Plaintiff 1 and two others (Bae, Kim & Lee LLC, Attorneys Yu-pon et al., Counsel for the plaintiff-appellant)

Head of the Guro Tax Office and two others

December 19, 2017

Seoul Administrative Court Decision 2015Guhap62842 decided October 22, 2015

Seoul High Court Decision 2015Nu66983 Decided September 2, 2016

Supreme Court Decision 2016Du55049 Decided May 17, 2017

1. All appeals by the Defendants are dismissed.

2. The costs of lawsuit after the appeal shall be borne by the Defendants.

1. Purport of claim

Each gift tax disposition of the Defendants indicated in the attached list of the first instance judgment against the Plaintiffs shall be revoked.

2. Purport of appeal

The judgment of the first instance is revoked, and all the plaintiffs' claims are dismissed.

1. Details of the disposition;

The reasoning of this Court is that the part of the purchase date of Plaintiff 1 in the second part of the judgment of the court of first instance is identical to the corresponding part of the judgment of the court of first instance, except that the part of the purchase date of Plaintiff 1 in the second part of the judgment of the court of first instance as “ December 2, 2003.” Thus, this Court shall accept it in accordance with Article 8(2) of the Administrative Litigation Act and

2. Whether the disposition is lawful;

A. The parties' assertion

1) The plaintiffs

tinbroton does not have any fact of preparing and keeping a register of shareholders under the Commercial Act, and thus, the transfer of the shares of this case at the time of the instant transaction cannot be deemed to have been made. Thus, the deemed donation of title trust under Article 41-2 (1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 7010, Dec. 30, 2003; hereinafter “former Inheritance Tax Act”) cannot be applied to the instant transaction.

In addition, the instant transaction was conducted before January 1, 2004, which was the enforcement date of the former Inheritance Tax and Gift Tax Act (amended by Act No. 8828, Dec. 31, 2007; hereinafter “Revised Inheritance Tax Act”), and thus, it cannot be deemed that the transfer was made in accordance with the statement of changes in stocks, etc. by applying Article 45-2(3) of the amended Inheritance Tax and Gift Tax Act.

In addition, even if the deemed donation of title trust is applied to the instant transaction, the additional payment should be calculated in an amount equivalent to 20/100 of the unpaid tax amount pursuant to Article 78(2) of the former Inheritance and Gift Tax Act.

2) The Defendants

tinbroton submitted a statement of changes in stocks, etc. on March 30, 2004 regarding the instant transaction on March 30, 2004. As such, applying Article 45-2(3) of the revised Inheritance Tax and Gift Tax Act, it can be deemed that the transfer was made in accordance with the statement of changes in stocks, etc. (the grounds for the main disposition).

However, even if it does not so, tinbroton was preparing and keeping a register of shareholders at the time of the instant transaction, so there is a duty to pay gift tax due to the constructive gift of title trust pursuant to Article 41-2(1) of the former Inheritance Tax and Gift Tax Act (the reason for preliminary disposition).

(b) Related statutes;

The reasoning for this Court’s explanation is as stated in the judgment of the court of first instance, except for the addition of the following matters. Thus, this part is cited in accordance with Article 8(2) of the Administrative Litigation Act and the main text of Article 420 of the Civil Procedure Act.

director of the former Commercial Act (amended by Act No. 12591, May 20, 2014)

Article 352 (Particulars to Be Entered in Register of Shareholders)

(1) If a registered share is issued, the register of shareholders shall state the following:

1. Name and address of each shareholder;

2. Class and number of shares held by each shareholder;

2-2. The serial number of share certificates when such share certificates have been issued for shares held by each shareholder;

3. Date of acquisition of each share.

(2) If bearer share certificates are issued, the register of shareholders shall state the class, number, serial number and issuance date of such certificates.

(3) If, in cases of paragraphs (1) and (2), convertible shares are issued, the register of shareholders shall also contain the particulars set forth in Article 347.

(c) Fact of recognition;

1) A non-listed corporation established on December 14, 1990 and owned all the outstanding shares at the time of its establishment. However, at the time of the instant transaction through a merger, around December 1999, and around July 200, the shareholders entered 12 persons. The six of the shareholders and their relatives were the major shareholders and their relatives (class 96.17% of their shares). The remaining six of the six of the shareholders were the executives of tinbrosian tons or their affiliated companies (class 3.83% of their shares). The plaintiffs were the executives of tinbrosian tons or their affiliated companies, and were owned by the shareholders and their families. Nonparty 1 (the shares owned by 32,00,000 shares at the time of its establishment, Nonparty 360 billion won in the name of tinbros or their affiliated companies, Nonparty 1 (the shares purchased by 360 billion won in the name of Nonparty 1, 400,500 billion won in the shares issued by 500.

