(a) Whether the land is deemed to have been used directly for its unique duties in case where a corporation that runs a civil engineering construction business as its objective business constructs a tax office building on the land acquired pursuant to an exchange agreement on the new office building of the tax office and its site and transfers it to the State along with the site;

(b) The meaning of "sale-use land" under Article 84-4 (3) 2 of the Enforcement Decree of the Local Tax Act

A. The acquisition of a company’s land on the company’s account pursuant to an exchange agreement on the new and old office building and its site between the head of a tax office and the head of a tax office, and the construction of an applicant by the tax office on that ground, and all of these are transferred to the State. As such, since the company is engaged in the self-managed construction business among the construction businesses listed in the Korean Standard Industrial Classification Table, it should be deemed that the company directly

(b) For the purpose of Article 84-4 (3) 2 of the Enforcement Decree of the Local Tax Act, the term “land for sale acquired for the purpose of sale” means the land acquired for the purpose of offering for sale to real estate sales business, and it does not include the land for construction acquired together with the building, which is the site for sale

(a) Article 112 (2) of the Local Tax Act, Article 84-4 (1) and Article 84-4 (2) (b) of the Enforcement Decree of the Local Tax Act;

Supreme Court Decision 93Nu17553 delivered on November 9, 1993

Attorney Song-hoon et al., Counsel for the defendant-appellant

Gunsan City

Gwangju High Court Decision 92Gu2393 delivered on July 1, 1993

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

1. The defendant's first ground for appeal

If the facts are duly determined by the court below, the Plaintiff Company acquired the instant land on the Plaintiff’s account in accordance with an exchange agreement on the new and old office building and its site between the head of the Gunsan Tax Office, and constructed an applicant for the Gunsan Tax Office on that ground, and transferred all of them to the State. As such, since the Plaintiff Company’s operation of the building self-managed construction business among the construction businesses under the Korean Standard Industrial Classification prepared by the Statistics Office, it should be deemed that the Plaintiff Company directly used the instant land in the civil engineering construction business, which is a business set forth as an objective

Therefore, we cannot accept the decision of the court below that held this purport that there is an error of law by misunderstanding the legal principles on Article 84-4(1) of the Enforcement Decree of the Local Tax Act.

2. Determination on the ground of appeal No. 2

According to Article 84-4 (3) 2 of the Enforcement Decree of the Local Tax Act, land for sale acquired by a corporation which does not engage in real estate sales business as its main business to a third party shall be deemed land for non-business use even if it is used directly for its unique business. In light of the legislative intent of the above provision, it is to regulate the acquisition and holding of land for sale by a corporation which does not engage in real estate sales business as its main business. In light of the above provision, the "land for sale acquired for sale" shall not include the land acquired for the purpose of offering it to real estate sales business with the building, nor shall it include the land for construction acquired for the purpose of transfer along with the building.

Therefore, we cannot accept the decision of the court of first instance that held that the land of this case acquired by the plaintiff for the purpose of exchanging with the Gu office building and the land for the purpose of building the applicant for the Gunsan Tax Tax, does not constitute the "land for sale acquired for the purpose of selling to a third party" as stipulated in subparagraph 2 of the above provision, as it criticizes that there was an error of law by misunderstanding the legal principles on the above provision

3. Therefore, the defendant's appeal is dismissed and the costs of appeal are assessed against the losing defendant. It is so decided as per Disposition by the assent of all participating Justices.

Justices Ahn Yong-sik (Presiding Justice)