Article 51 (Calculation of Gross Income Amount)

2. Litigation costs shall be borne by the plaintiff.

A. On June 1, 2002, in order to operate a real estate trading business, the Plaintiff and Kim Jong-ho (hereinafter referred to as the “Plaintiff, etc.”) jointly registered a business on June 1, 2002. On August 9, 2002, the Plaintiff purchased 856-○○○-dong 856-○ 1,494.7 square meters on the above land on the above ground, and newly constructed a commercial building (a total floor area of 13,730.18 square meters, a store number of 62 square meters; hereinafter referred to as the “building in this case”) with each co-owned share of 1/3 on July 25, 2003, and completed the registration of preservation of ownership on the above building. However, unlike the share in ownership preservation, the actual share ratio of the Plaintiff, etc. on the real real estate trading business is Plaintiff 20%, Kim Jong-ho, and 40%, respectively.

B. Until August 8, 2003, the Plaintiff et al. reported global income tax for the year 2003 with the total value of KRW 8,638,440,000 as follows, with the exception of 19 stores sold in lots and 1 stores unsold in lots (hereinafter “instant store”).

C. From March 20, 2006 to June 9, 2006, the director of the Central Regional Tax Office reported that the value of the store of this case at the time of division of this case was KRW 11,861,041,00, which is the appraised amount by ○○○ Certified Public Accountants Co., Ltd., but was KRW 8,638,440,000, and omitted sales. Thus, the Plaintiff et al. reported that the amount of appraisal and the reported amount was 3,221,60,000, which is the difference between the appraised amount and the reported amount, and notified the Defendant of the taxation data.

D. Based on the above notified data, the Defendant corrected and notified the Plaintiff of KRW 145,360,000 global income tax for the year 2003 (hereinafter the instant disposition)

E. The plaintiff appealed and filed an appeal with the National Tax Tribunal on October 23, 2006. The National Tax Tribunal dismissed the plaintiff's appeal on February 4, 2008.

[Ground of recognition] Facts without dispute, Gap 1, 2, 4 evidence, Eul 1 evidence, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

(1) "Where inventory assets are consumed by provisional use" under Article 25 (2) of the Income Tax Act refers to cases where inventory assets are consumed by themselves without using them for business purposes any more. The Plaintiff et al. is merely an individual transfer of the name on the registry of the instant store in order to obtain loans from the Plaintiff et al., and the said store still continues to be sold after the instant division. Thus, the instant division does not constitute a provisional consumption of inventory assets.

(2) Even if it is recognized as taxable subject to the division of this case, the "amount equivalent to the value stipulated in Article 25 (2) of the Income Tax Act" means, in principle, the value of the appraisal corporation only when the market price is meaningful and the market price is unclear. Since the ○○○ Committee, which is almost similar to the price reported by the Plaintiff, etc., sold in lots after the division of this case, since the 20 stores and the building adjacent to the building of this case and the building of this case, and the building of this case, the size, size, and the new construction period are almost similar, each of the above sales prices of this case (this is almost similar to the price reported by the Plaintiff, etc.) should be deemed as the market price of the store of this case. Nevertheless, the disposition of this case was unlawful, premised on the "amount equivalent to the value equivalent to the "value stipulated in Article 25 (2) of the Income Tax Act" of this case.

(b) Related statutes;

Article 25 (Special Cases of Calculation of Gross Income Amount)

Article 51 (Calculation of Gross Income Amount)

(c) Fact of recognition;

(1) On August 20, 2003, the Plaintiff et al. requested an appraisal by ○○ Certified Public Accountants Corporation to obtain a loan from ○○○○○ Association. The appraisal value of the instant store is as indicated in the attached Table 1.

(2) 20 out of the instant stores were sold after the instant subdivision, and the date of sale and the sale price are as stated in the attached Table 1.

(3) Goyang-si ○○○○○○○○○○ Building on the ground of 856 ○○○○-dong 856 adjoining to the instant building, and the instant building and its height, and the timing of new construction are similar thereto. The details of sale of the said building submitted by the Plaintiff are as indicated in the second list.

(4) On August 8, 2003, the date of the instant division, the Plaintiff filed a registration of real estate rental business with nine stores, the ownership of which was completed in its name, among the instant stores, and filed a return of value-added tax by deeming the acquisition of the said store as the purchase of fixed assets.

