Whether Article 4 (7) of the Enforcement Decree of the Act on Special Rural Development Tax is invalid (negative), and the purport and scope of the provision thereof.

Article 4 (6) 1 of the Enforcement Decree of the Act on the Regulation of Special Rural Development Tax, which provides for the subject of special rural development tax exemption, refers to the Act on the Regulation of Tax Reduction and Exemption, which was enforced as of July 1, 1994, when there is no indication of the number of houses, etc., and Article 35 (4) of the Act on the Regulation of Tax Reduction and Exemption, which provides for the exemption of registration tax when a company subject to industrial rationalization merges in accordance with the standards for industrial rationalization (wholly amended by Act No. 4666 of December 31, 1993) does not provide for special rural development tax exemption, so in the case of such reduction and exemption of registration tax, it shall not be subject to special rural development tax exemption under Article 4 (6) 1 of the Decree. Article 4 (7) of the Decree provides that the above provision shall not be subject to special rural development tax exemption under Article 4 (6) 1 of the Enforcement Decree of the Act on the Regulation of Tax Reduction and Exemption, and it shall not be subject to special rural development tax exemption under Article 7 (4) of the above.

Article 4 subparag. 12 of the Act on Special Rural Development; Article 4(6)1 and (7) of the former Enforcement Decree of the Special Rural Development Tax Act (amended by the Presidential Decree No. 14868 of Dec. 30, 1995); Article 35(4) and Article 46 of the Regulation of Tax Reduction and Exemption Act; Article 17(1) of the Addenda of the same Act

Supreme Court Decision 97Nu5572 delivered on October 24, 1997 (Gong1997Ha, 3689) Supreme Court Decision 97Nu10215 delivered on October 24, 1997

Treatment Heavy Industries Co., Ltd. (Attorney Lee Jong-won, Counsel for defendant-appellant)

The head of Dong-gu Incheon Metropolitan City

Seoul High Court Decision 95Gu16983 delivered on November 29, 1996

The appeal is dismissed. The costs of appeal are assessed against the plaintiff.

The grounds of appeal are examined.

Article 4 subparag. 12 of the Act on Special Rural Development Tax (hereinafter referred to as the "Special Agricultural and Fishing Villages Tax") provides that the special agricultural income tax shall be non-taxable for the purpose of securing national competitiveness, such as technology and human resources development, formation of property of low-income earners, public services, etc., or efficient operation of the national economy, as prescribed by the Presidential Decree. Article 4(6)1 of the Enforcement Decree of the same Act (amended by the Presidential Decree No. 14868 of Dec. 30, 1995; hereinafter referred to as the "Decree") stipulates that the special agricultural income tax shall be non-taxable for the purpose of securing national competitiveness, and Article 4(7) of the Enforcement Decree of the same Act provides that the special agricultural income tax shall not be imposed for any of the "those prescribed by the Presidential Decree as prescribed by the Presidential Decree" under Article 4 subparag. 12 of the Act on the Regulation of Tax Reduction and Exemption (hereinafter referred to as the "Special Agricultural Income Tax") and Article 466(7) of the Decree provides that the corresponding provision of the amended Act shall not apply the special agricultural income tax.

Meanwhile, Article 46(1) of the former Enforcement Decree of the Labor Relations Adjustment Act (amended by Act No. 4666 of Dec. 31, 1993) provides that a company subject to industrial rationalization shall be exempted from registration tax, etc. in cases of a merger in accordance with the standards for industrial rationalization. Article 35(4) of the former Enforcement Decree of the Labor Relations Adjustment Act provides for the same purpose, Article 46 of the former Enforcement Decree provides that a company that transfers a factory to an area outside the Seoul Metropolitan area shall be exempted from income tax or corporate tax, and Article 17(1) of the Addenda provides that the former Enforcement Decree of the Labor Relations Adjustment Act shall apply to a company

According to the provisions of the above related Acts and subordinate statutes, "the Agricultural Special Taxation Act" in Article 4 (6) 1 of the Decree, which provides for non-taxation for agricultural special taxes, refers to the Agricultural Special Taxation Act in force at the time of July 1, 1994, when there is no indication of the number of houses, etc. as long as there is no indication of the law, and Article 35 (4) of the above Act which provides for exemption of registration tax is not provided for non-taxation for agricultural special taxes under Article 4 (6) 1 of the Decree, and Article 4 (7) of the Decree provides for non-taxation for agricultural special taxes under Article 4 (6) 1 of the Decree, and in the case of a merger by a company subject to industrial rationalization in accordance with the standards for industrial rationalization, it shall not be subject to non-taxation for agricultural special taxes under Article 4 (6) 1 of the Decree, and it shall not be subject to non-taxation for agricultural special taxes under Article 4 (6) 1 of the Decree and Article 17 (1) of the above Enforcement Decree.

Therefore, it is proper that the court below determined that the registration tax exempted by the plaintiff pursuant to Article 17 (1) of the Addenda of the above Act and Article 46 (1) of the above Act prior to the above amendment does not constitute non-taxation for agricultural special tax pursuant to the above legal principles, and contrary to the allegations in the grounds of appeal, there are no errors in the misapprehension of legal principles as to the scope of application under Article 17 (1) of the Addenda of the above Act and Article 4 (7) of the Enforcement Decree of the above Act

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

Justices Jeong Jong-ho (Presiding Justice)