1. The defendant's appeal is dismissed.

2. The costs of appeal shall be borne by the Defendant.

Purport of claim and appeal

1...

1. The reasons for the court’s explanation concerning this case are as follows, except for the addition of “determination on the plaintiff’s assertion of the trial” under Article 8(2) of the Administrative Litigation Act and the main sentence of Article 420 of the Civil Procedure Act, and thus, the same shall be cited in accordance with the reasoning for the judgment of the court of first instance.

2. Judgment on the defendant's argument of the trial

A. Although the Defendant alleged that the instant contract was rescinded, G shares subject to transfer under the instant contract still remain in the Plaintiff, and the Plaintiff has the effect of transferring shares in accordance with the instant contract.

Therefore, the instant disposition imposing capital gains tax is lawful, since the substance of the transfer under the instant contract continues to exist, notwithstanding the cancellation thereof.

B. The main text of Article 88(1)3 of the former Income Tax Act (amended by Act No. 8144, Dec. 30, 2006; hereinafter “former Income Tax Act”) provides that “The term “transfer” in Article 4(1)3 and this Chapter means the actual transfer of an asset at a price due to sale, exchange, investment in kind in a corporation, etc., regardless of the registration or enrollment of the asset,” and does not require a contract for sale, exchange, investment in kind, etc., which is the cause of the transfer of asset with compensation (hereinafter “sale, etc.”) to be valid under law.

On the other hand, a contract for sale, etc. was made for the purpose of excluding or evading land transaction permission under the National Land Planning and Utilization Act (hereinafter “National Land Planning Act”) from the beginning, and where a contract between the parties is deemed null and void because it is deemed null and void, a contract between the parties is deemed null and void, and a seller receives and holds the purchase price, etc. as a result of the performance of a contract, such as sale, and thus, the economic benefits ultimately belong to the seller, etc