[Ground of recognition] Facts without dispute, Gap 2, 3, 7, 8 evidence, Eul 2-10 evidence (including each number), the purport of the whole pleadings

D. Determination

(1) Whether the division of this case constitutes "provisional consumption"

(A) Article 25 (2) of the Income Tax Act provides that when a resident consumes inventory assets by temporarily using them, the amount equivalent to the value when he consumes them shall be included in the total amount of income in calculating the business income, the amount of other income, or forest income for the year in which such date belongs. The term "provisional use" refers to the direct use of inventory assets for personal purposes regardless of the business. As to part of a commercial building newly constructed by a joint businessman for the purpose of sale, the sole possession of a joint businessman by organizing only mutual shares among the joint businessmen is different from the actual use of part of a newly constructed building by the joint businessman (see Supreme Court Decision 2000Du2068, Sept. 18, 2001). Thus, it constitutes "provisional use of inventory assets" under Article 25 (2) of the Income Tax Act.

(B) As seen earlier, as to the instant case, since the Plaintiff’s business is to jointly construct and sell the instant building, and the 10 low-scale stores among them are newly constructed and sold, and the registration of ownership transfer is completed by dividing the instant stores into their respective shares, it is reasonable to deem that the Plaintiff, etc. consumed the instant stores as inventory assets for provisional use. As above, the Plaintiff’s joint business is discontinued (the Plaintiff has registered the Plaintiff’s sole name with the purpose of real estate rental business using the store that completed the registration of ownership transfer on the date of the instant division as its own name as its business place) and completed the registration of ownership transfer as the sole ownership of the Plaintiff, etc., as long as the economic profit and loss on the divided stores belongs to the sole owner, so it does not change even if the Plaintiff, etc. sold the instant stores while carrying on their own business after the instant division, and the Plaintiff, etc. sold them (as to this case, the instant division is merely the transfer of the simple name, but the Plaintiff’s assertion that the Plaintiff’s registration of ownership transfer or division was made after the Plaintiff’s report of ownership transfer amount.

(2) The value at the time of the instant division of the instant store

(A) According to Article 25(2) of the Income Tax Act, Articles 53(9) and 51(5)5 of the Enforcement Decree of the same Act, Article 22-2 of the Enforcement Rule of the same Act, and Article 89(1) and (2) of the Enforcement Decree of the Corporate Tax Act, “the amount equivalent to the value at the time of consumption” when a resident consumes inventory assets by temporarily using them, means the value at the market price, namely, in a situation similar to the transaction in question, if there is a transaction price continuously traded with many and unspecified persons other than a person with a special relationship or a general transaction price between a third party who is not a person with a special relationship. If the market price is unclear, it means the value appraised by an appraisal corporation under the Act on Publication of Land Prices

(B) First, as to whether there exists a market price at the time of the division of the instant store, the commercial building has a strong impact on various location conditions, such as the location, structure, number of stores, traffic conditions, etc. Therefore, there may be a big difference in the above location conditions, even if there is a significant difference in the price. Even if the same is located on the same floor of the building, there may also be a big difference in the price for each shop. In addition, Article 25(2) of the Income Tax Act provides that the amount equivalent to the value of "when the inventory assets are consumed for provisional use" shall be included in the total income. The appraisal of the instant store is made on August 20, 203, which is after the date of the division of this case (the date of August 8, 2003), while most of the stores sold after the division of this case were sold at the end of 203 or 204, the market price at the time of the division of this case cannot be seen as the market price at the time of the sale of this case.

(C) Next, it is reasonable to view that the Defendant assessed the above appraisal value as "amount equivalent to the value when the inventory value was consumed by provisional use" in the store of this case as "amount equivalent to the value when the inventory value was consumed by the provisional use of the inventory value," and that the appraisal corporation assessed in accordance with objective and reasonable standards and methods, barring special circumstances, as a public trust institution (in case of false appraisal, it shall be subject to criminal punishment). The Plaintiff asserted that the above appraisal value was excessively unrefilled, and the Plaintiff submitted only the data that the above appraisal value was higher than the actual sale price or the neighboring commercial building's sale price after the division of this case. In addition, it is difficult to deem that the method of calculating the above appraisal value was unreasonable and appropriate because some of the above appraisal values did not comply with the standards of appraisal under the relevant provisions, such as the Public Notice of Values and Appraisal of Lands, etc. of Lands and Appraisal of Lands, etc., and there is no assertion and certification as to the specific grounds for which the above appraisal value is not reliable.

(3) Sub-decisions

Therefore, the instant disposition is lawful on the premise of the amount equivalent to the value at the time of consuming the appraisal value of the instant store for provisional consumption under Article 25(2) of the Income Tax Act.

3. Conclusion

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