2) On June 2014, the director of the Seoul Regional Tax Office secured various documents and data, etc. stored in the computers and company servers of the officers and employees of the Seoul Regional Tax Office with respect to the consolidated investigation of corporate tax and stock change of tinbial tons conducted by the director of the Seoul Regional Tax Office. Based on these data, each of the instant dispositions was taken on the basis of these data.

3) The data secured at the time of the above tax investigation was filed by Nonparty 5, who was in custody of tinbro’s executive officers, on a computer, a file (Evidence No. 1; hereinafter “instant document”). However, each shareholder’s number, date of acquisition, reason for acquisition, equity ratio, etc. are recorded from the establishment of tinbro’s tons to the instant transaction (the instant document was prepared by Nonparty 6, a certified public accountant affiliated with tin corporate accounting corporation, and was revised by Nonparty 7, an employee of tinbro’s tons).

4) tinbroton paid cash dividends of KRW 700 million each year from 2003 to 2009 after the instant transaction. In the course of performing a duty to withhold income tax on cash dividends, tinbroton prepared documents stating the names, addresses, resident registration numbers, the number of stocks held, etc. of each shareholder while performing the duty to withhold income tax on cash dividends. Accordingly, tinbroton prepared the documents (Evidence 3) stating the shareholder’s name, number of stocks, dividends, resident registration numbers, addresses, etc. other than the instant documents regarding the instant transaction, other than the instant documents, the document (Evidence 3) stating the shareholder’s name, number of stocks, dividends, resident registration numbers, addresses, etc.

5) Meanwhile, in around 2007, the number of shareholders was increased by 30. Around September 2010, the shareholder registry stating the names, resident registration numbers, addresses, the number of shares, the equity ratio, and the amount of money, etc. of shareholders was prepared. Accordingly, the tinbroton submitted the shareholder registry (No. 11-1) on October 16, 2014 immediately after the reduction of capital due to the reduction of capital at a cost, when the change of capital due to the reduction of capital was registered.

[Ground of recognition] Facts without dispute, Gap 3 through 5, 9, 10, 12 through 19, Eul 1 through 3, 7, 9, 11, each entry, and the purport of the whole pleadings

D. Determination

1) As to the primary reason for disposition

Article 45-2(3) of the amended Inheritance and Gift Tax Act provides that where a list of shareholders is not prepared, a transfer of holders may be determined based on a detailed statement of changes in stocks, etc. but Article 10 of the Addenda provides that the above amended provision shall apply from the submission of a detailed statement of changes in stocks, etc. after January 1, 2004.

The above amended provision is a provision that expands the scope of taxation of gift tax on the stocks held in title trust, and thus, it cannot be applied retroactively. Therefore, the above amended provision is applicable only to the portion of donation for which tax liability is established after January 1, 2004, and the detailed statement of changes in stocks, etc. was submitted, and it cannot be applied to the portion of donation for which tax liability is previously established.

The date of establishment of the duty to pay gift tax is the date of acquisition of donated property, i.e., the date of donation, and the date of establishment of the duty to pay gift tax due to the constructive gift of title trust of stocks, in principle, the date of establishment of the duty to pay gift tax shall be the date of change of ownership. The detailed statement on the state of changes in stocks, etc. submitted on March 30, 200 by tinbros on March 30, 2004 (hereinafter “detailed statement on the state of changes in stocks, etc.”) indicates the state of acquisition of stocks from January 1, 2003 to December 31, 2003. Thus, even according to this, even if the date of change of ownership for the instant transaction can be seen as 203 years, the detailed statement on the state of changes in stocks,

Therefore, by applying Article 45-2(3) of the amended Inheritance and Gift Tax Act to the instant transaction, the entry of a change of holders into the statement of changes in stocks, etc. of this case cannot be deemed as having been made. Therefore, the primary reason for disposal cannot be recognized.

2) As to the conjunctive disposition

A) The transfer of registered shares cannot be asserted against the company unless the name and address of the acquisitor are entered in the register of shareholders. Thus, it constitutes “where the actual owner and the nominal owner are different in property requiring a transfer or exercise of rights” (see, e.g., Supreme Court Decisions 2003Du13762, Feb. 27, 2004; 2005Du10200, Feb. 8, 2007).

