been determined by taking into account the demand for realization of tax justice through fair tax burden, tax policy and technological demands such as tax efficiency, and the legislative purpose thereof, and it cannot be deemed to have violated the principle of equality or infringement of property rights by discriminating against the general shareholders in light of its legislative purpose (see, e.g., Constitutional Court en banc Decision 203Hun-Ba6, May 26, 2003).

(E) Therefore, the Plaintiff’s assertion on this part is without merit.

(4) As seen earlier, the Plaintiff acquired 3 and 5 stocks due to the capital increase of the non-party company’s assets revaluation reserve without compensation. The assets revaluation reserve under the Assets Revaluation Act can be disposed of only at the time of offsetting the amount on the balance sheet, which occurred after the date of capital transfer or revaluation, or on the exchange rate adjustment account. Unlike surplus capital transfer, the capital transfer is merely an increase in the net assets of the company, but merely an increase in the amount by revaluated the assets already appraised from the reserve account to the capital account at a different time. Thus, there is no change in the economic substance of the assets subject to evaluation. In this regard, even if the capital increase was made without compensation, since the existing shareholder did not make new investments in the company, and thus, it is merely a substantial division of the existing stocks without a net increase in assets (in this respect, the Income Tax Act does not impose income tax on the value of stocks or investments acquired by the shareholders by transferring revaluation reserve funds to the capital pursuant to the Assets Revaluation Act).

Meanwhile, even if the provision on the presumption of gift under Article 41-2(1) of the former Inheritance Tax and Gift Tax Act is an exception to the substance over form principle, as long as the title truster imposes gift tax on the title truster on the title truster, the title truster shall be presumed to have been the subject of taxation as a taxation requirement. According to the above, the 3 and 5 shares are actually divided into the existing shares and distributed to the existing shareholders according to the ratio of shares, as the assets revaluation reserve already reflected in the value of the existing shares in the capital of the non-party company is modified to the item as capital, and it cannot be deemed that the 1 and 2 shares, which are the former shares entrusted under the title truster, are actually divided into the existing shares, and it cannot be deemed that the title trust was made separately from the shares already trusted to the plaintiff who is the title truster under the title truster 0. Thus, the Defendant’s imposition of gift tax on the plaintiff on the grounds of the title trust on the 3 and 5 shares is unlawful in violation of the substance over form principle (see, e.g., Supreme Court Decision 2004Du1206).

(5) As to the assertion that the share acquisition price was donated to the 4th share shares

As seen earlier, inasmuch as it is deemed that Park 1 and 2 shares were held in title trust to the Plaintiff, it is reasonable to deem that Park 00 acquired the shares with its own funds and held the title in title trust to the Plaintiff, even in the case of the 4 shares that the Plaintiff acquired with capital increase with its own funds. As such, the Plaintiff’s assertion is without merit.

3. Conclusion

Therefore, each disposition of gift tax of KRW 1,533,797,060 on shares of KRW 1,326,348,360 on shares of KRW 30 and KRW 50 on shares of KRW 1,533,79,060 on the disposition of this case shall be revoked. Thus, the plaintiff's claim shall be accepted within the scope of the above recognition, and the remainder of the claim shall be dismissed as it is without merit. Since the judgment of the court of first instance is unfair in some different conclusions, the part against the plaintiff falling under the part against which the order of revocation is issued in the judgment of the court of first instance shall be revoked, and the remaining appeal of