Chuncheon District Court 2008Guhap1885 ( October 16, 2009)

Reduction of or exemption from capital gains tax for farmland substitute land

It is difficult to regard it as a direct self-confiscing in view of the fact that he was directly engaged in cargo transportation business.

The contents of the decision shall be the same as attached.

1. The plaintiff's appeal is dismissed.

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

Purport of claim and appeal

The judgment of the first instance shall be revoked. The defendant's disposition of imposition of capital gains tax of KRW 303,008,940 against the plaintiff on April 7, 2008 shall be revoked.

1. Circumstances of the disposition;

A. On March 7, 2002, the Plaintiff: (a) on March 7, 2002, the Plaintiff: (b) on the same 70-1 780 m2; (c) 780-1 m2; (d) 972 m2; (e) 780-4 m2; (e) 780-5 m27; (e) 780-27 m27; (f) 780-27 m27; (c) 780-27 m27 m27; (d) 104 m27 m28-28 m27 m24; and (e) on the same 1043 m28 m27 m27 m2; and (e) on March 4, 2005, the Plaintiff was a gift of the same m27 m25 m27 m25 m2.

B. On May 7, 2007, the Plaintiff filed a preliminary return on the transfer income tax for the transfer of each of the instant lands to the Defendant on May 7, 2007, on the ground that the transfer of each of the instant lands falls under the reduction or exemption of the transfer income tax, on the ground that the transfer of each of the instant lands constitutes the income generated from the substitute land for the farmland under Article 70(1) and Article 133(1) of the former Restriction of Special Taxation Act (amended by Act No. 8827, Dec. 31, 2007; hereinafter the same shall apply) and Article 67(1)1, (2), and (3)1 (a) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 20620, Feb. 22, 2008; hereinafter the same shall apply) by deducting KRW 100,522,310,000, which is the maximum reduction or exemption limit, from the tax amount calculated under the relevant provisions of the Income Tax Act.

C. However, the Defendant calculated capital gains tax without tax reduction or exemption under the former Restriction of Special Taxation Act on the ground that the Plaintiff did not directly cultivate each of the instant land. On April 7, 2008, the Defendant issued a disposition of imposition (hereinafter “instant disposition”) by correcting capital gains tax on each of the instant land as KRW 303,008,940 to the Plaintiff.

D. On June 16, 2008, the Plaintiff appealed to the Defendant, but was dismissed on July 11, 2008, and again filed an appeal with the Tax Tribunal on August 29, 2008, but the decision of dismissal was rendered on December 5, 2008.

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, and 4 each; Gap evidence 3; Eul evidence 1-1; Eul evidence 5-1 through 3; Eul evidence 6-1 through 10; and the purport of the whole pleadings

2. Whether the dispositions of the instant case are legal.

A. The plaintiff's principal

(1) The Plaintiff had been engaged in the business of wholesale business, cargo transportation business, private taxi driving, etc., while residing in the original state, which is the location of each land of this case. The Plaintiff donated each land of this case to HongA, the father of the Plaintiff, and directly cultivated the land of this case every day on which the Plaintiff’s work is easy. If it is impossible to do so on his own, he paid the Plaintiff’s assistance of RedE, or the price for the use of agricultural machinery equipment to the Gu FF, HanG, etc., which is a resident of the village, and directly cultivated the Gu HH, HanG, etc. by 206 by allowing the Gu H, HanG, etc. to cultivate the land of this case by using the agricultural machinery equipment on March 5, 2007, instead of selling each of the land of this case, the Plaintiff purchased DNA land of this case, the total area of which exceeds 5,189 square meters.

(2) Therefore, the income earned by the Plaintiff through the transfer of each of the instant lands constitutes “income generated from substitute land for farmland” under Article 70(1) of the former Restriction of Special Taxation Act and falls under the reduction or exemption of capital gains tax, and thus, the instant disposition issued on a different premise is unlawful.

(b) Related statutes;

It is as shown in the attached Form.

C. Determination

(1) Article 70(1) of the former Restriction of Special Taxation Act provides that capital gains tax reduction and exemption provisions for substitute land for farmland under Article 70(1) of the same Act shall apply to income generated from substitute land for farmland that is directly cultivated by a resident in the seat of farmland and prescribed by the Presidential Decree due to the necessity of cultivation. Therefore, the Plaintiff’s above assertion is premised on the direct cultivation of each land

(2) On the other hand, Article 67 (2) of the former Enforcement Decree of the Restriction of Special Taxation Act provides that "a resident is engaged in cultivating crops or growing perennial plants on his own farmland or growing or growing them with his own labor" with regard to the meaning of "direct farming" under Article 70 (1) of the former Enforcement Decree of the same Act. The fact that a resident directly cultivated the transferred land must be proved by the claimant actively, and even if it is recognized that the transferred land has been used as farmland for several years, it is not presumed that the transferor has done his own discretion (see, e.g., Supreme Court Decisions 87Nu402, Oct. 13, 1987; 94Nu996, Oct. 21, 1994).

(3) Therefore, it is difficult to believe in light of the following: Gap's evidence Nos. 9, 10, Gap's evidence Nos. 11-1, 11-1, each evidence Nos. 11-1 through 10, and the testimony of HongK, GuF, and HanGG for the first instance trial as to whether the plaintiff cultivated the land of this case directly within the above meaning, and the plaintiff's testimony of this case appears to have a relationship or a relationship between the plaintiff and the witness of the first instance trial, and the old F and HanG failed to accurately state the particulars paid for the use of farming machinery equipment from the plaintiff at the time of testimony of the first instance trial, and there is no evidence to acknowledge it, and there is no other evidence to acknowledge it.

(4) Rather, comprehensively taking account of the following circumstances, Eul's evidence 1, 2, and Eul's evidence 2 and 3's evidence 9 and the fact-finding on the head of the first instance court's original city, ① the plaintiff worked in food companies, city bus companies, etc. or engaged in cargo transportation business from May 1, 1993 to March 200, and up to May 200, the plaintiff is driving private taxi. Thus, under the above circumstances, even if the plaintiff were to receive some of others' assistance, it is difficult to view the plaintiff's land as being 5,189 square meters in total (the total area of the donation and inheritance of this case is 5,583 square meters, and the plaintiff's land was 70 square meters in total to 70 square meters in total, or 80 square meters in total, and the plaintiff's farmland was 5,580 square meters in total and 700 square meters in each of the above land.

(5) Therefore, the Plaintiff’s above assertion is not reasonable, and thus, the instant disposition is lawful.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and the judgment of the court of first instance is just, and the plaintiff's appeal is dismissed as it is without merit. It is so decided as per Disposition.