The calculated tax amount based on the standard market price shall not exceed the gains on transfer based on the actual transaction price.

In the case of calculating the transfer margin based on the standard market price, the tax amount calculated based on the principle of substantial no taxation without law or prohibition of excessive taxation under the Constitution shall not exceed the scope of the transfer margin based on the actual transaction price.

Article 114 of the Income Tax Act: Determination, rectification, and notification of capital gains tax bases and tax amounts;

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

A. The Defendant’s disposition of imposing capital gains tax of KRW 68,342,70 on the Plaintiff on June 10, 200, which exceeds KRW 61,907,212, shall be revoked.

B. The plaintiff's remaining claims are dismissed.

2. The total costs of the lawsuit are ten minutes with an objection, one of which is to be borne by the defendant, and the other is to be borne by the plaintiff.

1. Purport of claim

The Defendant’s disposition of imposition of capital gains tax of KRW 68,342,700 against the Plaintiff on June 10, 2003 is revoked.

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. Details of the disposition;

A. On June 12, 1991, the Plaintiff purchased a building site of 266.99 square meters and the second floor of 218.29 square meters from the building site of ○○○-dong, Seoul, 27-9, and transferred the building site to ○○-gu on December 15, 200, after purchasing the building site of 218.29 square meters from ○○-dong, Seoul, and then transferring the building site to ○○-○ on December 15, 200.

B. On February 6, 2001, the Plaintiff calculated capital gains tax from the transfer of the instant real estate at the actual transaction price (acquisition price of KRW 290 million, transfer price of KRW 345 million, transfer price of KRW 350 million), and paid KRW 6,531,240 as capital gains tax on February 6, 2001.

C. However, on June 21, 2003, the Defendant issued a disposition imposing an occasional transfer income tax of KRW 68,342,700 on the Plaintiff on the ground that the actual transfer value is confirmed as KRW 490,000,000 (hereinafter “instant disposition”).

(Evidence) Evidence Nos. 1, 3, 1, 1, and 1, and the purport of the whole pleadings

2. Determination on the legitimacy of the instant disposition

A. The plaintiff's assertion

The actual transfer value is 490,000 won, not the 290,000 won reported by the Plaintiff, but the actual acquisition value is 440,000,000 won, so the transfer margin following the transfer of the real estate of this case is 50,000 won, and accordingly, the disposition of this case on the premise that the above transfer margin exceeds 50,000 won, should be revoked.

(b) Related statutes;

Income Tax Act (amended by Act No. 6292 of October 29, 2000)

Article 94 (Scope of Transfer Income)

Capital gains shall be the following incomes generated in the current year:

1. Income accruing from transferring buildings or land;

Article 96 (Value of Transfer)

(1) The transfer value of assets under subparagraphs 1 and 2 of Article 94 shall be based on the market price as at the time of transfer of the relevant assets: Provided, That where the relevant assets fall under any of the following subparagraphs, it shall be based on the actual transaction price:

6. Where the transferor reports the actual transaction price at the time of transfer and acquisition to the head of tax office having jurisdiction over the place of tax payment by the deadline for final return under Article 110 (1), together

Article 97 (Calculation of Necessary Expenses in Transfer Income)

(1) In calculating gains on transfer of a resident, necessary expenses to be deducted from the transfer value shall be as follows:

1. Acquisition value:

(a) In cases of assets under subparagraphs 1 and 2 of Article 94, the standard market price at the time of acquisition of the relevant assets: Provided, That in cases where the relevant assets fall under any subparagraph of Article 96 (1), it shall be based on the actual transaction price required for the acquisition of such assets;

§ 100. Calculation of gains on transfer

(1) In the calculation of gains on transfer, when the transfer value is calculated based on the actual market price (including the value referred to in Article 96 (3) and the value of business example, appraisal value, etc. other than the standard market price from among the values referred to in Article 114 (5)), the acquisition value shall also be calculated based on the actual market price (including the value referred to in Article 97 (7) and the value referred to in Article 114 (5) other than the standard market price), and when the transfer value is calculated based on the standard market price, the acquisition value shall also be calculated based on the standard market price (including the value referred to in Article

(c) Fact of recognition;

(1) On May 14, 191, the remaining ○○, a licensed real estate agent, who arranged for the sale and purchase of the instant real estate at the request of Kim○-○ and Noh○○○, was found to have reported the rapid sales advertisement published in the economic daily newspapers and recommended the Plaintiff to purchase the instant real estate.

