Seoul Administrative Court 2006Guhap21283 ( October 31, 2007)

National High Court Decision 2004No4212 (Law No. 17, 2006)

Scope of proof that there was no purpose of tax avoidance

It should be proved by objective and correct evidence that the nominal owner had no objective of tax avoidance in the title trust, that the nominal owner has a clear objective of tax avoidance to the extent that it is recognized that there was no objective of tax avoidance, and that there was no tax avoidance in the future at the time of the title trust or in the future.

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

Article 45-2 (Presumption of Donation of Title Trust Property)

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked. The disposition of imposition of KRW 1,618,400,000 against the plaintiff on September 15, 2004 by the defendant shall be revoked.

1. A cited part;

This court's reasoning is as stated in the reasoning of the judgment of the court of first instance, except for addition and modification as follows. Thus, this court's reasoning is cited as it is in accordance with Article 8 (2) of the Administrative Litigation Act and the main text of Article 420 of the Civil Procedure Act.

A. The provision on deemed donation under Article 41-2(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 6780, Dec. 18, 2002; hereinafter “the former Inheritance Tax and Gift Tax Act”) shall apply to the case where the actual owner and the nominal owner register in the future under an agreement or communication with the nominal owner when the transfer or exercise of the right requires registration, etc., of the property that requires the transfer or exercise of the right. Therefore, where the registration is unilaterally made in the nominal owner regardless of the intent of the nominal owner, it cannot be applied to the case where the tax authority establishes that the actual owner is different from the nominal owner, however, if the tax authority establishes only that the actual owner is different from the nominal owner, it shall be the nominal owner who asserts that the unilateral act was conducted in the nominal owner regardless of the intent of the nominal owner (see, e.g., Supreme Court Decision 2007Du15780, Feb. 14, 200

B. On the 4th 9th 9th e.g., the first instance court’s decision, “as a whole, it is difficult to see that the 00 e.g., unilaterally acquired the instant shares in the Plaintiff’s name without the Plaintiff’s consent or ratification

C. On December 5, 2001, the court of first instance alleged that the title trust relation to the shares of this case was not ratified, such as that "I do not believe that "I do not believe I," in the fourth 14th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th, 2001."

2. Additional determination

The plaintiff asserts that there was no purpose of tax avoidance in acquiring the shares in his name.

The legislative purport of Article 41-2(1) of the Act is to recognize an exception to the principle of substantial taxation with the purport of effectively preventing the act of tax avoidance using the title trust system and realizing the tax justice. As such, the proviso of the same Article can be applied only where the purpose of tax avoidance is not included in the purpose of the title trust, and in this case, the burden of proving that there was no purpose of tax avoidance can be proved by means of proving that there was a purpose other than the purpose of tax avoidance. Therefore, with respect to the fact that there was no purpose of tax avoidance, the nominal owner who bears the burden of proving the burden of proof has a clear purpose irrelevant to the tax avoidance to the extent that it is recognized that there was no purpose of tax avoidance in the title trust, and the fact that there was no tax avoidance at the time of the title trust or in the future has to be proved to the extent that it would not have any doubt if there was an ordinary person based on the objective and supporting evidence (see, e.g., Supreme Court Decision 2004Du11220, Sept.

In the instant case, it is insufficient to recognize that the Plaintiff had no purpose of tax avoidance in acquiring the instant shares under its own name in light of the details, content, number, etc. of the title trust of the instant shares. Therefore, the Plaintiff’s assertion on this part is without merit.

3. Conclusion

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