There are reasonable grounds for government-invested corporations which have not used acquired land for its original purpose due to restrictions on construction and delay in budget approval;

If the Plaintiff Corporation (Korea Electric Power Corporation) fails to construct a company house, etc. on the land that it acquired in order to build a company house or a dormitory for its employees for the said six months after its acquisition, even after May 12, 1981 at the time of the taxation of this case, the restriction on construction of the public building and the commercial building of the construction division continued until the end of December 1979, and the Plaintiff Corporation, a government-invested institution, obtained an approval on the government's budget for the said construction in accordance with the Budget and Accounts Act, there is a justifiable reason for not being used directly for its proper purpose.

Article 10(1) of the former Regulation of Tax Reduction and Exemption Act; Article 84-3 subparag. 3 of the former Enforcement Decree of the Local Tax Act; Article 142(1) of the former Enforcement Decree of the Local Tax Act; Article 75-2 subparag.

Korea Electric Power Corporation

Korea Electric Power Corporation et al., Counsel for defendant

Msan City Mayor (Attorney Lee Young-young et al., Counsel for defendant-appellee)

Daegu High Court Decision 81Gu191 delivered on February 8, 1983

The appeal is dismissed.

The costs of appeal shall be borne by the defendant.

The grounds of appeal are examined.

1. Article 10(1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3102, Dec. 5, 1978) stipulates that any property acquired by a corporation under any subparagraph of Article 4(1) shall be exempted from the acquisition tax to use directly for its proper business (Article 4(1)35 of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3196, Dec. 28, 1979) shall specify the Plaintiff corporation (Article 10(1) of the former Regulation of Tax Reduction and Exemption Act, amended by Act No. 3196 of Dec. 28, 1979).

However, there is no provision on the definition of business or non-business use of a corporation under the Local Tax Act. Accordingly, according to Article 84-3 Item 3, Article 142 (1) Item 1, Item 7 (d), and Article 75-2 Item 1 of the Enforcement Rule of the Local Tax Act (amended by Ordinance of the Ministry of Home Affairs No. 280 of January 23, 1979), land which is not directly used for its proper purpose (the purpose of business under the Act or the articles of incorporation) within 6 months from the date of its acquisition shall be land for non-business use of a corporation without a justifiable reason. However, it provides that the land acquired by a corporation for construction of company houses, dormitories, dormitories, etc. to be used for the residence of employees shall not be deemed land for non-business use of a corporation for which 6 months have not passed since the date of its acquisition.

According to the records, it can be recognized that the land in this case is purchased for the construction of the company houses and dormitories for the employees of the plaintiff corporation. In this case, the land in this case is used directly for the original purpose of the plaintiff corporation at the time of its acquisition, and the acquisition tax is exempted in accordance with the Regulation of Tax Reduction and Exemption Act.

However, according to the records, the plaintiff corporation's construction restriction measures for public buildings and commercial buildings were continued until the end of December 1979, and the plaintiff corporation's construction restriction measures for public buildings and commercial buildings continued to obtain the government's budget approval for the above construction under the Budget and Accounts Act, since it is evident that the above company had not constructed the above company house and dormitory, and there were justifiable reasons for not using the building directly for its own purpose, according to the records, the plaintiff corporation is a corporation established by investment from the whole government, which is incorporated by the whole government, as well as the government's approval for the budget, and its execution shall follow the government's order.

Under this view, the decision of the court below that revoked the defendant's taxation based on the premise that the land in this case is non-business use will be justified, and it cannot be said that there is a violation of the rules of evidence such as the theory of lawsuit and a misunderstanding of legal principles.

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 Jeon Soo-hee (Presiding Justice)