(2) Accordingly, on May 17, 1991, the Plaintiff concluded a sales contract stating that “The purchase price of KRW 440 million, down payment of KRW 60 million, and down payment of KRW 60 million shall be paid on the contractual day, and the remainder of KRW 380 million shall be paid on June 12, 1991 without intermediate payment, on condition that the Plaintiff shall receive KRW 70 million as the monthly rent repayment obligation and deduct it from the balance.”

(3) The remaining ○○, who arranged the above sales contract, received each of the KRW 31 million after deducting the monthly rent from the Plaintiff’s deposit on the day of the contract and the remainder payment date, and delivered it to Kim○-○ and Nowon-○○.

(4) On the other hand, the transfer value, acquisition value, necessary expenses, transfer margin, etc. of the instant real estate based on the standard market price are as indicated in the calculation statement of transfer income tax (hereinafter “the instant specification”) in the annexed sheet of calculation of transfer income tax.

(In fact that there is no dispute, Gap's evidence Nos. 8, 11, 12, 9-1, 2, 10-3, Eul's evidence Nos. 2, 3-4, 7-5, each statement of Nos. 1, 7-5, and testimony and change of the witness of the court of first instance.

D. Determination

(1) Calculation of transfer margin based on the standard market price

If the value reported by the transferor at the time of the preliminary return of transfer margin or the final return of tax base of certain assets is confirmed to be the actual transaction value, the transfer margin shall be calculated based on the actual transfer and acquisition value. However, even if there is no such report or the reported value is not verified to be the actual transaction value, the transfer margin shall be calculated based on the standard market price. Although the actual transaction value is confirmed differently, it shall not be based on the actual transaction value (see, e.g., Supreme Court Decisions 95Nu13807, May 10, 1996; 99Du9421, Apr. 25, 2000). Thus, the transfer income tax of this case shall be calculated based on the standard market price of the real estate of this case as the real transaction value reported by the Plaintiff as the actual transfer value of the real estate of this case is not the actual transfer value, but the actual transfer value of 4.9 million won is not a dispute between the parties

Therefore, the instant disposition that was imposed by calculating the transfer margin based on the actual transaction price rather than the standard market price of the real estate of this case is unlawful.

(2) The due amount of tax

Even in cases where transfer margin is calculated based on the standard market price, it cannot exceed the scope of the transfer margin based on the actual transaction price (see, e.g., Supreme Court Decisions 96Nu4022, Dec. 10, 1996; 96Nu860, Feb. 11, 1997; 2001Du5026, May 30, 2003: Provided, That the transfer margin calculated based on the standard market price per se cannot exceed the scope of the transfer margin based on the actual transaction price). Accordingly, in this case, the Plaintiff’s legitimate tax amount to be borne by the Plaintiff in accordance with the above legal doctrine is considered as having been recognized as having the actual acquisition value of the real estate of this case in KRW 440 million.

However, the amount of tax calculated on the basis of the standard market price of the real estate of this case exceeds gains from transfer based on the actual transaction price as KRW 61,508,879, which is indicated in the “justifiable Tax Amount” column of Article 11 of the Notice of this case. Thus, if a reasonable tax amount is calculated on the basis that the amount of tax corresponding to the above gains from transfer exceeds gains from transfer based on the actual transaction price, the amount of tax shall be KRW 50,000,000,000 in the “justifiable Tax Amount” column

3. Conclusion

Therefore, since the part exceeding KRW 61,907,212 of the disposition of this case is unlawful, the plaintiff's claim seeking the revocation of the disposition of this case is accepted within the scope of the above recognition, and the remaining claim is dismissed as it is without merit. The judgment of the court of first instance is erroneous as it is so decided as per Disposition with the intention to modify it, since it is part of the conclusion different.