Gangnam branch branch court 201Guhap45 ( October 15, 2012)

early 2010 Heavy2910 ( December 20, 2010)

In title trust, it cannot be readily concluded that there was no intention of tax avoidance in title trust.

Inasmuch as the amount of tax on the dividend income that can be avoided through the title trust is not significant or there is no reduced tax evasion or reduced tax on the shares through one nominal trust, it cannot be readily concluded that the Plaintiff did not have any intent of tax avoidance in the title trust under the tax law in holding the title trust of the shares of this case.

(Chuncheon)Revocation of revocation of the imposition of gift tax, 2012Nu534

LAA

Head of Three Tax Office

Chuncheon District Court Decision 2011Guhap45 decided May 15, 2012

April 3, 2013

July 24, 2013

1.The appeal by the plaintiff shall be filed.

2. Costs of appeal shall be borne by the Plaintiff.

The judgment of the first instance shall be revoked. The defendant's disposition of imposing gift tax of KRW 76,054,010 on the plaintiff on May 11, 201 shall be revoked (the date of the complaint's disposition shall be deemed to be written in writing on May 17, 2010).

1. Quotation of a judgment of the first instance court;

This Court's reasoning is as stated in the reasoning of the first island's judgment, except as stated in the following 2.B. part of "the Judgment on the Claim No. 2.B." among the grounds for the judgment of the first instance court, and in accordance with Article 8(2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act.

2. Parts to be dried;

B. Determination as to the assertion of the above 2-B

(1) Relevant legal principles

The legislative intent of Article 45-2(1) of the Inheritance Tax and Gift Tax Act is to establish exceptions to the substance over form principle to the purport that the tax justice is realized by effectively preventing the act of tax avoidance using the title trust system. Thus, if the title trust was established for any reason other than the purpose of tax avoidance, and it is merely a minor tax reduction incidental to the said title trust, it cannot be readily concluded that such title trust had the purpose of tax avoidance. However, in light of the legislative intent above, only if the purpose of the title trust is not included in the purpose of tax avoidance, it cannot be determined as a deemed donation by applying the proviso of the above provision, and it cannot be deemed that there was any intention of tax avoidance, and it cannot be said that there was no other purpose, and that there was no intention of tax avoidance, and the burden of proof as to the fact that the title trust did not have the purpose of tax avoidance is to the person who asserts it (see, e.g., Supreme Court Decisions 2007Du1931, Apr. 9, 2009; 207Du7575, Sept. 17, 2017).

In addition, as the nominal owner who bears the above burden of proof, there was an obvious purpose irrelevant to the tax avoidance to the extent that there was no tax avoidance purpose in the title trust, and there was no tax avoidance at the time of the title trust or in the future, with objective and conclusive evidentiary materials, to the extent that ordinary person is not doubtful (see, e.g., Supreme Court Decisions 2004Du1120, Sept. 22, 2006; 2010Du23569, Feb. 24, 2011).

Furthermore, it is reasonable to view that the issue of whether there was a purpose of tax avoidance or not should be determined as at the time when the title trust was made in question, and that it should not be determined as at the time of the actual evasion of any tax after the title trust (see Supreme Court Decisions 2003Du4300, Jan. 27, 2005; 2004Du11220, Oct. 29, 2009; 2009Du11348, Oct. 29, 2009).

(2) Determination as to the assertion that it is intended to meet the number of promoters

The plaintiff, the first company's acquisition of seven existing shareholders at the time of the first company's establishment, and the following circumstances, i.e., the Commercial Act amended by Act No. 6488 of Jul. 24, 2001, which entered into force on the same day, did not impose any restrictions on the number of promoters necessary for the establishment of the company, i.e., (i) the Commercial Act, which was amended by Act No. 6488 of Jul. 24, 2001, was amended by Act No. 6488, and (ii) the time when ParkS acquired the shares and title trust to the plaintiff on July 12, 2004, did not need to meet the requirements of the number of promoters (in addition, under the statement of evidence No. 5, ParkS was taken over from AA to December 11, 2003, and it was not at all problematic since the first acquisition of the shares of this case on December 11, 2003

1) Article 288 of the Commercial Act amended by Act No. 4796 of Dec. 22, 1994 provides that seven or more promoters for the incorporation of a corporation shall be required, but the Commercial Act amended by Act No. 6086 of Dec. 31, 1999 requires three or more promoters, and the Commercial Act amended by Act No. 6488 of Jul. 24, 2001 does not limit the number of promoters.

③ In full view of the above legal principles, there is no evidence to acknowledge that ParkS has discussed or agreed to acquire the shares of this case to seven shareholders when acquiring the shares of this case from the Korean commercial theory, and the evidence submitted by the Plaintiff alone cannot be recognized that the title trust of the shares of this case was for the purpose of meeting the number of promoters required under the Commercial Act that is not superior to the tax avoidance, and that the Plaintiff’s assertion on this part is without merit.

(3) Determination on the assertion that the purpose was to avoid the provision of exclusion from the selection of supervisory duties by affiliated companies under the former Enforcement Decree of the Construction Technology Management Act

Article 51 (1) 2 of the former Enforcement Decree of the Construction Technology Management Act (amended by Presidential Decree No. 18039 of Jun. 30, 2003), the plaintiff, and its affiliates, should not be designated as a specialized construction supervising firm, and where a specialized construction supervising firm performing supervision becomes an affiliated company of the contracting party, it must replace the specialized construction supervising firm. He must hold a total of 21.80% shares in the name of the major shareholder of DD Integrated Construction Co., Ltd. (hereinafter referred to as the "DD case"), and where the company will own 30% or more of the shares of DD case, the affiliated company of this case, which is a specialized construction supervising firm, could not be responsible for supervising the construction work executed by RRD case, and therefore, the company registered the trust to the plaintiff as above.

