Seoul Administrative Court 2012Guhap6568 ( November 02, 2012)

The early appellate court 2010west 3742

If a claim is paid by proxy for a gift act, the agent shall not be the donee, but shall impose the gift tax on the actual donee.

If, even if a claim was received in advance from an inheritee but it was represented by a donee as a guardian of the inheritee, this does not constitute a gift, and thus, the donee must be subject to a disposition of gift tax.

Articles 1 through 2 of the Inheritance Tax and Gift Tax Act

2012Nu38406 Revocation of Disposition of Imposition of Gift Tax

KimA

LB

Samsung Head of Samsung Tax Office

Seoul Administrative Court Decision 2012Guhap6568 decided November 2, 2012

September 25, 2013

October 23, 2013

1.The judgment of the first instance shall be modified as follows:

A. On August 2, 2010, the Defendant revoked the part exceeding OOO(including additional duties) of the imposition of gift tax imposed on Plaintiff KimA on August 2, 2010.

B. On January 4, 2011, the Defendant’s disposition on the imposition of the gift tax by the Plaintiff LB on January 4, 201, exceeding OOO(including additional tax) shall be revoked.

C. Each of the plaintiffs' remaining claims is dismissed.

2. Of the total litigation costs, the part arising between the plaintiff KimA and the defendant shall be four minutes, and the remainder shall be borne by the defendant, while the part arising between the plaintiff KimB and the defendant shall be ten minutes, and the above plaintiff 9 shall be borne by the defendant.

1. Purport of claim

The Defendant’s imposition of OOO(including additional taxes) on August 2, 2010 against Plaintiff KimA and the imposition of OOO(including additional taxes) on January 4, 201 against Plaintiff ChoiB on January 4, 201.

2. Purport of appeal

A. Plaintiff KimA

The part of the judgment of the court of first instance against the plaintiff KimA shall be revoked. The defendant shall revoke the disposition of imposition of the gift tax OO(including additional tax) against the plaintiff KimA on August 2, 2010.

B. Defendant

The part against the defendant in the judgment of the court of first instance shall be revoked, and the claim of the plaintiff mostB corresponding to the above revocation shall be dismissed.

1. Details of the disposition;

(1) On February 20, 2007, KimCC accepted a salt-only land located at OO-Gu O-si, OO-owned on February 20, 2007, and received OOOO as a bond in cash and OOO-owned.

(2) On August 30, 2007, KimCC was declared incompetent by the Seoul Family Court (2006 Ma3394), and Plaintiff KimA, the head of KimCC, was a guardian.

(3) Meanwhile, the above claim was entered into the Korea Investment Securities Account in the name of KimCC. On October 21, 2008, the Plaintiff KimA delivered the claim of OOOOOwon (hereinafter “the instant claim”). On October 27, 2008, Plaintiff KimA deposited the instant claim into the Korea Investment Securities Account in its name. On November 21, 2008, 2008, OOOOOOOwon, and OOOOOOOOOOOO on April 22, 2009, and deposited it into the deposit account in its name. The Plaintiff ChoiB, the spouse of Plaintiff Kim Jong-A, received OOOOOOO from Plaintiff Kim Private Teaching Institute to its own deposit account in its name and received OOOOOOwon from Plaintiff Kim Private Teaching Institute (hereinafter “D transfer”). The Plaintiff acquired the instant claim from a private teaching institute (hereinafter “D”).

(4) The KimCC died on April 29, 2009, and on October 30, 2009, KimF, among property inheritors, notified the Defendant on the ground that "GlaCC donated the instant claim to Plaintiff KimA," the Defendant reported and paid inheritance tax by adding the instant claim to the inheritance property value. On August 2, 2010, the Defendant imposed and notified OOO (including additional tax) of gift tax on the ground that "GlaCC received the instant claim from KimA" (hereinafter referred to as "the instant disposition against Plaintiff KimA"), and on January 4, 2011, the Defendant imposed OO (including additional tax) of gift tax on the Plaintiffs on the ground that "the Plaintiff received the instant claim from Plaintiff KimAD," and the Defendant imposed the gift tax on the Plaintiffs (hereinafter referred to as "the instant disposition against the Plaintiff").

