A. Assumption of proof as to whether the title trust without the purpose of tax avoidance is deemed a donation and whether there was no such purpose

B. Whether Article 9(2) of the former Inheritance Tax Act (amended by Act No. 4022 of Dec. 26, 1988) concerning the appraisal of value where the value of the donated property for which a donation report has not been filed has declined (affirmative)

(c) The case holding that the taxation disposition, which was made on the purchase price as at the time of assessing gift tax on the land, is lawful in case where the purchaser purchased the land and donated it after two years and four months;

A. Article 32-2(1) of the Inheritance Tax Act provides that the reason why the real owner of an asset has entrusted the title of ownership of the relevant asset to a nominal owner is inevitable due to the circumstances on the part of the real owner, such as restrictions under the positive law, refusal of cooperation by a third party, etc., but it is proved that it was not aimed at seeking tax avoidance using it, it shall not be applicable. Here, the assertion and proof as to the fact that there was no intention to seek tax avoidance should be made by the nominal owner.

B. In case where a donee fails to make a report of gift pursuant to the provisions of Article 20 of the Inheritance Tax Act, the provisions of Article 9(2) of the former Inheritance Tax Act (amended by Act No. 4022 of Dec. 26, 1988) which stipulates that the valuation of donated property shall be based on the market price at the time of the imposition of gift tax, shall apply not only to cases where the value at the time of the imposition has fallen below the value at the time of donation

C. In assessing the value of donated property, “market price” refers to an objective exchange value formed through a normal transaction, and where there is an example of sale deemed to have been properly reflected in the price, it would be reasonable to view the price as the market price. However, if Company A donated the land purchased from Company B to the Plaintiff after the lapse of two years and four months, barring special circumstances, even if the determination of the purchase price was made between individuals who are not appraisal agencies, the above sale price as at the time of the imposition of gift tax is an adequate reflection of the objective exchange value, and the current market price as at the time of the imposition of gift tax. In a case where the value of donated property is to be assessed according to the market price at the time of the imposition of gift tax, even if the market price at the time of the imposition of gift tax was not known, and if the tax authority assessed the price at the time of the gift tax by considering it as the market price at the time of the imposition, there is no evidence to view that there was a decline in the market price between the taxpayer and the taxpayer.

A. Article 32-2 of the Inheritance Tax Act, Article 26 of the Administrative Litigation Act / [Liability for Admission] (B) Article 9(2) of the former Inheritance Tax Act (amended by Act No. 4022, Dec. 26, 1988)

A. Supreme Court Decision 89Nu3465 delivered on February 27, 1990 (Gong1990, 813). Supreme Court Decision 85Nu116 delivered on July 23, 1985 (Gong1985, 1202) 84Nu325 delivered on December 24, 1985 (Gong1980, 330) 86Nu318 delivered on January 20, 1987 (Gong1987, 379) 87Nu500 delivered on October 26, 1987 (Gong1987, 1812)

Maximum Promotion Act (Law Firm Han-woo et al., Counsel for the plaintiff-appellant)

Head of Dong Tax Office

Seoul High Court Decision 86Gu500 delivered on March 24, 1988

The case shall be reversed and remanded to the Seoul High Court.

1. As to the ground of appeal Nos. 2 and 1 of this title, and the supplemental appellate brief of this case by the Plaintiff, the court below held that the land of this case was originally owned by Nonparty 1 and it constitutes a constructive gift under Article 32-2 (1) of the Inheritance Tax Act, regardless of whether the actual owner and the owner on the registry have any actual income to the Plaintiff, and thus, it constitutes a constructive gift under Article 32-2 (1) of the Inheritance Tax Act, regardless of whether the actual owner and the owner on the registry have any actual income to the Plaintiff.

However, Article 32-2 (1) of the Inheritance Tax Act provides that the reason why the real owner of an asset under the same provision entrusts the nominal owner with the title of the asset in question to the nominal owner is limited by the positive law or due to the circumstances of the actual owner such as denial of cooperation by a third party, and it is proved that the real owner did not have the purpose of seeking the tax avoidance using it, it shall not be applied if it is proved that it did not have the purpose of seeking the tax avoidance. Here, the assertion that there was no purpose of seeking the tax avoidance should be the nominal owner.

Since the above legal principles of Article 32-2(1) of the Inheritance Tax Act are the same, the court below should urge the seller to prove if the circumstances of the seller's refusal to transfer and construction are the same as those of the reasons, and have decided whether to apply the above provisions of the same Act or not, notwithstanding the above, the court below should have decided whether to apply the above provisions of the same Act or not by urging the seller to prove further. However, the arguments that criticize this point in the original judgment which did not have affected the above legal principles as seen above are reasonable, and therefore the lack of judgment on the remaining grounds of appeal by the attorney-at-law cannot be maintained.

2. As to the grounds of appeal by Defendant Litigation Performers:

A. The provisions of Article 9(2) of the former Inheritance Tax Act (amended by Act No. 4022 of Dec. 26, 1988), which stipulates that the valuation of donated property shall be based on the market price at the time of the imposition of gift tax, shall be applicable to a case where the value at the time of imposition has decreased, as well as a case where the value at the time of imposition has decreased below the value at the time of donation. Therefore, the judgment of the court below in the same purport is correct, and there is no error in this regard. The argument on this point is groundless.

B. According to the reasoning of the judgment below, the court below found that the defendant imposed the tax in this case on the land of 993,60,000 won, which was the purchase price at the time of the sale contract as of May 21, 1983 at the time of the imposition of the above land, as the market price at the time of the imposition of the gift tax. The above decision of May 21, 1983 was made on September 18, 1985 between the private persons who are not public appraisal agencies, and it was made between many and unspecified persons, and the credibility is insufficient to recognize that the sale price was made between the private persons, which was not public appraisal agencies at the time of the imposition of the gift tax. In addition, in light of the following facts: (a) the (b) year period of the purchase of the land at the time of the plaintiff's representative director was for newly constructing a hotel as a hot spring site, it cannot be viewed as the market price at the time of imposition of the above purchase price, and (b) the tax amount exceeding the market price at the market price at the time of the original appraiser.

However, in assessing the value of donated property, “market price” means an objective exchange value formed through a normal transaction, so if there is an example of sale deemed to have properly reflected an objective exchange value, it would be reasonable to view the price as the market price (see, e.g., Supreme Court Decision 86Nu318, Jan. 20, 1987; Supreme Court Decision 87Nu500, Oct. 26, 1987). In this case, in the case, the non-party 1 purchased the land of this case from the non-party 1 who was the owner of the land on May 21, 1983 from the non-party 193,60,000, and donated it to the plaintiff, barring special circumstances, the above sale price is the market price as it reflects the objective exchange value at the time, and it would be the market price at the time, and it would not be the same as the purchase circumstance at the time of the purchase between the private parties, other than an appraisal agency, and the conclusion would not be different.

In addition, even if the market price at the time of the imposition of gift tax is assessed based on the market price at the time of the imposition of gift tax, even if the market price at the time of the imposition of gift tax cannot be known as in this case, and if the tax authority imposed a tax by considering the market price at the time of the imposition of gift tax as the price at the time of the imposition of gift tax, it can be seen that there was a decline in the market price between the parties (see Supreme Court Decisions 85Nu116, Jul. 23, 1985; 84Nu325, Dec. 24, 1985; 84Nu325, etc.), the above taxation is favorable to taxpayers, and thus, it cannot be claimed for cancellation of the taxation due to the illegality of the appraisal of gift property. In this case, the appraisal price at May 21, 1983 is 993,600,000 won at the time of the imposition of gift tax, and the appraisal price at the time of the above appraisal price at the market price at the market price at the market price at the bar.

Nevertheless, the court below, on the basis of the market price at the time of imposing the appraisal price, calculated the reasonable amount of tax by considering it as the market price at the time of imposing the appraisal price. This cannot be viewed as unlawful because it erred by misapprehending the legal principles on market price assessment as seen earlier, or by misunderstanding the facts concerning the market price in violation of the rules of evidence. The ground for appeal

3. Therefore, all of the original judgment shall be reversed, and the case shall be remanded to the court below. It is so decided as per Disposition by the assent of all participating Justices.

Justices Kim Yong-ju (Presiding Justice)