B) First of all, as to whether the instant documents, etc. deemed to have been kept in custody at the time of the instant transaction, can be seen as a shareholder registry under the Commercial Act, the form of the books prepared to clarify matters concerning shareholders and stock certificates is not a special restriction, but should include the contents stipulated in Article 352(1) of the former Commercial Act (amended by Act No. 12591, May 20, 2014; hereinafter the same) such as the personal information of shareholders and the number and type of shares held by shareholders.

However, the document of this case appears to have arranged the status of movement of stocks within the extent necessary for the performance of the above business by Nonparty 6, who was delegated with the business of reporting and paying the transfer tax, gift tax, etc. from tinbic tons. The document of this case does not constitute a register of shareholders under the Commercial Act; therefore, the document of this case cannot be deemed to be a register of shareholders under the Commercial Act; and the document of “the cash dividend amount and withholding tax amount in 2004,” in light of its contents and form, etc., it is difficult to view that the document of this case falls under the register of shareholders under the Commercial Act.

C) Next, as tinbroton prepares and keeps the register of shareholders under the Commercial Act at the time of the instant transaction, whether it can be deemed that the same content as that stated in the statement on the change of stocks, etc. in the instant transaction was recorded in the register of shareholders as to the instant transaction, the health care provider bears the burden of proof for the Defendant, who is the tax authority, as a fact of taxation of gift tax based on

Meanwhile, there are cases where it is possible to presume the tax requirement through indirect facts presumed to have been taxed in light of the empirical rule in the specific litigation process. However, even though the imposition of gift tax based on the constructive gift of title trust does not have the substance of the gift, it is permitted to impose gift tax by deeming the relevant property from the actual owner as having been donated to the nominal owner as an exception to the substance over form principle. Therefore, in recognizing the relevant taxation requirement by indirect facts, etc.

이 사건에 대하여 보건대, ㉠ 주식회사는 주식을 발행한 때 주주명부에 주주의 성명과 주소, 각 주주가 가진 주식의 종류와 그 수 등의 사항을 기재하여야 하고( 구 상법 제352조 제1항 ), 배당을 할 때에는 일정한 기간 주주명부의 기재변경을 정지하거나 일정한 날을 기준으로 주주명부에 기재된 주주를 권리자로 정하는 절차를 밟으며( 상법 제354조 제1항 ), 세법상으로도 내국법인은 주주의 성명·주소 등이 적힌 주주명부를 작성하여 갖추어 두어야 할 의무가 있는 점( 법인세법 제118조 ), ㉡ 석영브라이스톤은 이 사건 거래 이전에 여러 차례 유상증자 등을 실시하였고 이미 대주주와 친족관계에 있지 아니한 주주들이 존재하고 있었던바, 주식회사가 유상증자를 실시할 때에는 일정한 날을 정하여 그 날에 주주명부에 기재된 주주가 신주인수권을 가진다는 뜻을 공고하여야 하고( 상법 제418조 제3항 ), 유상증자 등에 의해 주식회사의 자본금이 변경되어 법인등기변경신청을 할 때에는 주주총회의사록과 주주명부를 첨부하여 공증을 받는 경우가 많은 점, ㉢ 석영브라이스톤은 이 사건 거래 직후인 2003년부터 2009년까지 매년 7억 원씩 현금배당을 실시하고 이에 따른 소득세 원천징수의무를 수행하면서 각 주주의 성명과 주소, 주민등록번호, 보유 주식 수 등을 기재한 서류를 정확히 작성해왔으며, 그 외 ‘주식이동현황’이라는 제목의 문서를 작성·관리하면서 설립 이후부터 이 사건 거래에 이르기까지 각 주주의 주식 수, 취득년월일, 취득사유, 지분율 등을 상세히 기록하여 왔던 점, ㉣ 석영브라이스톤이 2014년에 유상감자로 인한 자본금 감소의 변경등기를 하면서 유상감자 직후의 주주명부를 제출하기도 하였던 점 등에 비추어 보면, 석영브라이스톤이 이 사건 거래 당시 주주명부를 작성·비치하였을지 모른다는 의심이 들기도 한다.