(5) On October 29, 2010, Plaintiff KimA filed each appeal on March 29, 201, and Plaintiff ChoiB filed each of the appeals on March 29, 201, but was dismissed by the Tax Tribunal on December 22, 2011.

[Reasons for Recognition] Unsatisfy, Gap evidence 2, 3, 4 (including virtual number), Eul evidence 1 to 6, the purport of the whole pleadings

2. Whether each of the dispositions of this case is legitimate

A. The plaintiffs' assertion

(1) Plaintiff KimA

The above Plaintiff entered into a contract for the acquisition of DD Institute as an incompetent, KimCC’s guardian, and received the instant claim from the account to pay the acquisition fund, and thus, did not receive the donation of the instant claim. Even if the Plaintiff received the donation, since it was disbursed for the purpose of paying the acquisition price of the school foundation in the name of KimCC as the repayment of the acquisition price of the school foundation in the name of KimCC, it does not constitute a value of donated property. Therefore, the instant disposition against

(2) Plaintiff LB

The above plaintiff was transferred to the account transfer for the purpose of paying the acquisition fund of the DD Institute by replacing the plaintiff KimA. Thus, the disposition of this case against the above plaintiff on the premise that the above plaintiff was given a donation of the acquisition fund of this case is unlawful.

B. Relevant statutes

Attached Form 1 is as shown in the relevant statutes.

C. Facts of recognition

(1) On October 17, 2008, after consultation on the transfer of the right to operate D Driving Institutes, Plaintiff LB renounced the right of interested parties under the Private School Act on the property and operation of D Driving Institutes, which was the founder of D Driving Institutes, from September 2008, and from October 17, 2008, and made it possible for Plaintiff BB or the person recommended by the said Plaintiff to operate D Driving Institutes as a full-time director system. Plaintiff B made an agreement on the transfer and acquisition of D Driving Institutes (hereinafter “instant contract”) with Plaintiff B, upon the decision of approval of the director recommended by Plaintiff LB in the Education, Science and Technology (hereinafter “the current Ministry of Education”) under the Private School Dispute Mediation Committee (hereinafter “Private Sector”) under the Education, Science and Technology (the date when the decision of approval of the director recommended by Plaintiff LB, the first B made an agreement on the transfer and acquisition of D Driving Institutes in return for the transfer of D Driving Institutes, or for the establishment of D Private Teaching Institutes (hereinafter “instant contract”).

(2) On December 11, 2008, the Plaintiff LB attended the HH high school’s school conference operated by the DH Institute, and expressed his/her intention to acquire it, and submitted the OOO’s property contribution plan to the DD Institute. On December 26, 2008, the Plaintiff attended the board of directors of the DH Institute and explained the scheme for normalization of DO’s institute. Accordingly, the DO’s board of directors decided to recommend the candidates for directors recommended by the Plaintiff LB as directors.

(3) At the time of January 2009, Plaintiff LB deposited OBO in the new branch of the Gwangju Bank under the joint name of the president of the DDA and Plaintiff LB, and the DOB submitted to the Gwangju Metropolitan City Office of Education a plan for normalization, including a case in which Plaintiff LB was appointed as the president of the DOB, and the Superintendent of the Gwangju Metropolitan City Office of Education submitted the above plan for normalization to the company.

(4) On April 9, 2009, Plaintiff LB appeared on the company and stated that “When he/she takes over DD driving schools, he/she shall create the school development fund by making a contribution to a certain amount every year, provide community service, train human resources, etc., he/she would be well aware of the operation of the school.” On April 23, 2009, at the 37th session of April 2009, Plaintiff LB resolved on the cases of Plaintiff LB’s most BB’s acceptance of DD driving schools and appointment of Plaintiff B as the president of D Driving Institutes.

(5) On May 8, 2009, the board of directors of the Dental Institute decided to elect Plaintiff LB as the president and deposit the basic property for profit-making in cash in the Gwangju Bank. Accordingly, Plaintiff LB deposited OOO in the Gwangju Bank on May 13, 2009 out of the transfer price received from Plaintiff KimA’s account.

(6) On June 3, 2009, Plaintiff LB entered into a contract between the second and third parties of the second instance on June 3, 2009, and “Plaintiff LB shall take over the status of the contributor of the real estate contributed as the basic property for profit at the time of the establishment of the DDD Institute, and pay the OOO personnel.” On June 9, 2009, the DD Institute Council resolved to change the contributor of the real estate, which is the basic property for profit, to Plaintiff LB. Meanwhile, Plaintiff LB agreed to exchange the basic property for profit of the DD Institute and the basic property for profit of the JAD Institute established by the HGG.

(7) On October 27, 2009, the inheritors of KimCC agreed on the division of inherited property on October 27, 2009, and Plaintiff KimA did not receive the remainder of the claim for expropriation except for the instant claim.

(8) During the process of the transfer under the instant transfer agreement, as it is difficult to directly receive the transfer proceeds due to his excessive debt, the Plaintiff LB requested the Plaintiff LB to change the transferor to KimK, one’s own wife, and the Plaintiff LB consented to the change of the transferor’s name after the transfer procedure is terminated due to the performance of the obligation of the CategoryGG, such as the Plaintiff’s refusal of the said request and the Plaintiff’s appointment as the president of the DD Institute.

(9) Meanwhile, on March 2, 2010, after the death of KimCC, the Plaintiff LB paid the balance of the transfer price to GGGG, and, in order to avoid gift tax or inheritance tax, the Plaintiff agreed to change the transferee to GG and transfer agreement (Evidence A9) with the advice of the tax accountant who has overall participated in the transfer and acquisition agreement of this case for the purpose of avoiding gift tax or inheritance tax. For the same day, the above transfer and acquisition agreement is 3.7.7, on the other hand, after the establishment and operation of the school and the calculation of high birth, the transfer is completed. On April 2, 201, after the approval of the director recommended by the Defendant was finalized, the Plaintiff LB continued to pay the balance of the transfer price to GGG, and the scholarship foundation was also established, and the Defendant 2, who is the guardian, prepared the previous agreement to take over and take over the claim by the Defendant 1 and his family 0.7.

(10) The plaintiff KimA prepared a letter of delegation that the mandatory "B" was "B" on October 17, 2008, and that "the date of the preparation is "the full delegation of all matters concerning the process of acquiring DNA driving schools, such as transfer/acquisition agreements and schools, financial rights loans, money-related business in the training courses of Dental driving schools, office of education (private school dispute mediation committee)", and the letter of delegation was accompanied by the certificate of personal seal impression on April 21, 2009 as of February 27, 2006, which was later than the date of preparation of LAA as well as the certificate of personal seal impression in the name of plaintiff KimA on April 21, 2009."

(11) On May 19, 2010, the board of directors of the Dental Institute dismissed Plaintiff LB and decided to select KimL, the Plaintiffs’ children, as the president.

(12) In the tax investigation of Gwangju Metropolitan City, the Defendant requested the superintendent of the board of education of Gwangju Metropolitan City to “the Plaintiff mostB exercised the authority to take over the Do driving school on behalf of the Plaintiff KimA,” and the Superintendent of the Office of Education of Gwangju Metropolitan City sent a reply to the Defendant on August 23, 2010 that “the Plaintiff KimA has no relationship with the Do driving school.” In the tax investigation, the Defendant requested that “the Plaintiff most BB exercised the authority to take over the Do driving school on behalf of the Plaintiff KimA, whether the Private School Dispute Mediation Committee deliberated on the Plaintiff KimA, as relevant minutes and relevant data,” and the Private School Dispute Mediation Committee sent to the Defendant on August 25, 2010 that “No content or discussion about the Plaintiff KimA was discussed in the meeting related to the deliberation.”

(13) On October 20, 2010, the head of the administrative office of the DNA Institute testified that "the sales contract of the DNA Institute was made between the Plaintiff, the largestB and the CategoryGG, and he paid the debt OOO in subrogation of the Plaintiff," under the Civil Procedure Act (Seoul Central District Court 2010Gahap22106) concerning the underwriting contract of the DNA Institute.

(14) In the tax investigation, SectionG stated that “The actual transferee of the DD driving school is Plaintiff B. The Plaintiff LB paid OO of the acquisition price of the DD driving school under the condition that the president, director, and auditor recommended by himself/herself was approved by the Private School Dispute Mediation Committee.” On January 14, 2010, GG testified testified that “The date the approval of the D driving school was confirmed” was immediately paid the acquisition price of the D driving school from the deposit in the name of Plaintiff B on the date the approval of the D driving school was confirmed. He/she and HM, who is himself/herself and son, was acting for Kim K, to receive the acquisition price of the D driving school on behalf of the D driving school.”

(15) In the first instance court, KimF had difficulty in making normal decisions and activities since the aggravation of the disease from around 2000. There was no talking that KimCC would specifically take over any school juristic person. The proposing that “Plaintiffs” will take over the DNA Institute as the property of KimCC around 2006. The remaining successors except the Plaintiff KimA testified that they were not involved in the operation of the DNA Institute.

(16) The plaintiff KimA suffered from sediosis and tuberculosis vertebrate, received vertebrate removal and fixed surgery at Seoul National University Hospital on May 18, 2005, and received outpatient treatment from July 20, 2005 to May 13, 2009.

[Based on Recognition] Facts without dispute, Gap evidence Nos. 4 through 12, 15 through 19, 34, 38 (including paper numbers), Eul evidence Nos. 5, 7, 9, 10 through 17, and 19 through 21, part of witness KimF testimony, and the purport of the whole pleadings

D. Relevant legal principles

Article 2(3) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 9916, Jan. 1, 2010) provides that "the term "donation" means a gratuitous transfer (including a case of transferring at a remarkably low price) of tangible or intangible property, which can calculate economic values, by direct or indirect means, to another person (including a case of transferring it at a remarkably low price) or an increase in the value of another person's property by means of contribution." Thus, the concept of comprehensive donation under the Civil Act and other tax-related Acts, which are unique to the Civil Act. Therefore, even if a donation contract is not under private law, if the property is actually transferred without compensation, it shall be deemed as subject to the gift tax.

In addition, in a lawsuit seeking revocation of disposition imposing gift tax, inasmuch as the deposit in the name of a donor is found to have been withdrawn by the tax authority and deposited in a deposit account in the name of the taxpayer, such deposit shall be presumed to have been donated to the taxpayer. Thus, in special circumstances, such as withdrawal of such deposit and deposit in the name of the taxpayer, etc. were made for other purpose than donation, the need for proof thereof is the taxpayer (see Supreme Court Decision 9Du4082, Nov. 13, 2001).

On the other hand, in cases where an actor who enters into a contract performs a juristic act in another person’s name, as to whom the actor and the other party are the party to the contract, the parties to the contract should first be determined according to the same intent if the actor and the other party agree with each other. In cases where the intent of the actor and the other party is not in accord with each other, the parties should be determined by whether the other party would understand either the actor and the nominal owner as the party to the contract, based on the specific circumstances before and after the conclusion of the contract, such as the nature, content, purpose, circumstance of concluding the contract, etc. (see, e.g., Supreme Court Decision 2009Da27513, Dec. 10,

E. Determination

(1) As to the transferee of the transfer contract of this case

Plaintiff KimA asserted that the transferee of the instant transfer agreement was KimCC, and that himself entered the instant claim in his own account in order to pay the instant transfer fund in the capacity of guardian, and Plaintiff ChoiB asserted that the instant transfer agreement was merely an account transfer for the payment of the instant transfer fund on behalf of Plaintiff KimCC on the premise that one of the parties to the instant transfer agreement was KimCC. Therefore, we first examine who is the transferee of the instant transfer agreement.

