The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Article 2(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 8828, Dec. 31, 2007; hereinafter “the Act”) provides that gift tax shall be imposed on donated property from another person’s donation. Article 2(3) of the former Inheritance Tax and Gift Tax Act provides that “The term “donation” means a free transfer (including a transfer at a remarkably low price) of, or an increase in, another’s property value by directly or indirectly, any tangible or intangible property, the economic value of which can be calculated, regardless of the name, form, purpose, etc. of the relevant act or transaction, means a free transfer (including a transfer at a remarkably low price) of, or an increase in, another person’s property value.” Article 31(1) of the Act provides that “The donated property provided for in Article 2 includes all things belonging to the donee and all de facto

Article 41(1) of the Act provides that where a person who has a special relationship with a shareholder or investor (hereinafter referred to as "shareholders, etc.") of a corporation under suspension or closure of business (hereinafter referred to as "specific corporation") obtains profits from the shareholder, etc. of a specific corporation through transactions falling under any of the following subparagraphs with the specific corporation, the amount equivalent to such profits shall be deemed the value of the property donated to the shareholder, etc. of the specific corporation, etc.

In addition to donations under Articles 33 through 41, 41-3 through 41-5, 44 and 45 of the Act, where profits falling under any of the following subparagraphs and above the standard prescribed by the Presidential Decree have been acquired, such profits shall be the relevant profits: