Daejeon District Court 2009Guhap623 (No. 30, 2009)

early 2008 Before 2069 ( November 19, 2008)

Whether it is a donation of cash deposited into the account

Although it is argued that temporarily stored cash in a passbook for immigration to the United States, the donation constitutes the donation, considering that the plaintiff's age is old, stable assets were possessed, and that the witness establishes a limited liability company and purchased buildings in cash.

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.

1. Purport of claim

The Defendant’s disposition of imposition of KRW 418,019,060, KRW 42,419.120, KRW 206, KRW 39,331,230, and KRW 100,785,850, all of which are imposed on the Plaintiff on March 18, 2008, KRW 42,419.120, KRW 206, KRW 39,331,230, and KRW 2006.

2. Purport of appeal

The judgment of the first instance is revoked, and a judgment such as the purport of the claim is sought.

1. Details of the disposition;

A. On July 19, 2006, the Plaintiff reported and paid KRW 2,661,247,025, and KRW 283,51,51, and KRW 57,983,310, and KRW 57,983,310 of the inheritance tax calculated by applying the prior donated property as KRW 564,636,51, and KRW 283,51, and KRW 57,983,310 of the gift tax.

B. Around that time, the Defendant conducted an inheritance tax investigation with respect to the Plaintiff, and during that process, confirmed that the Plaintiff transferred the following money to the U.S. bankation of the Bank of South Korea and South Korea (hereinafter referred to as “the instant money”).

C. The Defendant: (a) determined that the instant money that the Plaintiff remitted to HanA and HanCC was donated to Han and HanCC; (b) imposed gift tax on Han and HanCC on March 18, 2008 pursuant to Article 4(1) of the Inheritance Tax and Gift Tax Act; and (c) imposed gift tax on the Plaintiff who remitted the said money as a joint taxpayer pursuant to Article 4(4) of the Inheritance Tax and Gift Tax Act (hereinafter “instant disposition”); and (c) determined that the details thereof are as follows.

D. On June 9, 2008, the Plaintiff filed an appeal with the Tax Tribunal against the instant disposition, but the Tax Tribunal rendered a decision to dismiss the Plaintiff’s claim on November 19, 2008.

[Ground of recognition] The facts without dispute, Gap evidence 1.3, Eul evidence 1.2 and 4 (including each number if there are provisional numbers) and the purport of the whole pleadings

2. Judgment on the plaintiff's assertion

A. The plaintiff's assertion

The Plaintiff was preparing to lease the AB to the U.S.A.A.A. and the Plaintiff had been seeking to lease the AB. However, since there was no U.S. bank account, at the time, the Plaintiff transferred the purchase fund of the building for lease and housing for residence to the U.S. bank account of the Plaintiff temporarily. Therefore, the instant money transferred to the Plaintiff’s account of HanA and HanCC is merely the funds for the Plaintiff’s overseas migration and settlement purpose, not the money that the Plaintiff donated to the Plaintiff. Nevertheless, the Defendant deemed the instant money to have been donated to HanA and HanCC and the instant disposition was unlawful.

B. Relevant statutes

It is as shown in the attached Form.

(c) Fact of recognition;

1) On May 25, 2006, KoreaCC established a limited liability company (hereinafter “instant limited liability company”) under the trade name called “CTSO and LLC” (hereinafter “the instant limited liability company”) with the NA, its wife KimD, and 1,50,000 U.S. building located in the name of the instant limited liability company (hereinafter “the instant building 1”), and acquired the ownership of the instant building on July 31, 2006. Meanwhile, the instant limited liability company succeeded to the lessor’s status on the other hand, including the money transferred from the Plaintiff on April 27, 2006 and approximately KRW 440,000 of the money borrowed from the local financial institution.

2) As seen earlier, the Plaintiff sent USD 2,110,798 to the new bank account opened in the name of the Plaintiff and the Korea-AA jointly. On August 31, 2006, the Korea-AA purchase of the first house located in New York (hereinafter “the instant house”) at USD 2,650,000 and paid the balance on November 22, 2006. As above, the Plaintiff paid the sales amount of the instant house by adding the money transferred from the Plaintiff and the amount of USD 850,000 that received as security to the instant house.

3) The reasons why the Plaintiff acquired permanent residence and social security numbers in the United States and the status of residence in the Republic of Korea and the United States are as follows.

4) At the time when the Plaintiff transferred to Korea on April 27, 2006, to Korea, on June 1, 2006, September 4, 2006, October 24, 2006, and on October 31, 2006, Korea entered Korea temporarily and left Korea each time.

5) The new bank account opened in the common name of the Plaintiff and HanA was opened by Han on October 25, 2006, and was withdrawn from the U.S. on November 9, 2006 and November 13, 2006. The Plaintiff did not stay in the U.S. at the time of establishment and withdrawal as above.

6) In the purchase of the instant building or the instant house, the Plaintiff did not bear a loan obligation for the preparation of the purchase price, and did not bear a guarantee obligation for the said loan obligation.

7) The Plaintiff stated to the following purport in the hearing procedure of the court of first instance with respect to the Plaintiff himself.

① The value of the instant house purchased in the United States is KRW 280,000,000,000 in Korean money.

② It is well-known that most children have received loans while purchasing the instant house.

③ The value of the instant building purchased in the United States is KRW 150 million.

④ The reason and writing that the instant building and the housing were purchased in the name of Korea-AA, a smaller child as to the instant building without purchasing all the instant building in the name of Korea-AA, and the reason and writing that it was purchased in the name of Korea-U.S. as to the instant building was made to children, who were small.

⑤ The Plaintiff was well aware of the amount remitted to the United States.

④ The Plaintiff transferred money to the U.S. to KRW 3.9 billion. Of that, whether there was money remaining after purchasing the instant building and the instant house, and whether there was a money to arbits: whether there remains money, and the money was left to arbits. The money was left to arbits.

7. There is no money lending or interest from them, and there is no difference in the house.

8) The Plaintiff did not pay gift tax according to the instant disposition and thus was prohibited from departing from May 13, 2008 to the date of closing argument.

[Ground of recognition] Facts without dispute, Gap's statements, Gap's evidence 4 through 10, 14 through 20, 26 through 29, 42, 60, Eul's evidence 4 and 5 (including each branch number, if any), the result of the plaintiff's question by the court of first instance, the purport of the whole pleadings.

D. Judgment on the Plaintiff’s assertion

Article 2 (3) of the Inheritance Tax and Gift Tax Act provides that "to transfer to another person any tangible or intangible property free of charge in a direct or indirect manner, regardless of the name, form, purpose, etc. of the act or transaction, the economic value of which can be calculated."

In light of the circumstances as seen above, it is reasonable to view that the Plaintiff transferred property of the type of the instant money to Han and HanCC free of charge. Thus, the disposition of the instant case based on the premise that the Plaintiff donated the instant money to Han and HanCC is lawful.

1) At the time when the Plaintiff transfers the instant money to the United States, Han et al. returned to the Republic of Korea without exception and participated in the transmission, and it appears that Han et al. were to have withdrawn independently from the Plaintiff’s involvement in withdrawing the instant money.

2) Once the Plaintiff remitted money to KoreaCC, the Plaintiff acquired the ownership of the instant building with the money remitted by the Plaintiff and the money loaned under the name of the instant limited company, after the Plaintiff established the instant limited company by Korea-CC husband and wife.

3) Once the Plaintiff transferred the instant house to Korea, the fact that the Plaintiff acquired the ownership of the instant house with the money loaned under the name of Korea-A and the money transferred by Korea-A, after entering into a sales contract for the instant house.

4) Despite the Plaintiff’s burden of cash payment in acquiring the ownership of the instant building and the instant house, it did not secure any right, such as ownership, to the instant building and the instant house.

5) The Plaintiff is entirely aware of the total remittance, details of use, balance after use, etc. of the instant money, and stated to the effect that Korea-A or Korea-CC was charged with, or ordered to, the instant building and housing purchased with the instant money or the instant money without compensation.

6) While Han-A resides in New York, Han-AA, Han-A, despite the fact that the instant building was purchased in the name of Han-A, in the name of Han-A, and each of the instant limited companies established by Han-CC husband and wife.

7) On October 25, 2006, before the Plaintiff was granted a social security number, the Plaintiff opened a new bank account in the name of the Plaintiff and Han-A on October 31, 2006 under the joint name of the Plaintiff and Han-A, and it is merely a role similar to the resident registration number of the Republic of Korea and thus, it is difficult to conclude that the Plaintiff may open an account in the name of the Plaintiff or purchase real estate in the name of the Plaintiff only after obtaining the social security number as the Plaintiff’s assertion. Even if the Plaintiff’s assertion is true, the Plaintiff acquired the permanent residence right on April 13, 2006 and applied for the permanent residence right on October 20, 206, and obtained the social security number around the end of December 20, 2006, and if the circumstances exist, it is hard to understand that the Plaintiff purchased the building under the name of the Plaintiff, other than the building in this case, around July 8, 2006.

8) The Plaintiff was 96 years old at the time of remitting the instant money.

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 justified as it is so decided as per Disposition and it is so decided as per Disposition.