6. As to the transfer and acquisition of the Plaintiff 2, the Plaintiff 1 and the Plaintiff 2 did not appear to be the first 0-year transfer and acquisition of the Plaintiff 1 and the first 0-year transfer and acquisition of the Plaintiff 1 and the first 0-year transfer and acquisition of the Plaintiff 2 to the 0-year transfer and acquisition of the Plaintiff 1 and the first 0-year transfer and acquisition of the Plaintiff 1 and the first 0-year transfer and acquisition of the Plaintiff 2, the Plaintiff 1 and the first 0-year transfer and acquisition of the Plaintiff 2, which were the 0-year transfer and acquisition of the Plaintiff 1 and the first 0-year transfer and acquisition of the Plaintiff 2, which were the 0-year transfer and acquisition of the Plaintiff 1 and the first 0-year transfer and acquisition of the Plaintiff 1 and then the 0-year transfer and acquisition of the Plaintiff 2 were the 0-year transfer and acquisition of the Plaintiff.

(2) As to the legitimacy of the instant disposition against the Plaintiff KimA

As seen earlier, the claim of the KimCC was entered into the Korea Investment Securities Account in the name of KimCC, and among which, the claim of this case was entered into the Korea Investment Securities Account in the name of Plaintiff KimA on October 21, 2008. The claim amount of this case (OOOO) is equivalent to the amount of Plaintiff KimA’s inheritance share (1/5) and Plaintiff KimA was not divided or exercised rights on the remainder of the claim for expropriation except the claim of this case at the time of the agreement on the division of inherited property. In view of the fact that Plaintiff KimA was not entitled to the division of inherited property, it can be presumed that Plaintiff KimA was donated the claim of this case from Il KimCC.

However, the following circumstances are inferred by the above recognition, namely, ① the status of guardian of KimCC, who was declared incompetent while KimCC head was well-known. ② The Plaintiffs were married, and the Plaintiffs were proposed to acquire the school juristic person’s property of KimCC around 2006 at the same time to the other inheritors, and ③ the external activities of Plaintiff KimA, who was suffering from disease, appear to have been the largest BB. As seen earlier, it is reasonable to view that the Plaintiff’s act of transferring the funds to the Plaintiff’s account under the name of the Plaintiff’s maximum administrator of the instant transfer of the funds to the Plaintiff’s account was reasonable after concluding the instant transfer contract, and that the Plaintiff’s act of transferring the funds to the Plaintiff’s account under the name of the Plaintiff’s maximum administrator of the instant transfer of the funds to the Plaintiff’s account was deemed to have been carried out by the Plaintiff’s transfer of the funds to the Plaintiff’s account under the name of the Plaintiff’s maximum administrator of the instant transfer of the funds to the Plaintiff’s account.

The Plaintiff KimA alleged that the part of the instant claim exceeds the amount of the acquisition price of the instant case was used as the acquisition fund of the Korea Institute, but it is insufficient to recognize the said assertion only by the entries in the evidence Nos. 13, 14, and 33 (including the serial number) of the Korea Institute. There is no other evidence to acknowledge it.

Therefore, the taxable value of the gift tax on the Plaintiff KimA is an OO(OO - OOO - OO ) and the reasonable tax amount for this is an OOO as shown in attached Table 2. Therefore, the part in excess of the above amount among the disposition of this case against the Plaintiff KimA should be revoked as unlawful.

(3) As to the legitimacy of the instant disposition against Plaintiff LB

As seen earlier, it is reasonable to view that the instant acquisition fund was donated by Plaintiff LB from KimCC, and the evidence submitted by the Plaintiffs alone is insufficient to reverse the recognition.

Therefore, the taxable value of the gift tax on the Plaintiff LB is donated to the OOO or KimCC, which is not the Plaintiff KimA, the husband, as in the previous case, and the amount of the justifiable tax on it is a OOO member as in the attached Table 2 (On the other hand, it seems that there was an error in the previous disposition on the Plaintiff LB), and the portion exceeding the above amount among the disposition on the Plaintiff LB related to the Plaintiff LB should be revoked unlawfully.

3. Conclusion

Therefore, the plaintiffs' claims against the defendant in this case against the defendant shall be accepted within the extent of the above recognition, and the remaining claims shall be dismissed without merit. Since the judgment of the court of first instance is unfair with some different conclusions, the appeal of the plaintiff KimA and the defendant shall be partially accepted, and the judgment of the court of first instance shall be modified as above. It is so decided as per Disposition.