However, in full view of the following circumstances acknowledged by the above facts and evidence, it is insufficient to recognize that the above facts charged with the above facts are insufficient to acknowledge that tinbal tons were recorded in the register of shareholders as stated in the Statement on Change in Stocks, etc. at the time of the instant transaction. In addition, even if all the evidence submitted after remand and remand up to the trial, and each fact inquiry about the Seoul Central Court’s registration office and the law firm vision, etc. at the trial after remand, there is no other evidence to prove otherwise (in the course of the additional trial at the trial after remand, it can be confirmed that tinbal tons were in a situation where it is not necessary to prepare and keep the register of shareholders at the time of the instant transaction, and the preliminary disposition cannot be recognized).

① Since the above tax investigation is deemed to have been conducted without prior notice, it is difficult to present the possibility that the shareholder registry was concealed or discarded on the part of tinbroston at the time ( difficult to find out the reason to conceal the title trust in relation to the instant transaction in the tinbroston). Despite the investigation conducted until the file, etc. stored on the computer of tinbrosn employees, the shareholder registry at the time of the instant transaction was not discovered.

② Notwithstanding the above provisions of the Commercial Act and other tax-related Acts, there may be cases where a real necessity for preparing and keeping a register of shareholders is low, and thus, it cannot be presumed as a matter of course that the legal obligation to prepare a register of shareholders has been stipulated and that the register of shareholders has been actually prepared. Moreover, it cannot be readily concluded that a stock company’s management of affairs related to stocks without preparing and keeping a register of shareholders meeting the requirements under the Commercial Act is an exceptional case.

③ Although the shares were already issued at the time of the instant transaction, the shareholders who did not have any relationship with the major shareholders at the time of the instant transaction. However, at the time of the instant transaction, it is difficult to view that the shareholders of tinbrid was a total of 12 shares at the time of the instant transaction. In addition, six of these shares were owned by most major shareholders and their relatives, and the rest six of tinbrid or their affiliated companies were officers, and thus, tinbridton did not have any particular difficulty in handling the affairs related to the shares through the instant document, etc. without the list of shareholders. In addition, in light of the fact that tinbridton was de facto closed unlisted company as seen above at the time of the instant transaction, it is difficult to view that the shareholders of tinbrid as the date of the instant transaction were the date of suspension of the shareholders’ list or the date of change of shareholders’ list pursuant to Article 418(3) of the Commercial Act, it is difficult to view that the shareholders of tinbrid as the date of entry of the shareholders’ list.

④ In light of the fact that the Plaintiffs were executives of tinbroston or affiliated companies, etc., the Plaintiffs, through the instant transaction, did not understand that the Plaintiffs, who acquired a considerable amount of shares of tinbros tons, an unlisted company that is not subject to issuance of stock certificates, did not demand transfer of ownership by the register of shareholders.

⑤ Around December 199 and around July 2000, Hobro’s capital increase. Article 205 of the former Non-Contentious Case Litigation Procedure Act (amended by Act No. 8569, Jul. 27, 2007) which was in force at the time does not stipulate the register of shareholders with documents to be attached to the application form for registration of change due to issuance of new stocks: Provided, That in Article 66-2 of the former Notary Public Act (amended by Act No. 9416, Feb. 6, 2009) of the former Notary Public Act (amended by Act No. 9416, Feb. 6, 2009), there are many cases where the register of shareholders is submitted to verify whether the procedures and contents of the resolution of the general meeting, etc. are consistent with the truth. This is difficult to view that the list of shareholders was prepared in the form of shareholders provided by a notary public under the Commercial Act.

(6) Since it is the time after the instant transaction that tinbroton paid cash dividends, the existence of the shareholder registry at the time of the instant transaction cannot be presumed solely on the ground that tinbroston paid cash dividends as above and prepared the personal information, etc. of each shareholder in the course of performing the income tax withholding duty pursuant thereto. Moreover, even if the shareholder registry under the Commercial Act is not the shareholder registry under the Commercial Act, the said cash dividends and the income tax withholding duty under the said document alone seems to have always been possible.

vii) Since it appears that it was difficult to systematically manage the stock relations, etc. by the instant documents, etc. as before, around 2007, as the number of shareholders increased in around 30 in around 2007, it would have been difficult to keep and maintain a shareholder registry containing the name, resident registration number, address, number of stocks, shares, equity ratio, amount, etc. of shareholders until it reaches September 2010, it can be understood that the shareholder registry was prepared and kept.

3. Conclusion

Therefore, since each disposition of this case is unlawful, the plaintiffs' claim of this case is justified, and the judgment of the court of first instance is justified with this conclusion, and all appeals by the defendants are dismissed.

Judges Doing and decorations (Presiding Judge)