Whether the accumulation of reserves for corporate rationalization under Article 16 of the former Regulation of Tax Reduction and Exemption Act is a prior implementation requirement for corporate tax reduction and exemption.

The reserve for corporate rationalization prescribed in Article 16 of the former Regulation of Tax Reduction and Exemption Act is not a requirement to be implemented first to obtain corporate tax reduction or exemption, but a person who has been exempted or deducted after obtaining corporate tax reduction or exemption is required to be performed at the time of disposal of profit in the business year so exempted or deducted, and is merely a requirement to avoid additional collection equivalent to the amount of tax reduction or exemption.

Article 16 of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3102, Dec. 5, 1978); Article 91 of the Regulation of Tax Reduction and Exemption Act

Supreme Court en banc Decision 79Nu403 Decided February 10, 1981 82Nu462 Decided March 22, 1983

Taeyang Tourism Tour Corporation

The director of the tax office

Seoul High Court Decision 81Gu220 delivered on January 19, 1982

The appeal is dismissed.

The costs of appeal shall be borne by the defendant.

The grounds of appeal by the defendant litigant are examined.

According to the judgment of the court below, the court below acknowledged that the plaintiff company was a domestic corporation for the purpose of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the business of the plaintiff, but the defendant did not accumulate the above amount of the amount of the income deducted as the amount of the income deducted as the corporate tax of the business of the business of the business of the business of the business of the business of the business of the business of the corporation of the business of the business of the business of the business of the business of the business of the business of the business of the business of the above.

Article 4-2(1) of the Regulation of Tax Reduction and Exemption Act (amended by Act No. 3102, Dec. 5, 1978); Article 24-5(1) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 9232, Dec. 30, 1978) and Article 68 of the Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 9232, Dec. 30, 1978), if a domestic corporation falling under a small or medium enterprise under the above provision of Article 4-2(2) of the same Act intends to receive a deduction from the income amount for the business year which includes the date on which the change of its capital is registered, it shall be deemed that the corporation has received an application for deduction of capital income based on the prescribed form in Article 2-5(4) of the above Enforcement Decree of the same Act, and it shall be deemed that the person subject to reduction and exemption or exemption of corporate tax for the purpose of the reduction and exemption or exemption of corporate tax (see Article 17 of the same Act).

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

Justices Shin Jong-young (Presiding Justice)