(ii) Article 51 (Selection, etc. of Specialized Company A)

j Where a specialized construction company is selected to have a responsible supervision, etc. pursuant to Articles 27 and 27-2 of the Act, the contracting authority shall not select as a specialized construction supervising firm a contractor for the construction work (where a joint contract has been made through a package deal tender for design and construction work, a joint beneficiary) and an affiliated company of a contractor for the construction work, and where a specialized construction supervising firm A who is performing supervisory work becomes an affiliated company of a contractor for the construction work, it shall immediately replace the specialized construction supervising firm.

Article 2(3) of the former Monopoly Regulation and Fair Trade Act (amended by Act No. 7315 of Dec. 31, 2004, hereinafter referred to as the "Fair Trade Act"), and Article 21.8 through 13 of the former Monopoly Regulation and Fair Trade Act (amended by Act No. 7315 of Dec. 31, 2004, hereinafter referred to as the "Fair Trade Act"), and Article 25 of the former Enforcement Decree of the Fair Trade Act (amended by Presidential Decree No. 18736 of Mar. 8, 2005, 200, 30% of the shares of the company were owned by 24.8% of the shares of the investment trust of this case, 24.96%, and 3% of the shares of the company are already owned by 30% of the total shares of the company at the time of the investment trust of this case, and 30% or more of the shares of the company at the time of the investment trust of this case.

(iii) Article 2 (Definitions);

For the purpose of this Act,

2. The term "mining groups" means that the same person has de facto control over the contents of business according to the following classification as determined by the Presidential Decree:

group of companies means a group of companies;

(a) Where the same person is a company, a group of the same person and one or more companies controlled by the same person;

3. The term "affiliated company" means that where two or more companies belong to the same weather group, each company is called as an affiliated company of the others;

(iv)Article 3 (Scope of Business Groups);

For the purpose of subparagraph 2 of Article 2 of the Act, the term “company whose business contents are in fact controlled according to the criteria as prescribed by the Presidential Decree” means a company falling under any of the following subparagraphs:

1. A company in which the same person holds independently or in concert with another person (hereinafter referred to as the "person related to the same person") falling under any of the following items not less than 30/100 of the total number of stocks issued by the company concerned (excluding non-voting stocks under Article 370 of the Commercial Act; hereafter the same shall apply in this Article, Articles 3-2, 17-5, and 18):

(a) Spouse, blood relatives within the eighth degree, and relatives within the fourth degree (hereinafter referred to as "relative");

(b) A non-profit corporation or organization (referring to an unincorporated association or foundation; hereinafter the same shall apply) to which the same person makes independently or in concert with a person related to the same person not less than 30/100 of contributions as the largest contributor or one of the persons related to the unification or unification who has established;

(c) A non-permanent light or organization in which the same person exercises dominant influence over the composition of executives, business management, etc., directly or through a person related to the same person;

(d) A company whose business activities are substantially controlled by the same person pursuant to this subparagraph or subparagraph (2).

(e) An employee of the same person and a person falling under items (b) through (d) (in cases of a corporation, referring to executives, and commercial employees and employees under an employment contract in cases of an individual

Third, according to Article 2 subparagraph 2 (b) and (3) of the Fair Trade Act, DNA case and RNC already correspond to an affiliate regardless of the title trust of this case, and (4) around May 6, 2004, the supervisor of the National Highway Improvement Construction Corporation that received DDR No. 59 was entrusted with supervision as the TT State Do Maintenance and Construction Office. (5) The plaintiff argued that ParkS holds only 21.80% of the shares of D No. 21.80% and the rest of the shareholders can not be confirmed as the external affiliate because it can be argued that the maximum D No. 16 of the list of shareholders (Evidence No. 16) is the same as the name and address of the LS and that it can be easily confirmed the relationship between the plaintiff, and that it is not reasonable to recognize the legal principles of the CR No. 2067 of the former Enforcement Decree of the Construction Technology Management Corporation's sale of the shares without RS to the new sale of the shares of DD 207.

(4) Determination as to the assertion that there was no tax evaded actually

The plaintiff asserts that even if title trust was made with respect to the shares in this case, there is no secondary tax liability and deemed acquisition tax of oligopolistic shareholders, and other taxes are merely a simple possibility of tax avoidance or a minor reduction of tax.

In light of the following facts: (a) whether or not there was a tax avoidance purpose, and whether or not there was a tax avoidance purpose; (b) the evidence submitted by the Plaintiff alone is insufficient to conclude that the instant shares were not liable to pay global income tax on the dividend income accruing from the possession of the instant shares at the time of title trust to the Plaintiff; (c) the fact that RNC actually did not pay dividends to the Plaintiff; (d) cannot be readily concluded that there was no tax avoidance purpose even at the time of title trust with respect to the instant shares (see Supreme Court Decision 2009Du11348, supra) and (e) the evidence submitted by RNC’s 2004 earned surplus of 200 won, and considering the possibility of dividends such as earned surplus, etc., the Plaintiff did not have any tax amount on the dividend income that could have been avoided through the title trust, or that there was no tax avoidance rate of 201, and that the Plaintiff did not have any disadvantage in the instant shares under the tax law, see Supreme Court Decision 2010Du1904.

Therefore, the plaintiff's assertion on this part is without merit.

3. Conclusion

If so, the plaintiff's claim of this case is dismissed due to the lack of reason, and the judgment of the court of first instance is just, and the plaintiff's appeal is dismissed. It is so decided as per Disposition.