Plaintiff 1 and two others (Attorney Kim Jae-in, Counsel for the plaintiff-appellant)

Head of the astronomical Tax Office and two others

August 10, 2010

1. On April 15, 2009, the head of the tax office of the astronomical Tax Office imposed a gift tax of KRW 44,670,00 on Plaintiff 1 for the year 2006, and the head of the high tax office imposed a gift tax of KRW 8,415,00 on Plaintiff 2 on April 15, 2009, respectively.

2. The plaintiff 3's claim is dismissed.

3. Of the costs of lawsuit, the part arising between Plaintiff 1 and the director of the Incheon District Tax Office is assessed against the director of the High Military Tax Office; the part arising between Plaintiff 2 and the director of the High Military Tax Office is assessed against the director of the High Military Tax Office; and the part arising between Plaintiff 3 and the director of the High Military Tax Office of

The disposition of imposition of the gift tax amount of KRW 7,650,000 on April 16, 2009, which was imposed on Plaintiff 3 on April 16, 2009 is revoked.

1. Basic facts

A. On April 5, 2006, 2006, the New wind Committee Co., Ltd. (hereinafter “New wind Committee”) was a juristic person established for the construction business, etc., and at the time of its establishment, the register of shareholders submitted at the time of its establishment indicated that Nonparty 1 owns 30,60 shares of the above company, Nonparty 2, Nonparty 30, Nonparty 30, Nonparty 30, Nonparty 30, and Plaintiff 3 owns 10,200 shares.

B. The director of the Seoul Regional Tax Office, from May 16, 2008, conducted a corporate tax and stock change tax investigation on the building wind committee from around 2006 to 2007 business year. On March 31, 2007, on the stock change statement attached to the corporate tax base and tax return submitted by the company on March 31, 2007, he found that the above company's shares were owned by Non-Party 30,600, Non-Party 200, Non-Party 11, 220, Non-Party 20, Non-Party 1, Non-Party 39, 780, and Non-Party 3 held 10,200, and Non-Party 1, Non-Party 1 was a beneficial shareholder, and notified the Defendants of taxation data on the stock change statement.

C. Accordingly, the Defendants applied Article 45-2(1) and (3) of the Inheritance Tax and Gift Tax Act (amended by Act No. 8828 of Dec. 31, 2007; hereinafter the “Act”). On April 15, 2009, the director of the tax office of the Incheonan District Tax Office imposed on Plaintiff 1 the gift tax amounting to 44,670,000 for the year 2006, the director of the tax office of the defendant Yangyang Tax Office imposed on April 15, 2009 the gift tax amounting to 8,415,000 for the year 2006, and the director of the tax office of the defendant Yangyang Tax Office imposed on Plaintiff 3 the gift tax amounting to 7,650,000 for the year 206, respectively.

[Ground of recognition] Facts without dispute, Gap 1 to 3, Eul 1 to 3, Eul 1 and the purport of the whole pleadings

2. Whether each of the dispositions of this case is legitimate

A. The plaintiffs' assertion

As long as the register of shareholders has been issued on the windury area, the transfer of shares should be based on the change of the register of shareholders. In this case, as long as the transfer of shares is not made in the name of the plaintiffs 1 and 2, there is no room for a problem of title trust.

Plaintiff 3 obtained an opportunity to acquire shares of the company upon recognition of the contribution made to the establishment of the new wind committee. However, since the purchase price of shares was only temporarily borrowed from Nonparty 1, it is the actual owner of the new wind committee shares, it is not trusted by Nonparty 1, and even if the title trust is held, it does not constitute a purpose of tax avoidance.

(b) Related statutes;

It is as shown in the attached Form.

C. Determination

1) Whether each disposition against the plaintiff 1 and 2 is legitimate

A) The transfer of registered shares cannot be asserted against the company unless the name and address of an acquisitor are entered in the register of shareholders. Thus, unless a change of ownership is entered in the register of shareholders in the name of another person who is not an actual owner of shares, the transfer of rights, which are the requirement of presumption of donation under Article 43(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 5582 of Dec. 28, 1998), or where a change of ownership is required in the exercise thereof, it cannot be deemed that the actual owner and the nominal owner are different. Since the detailed statement of stocks and equity shares, which are documents to be submitted at the time of reporting the tax base and tax amount of corporate tax, cannot be the same as the list of shareholders, even if the change of shares is stated and reported in the list of stocks and equity shares (see, e.g., Supreme Court Decisions 2003Du13762, Feb. 27, 2004; 93Nu14196, Apr. 31, 1993).

The register of shareholders, which was submitted at the time of establishment of the New Committee, was indicated as holding shares by Nonparty 2, 1, 3, and Nonparty 3. The subsequent statement of changes in stocks, etc. attached to the corporate tax base and tax amount submitted by the Construction Committee around March 31, 2007 by the Construction Committee, was indicated as holding by Nonparty 3, 2, 2, 1, and 3, but there was no dispute between the above parties. According to the above facts of recognition, the shares of the Construction Committee are owned by Nonparty 2, 1, 3, and 3, and the names were transferred to the above plaintiffs. Thus, barring any special circumstance, each disposition of imposition by the Defendants is unlawful on the ground that Nonparty 1 actually owned the shares of the above company and held the shares in the name of the above plaintiffs.

B) As to this, in applying Article 45-2(3) of the Act, where the list of shareholders, etc. is not prepared, the head of the relevant tax office and the head of the relevant high tax office shall determine the transfer by the documents and the statement of changes in stocks, etc. submitted to the head of the relevant tax office. The above provision asserts that “where the list of shareholders, etc. is not prepared,” the “where the list of shareholders, etc. is not prepared” should include even where the list of shareholders exists, the transfer should be included even

In light of the principle of no taxation without law, or the requirements for tax exemption or tax exemption, the interpretation of tax laws shall be interpreted as the text of the law unless there are special circumstances, and it shall not be extensively interpreted or analogically interpreted without reasonable grounds (see, e.g., Supreme Court Decisions 83Nu213, Dec. 27, 1983; 2002Du9537, Jan. 24, 2003; 2002Du6781, May 27, 2004).

Article 45-2(3) of the Act provides that the Inheritance Tax and Gift Tax Act (amended by Act No. 7010 of Dec. 30, 2003) shall apply from the portion of submission of a statement of change of stocks, etc. that is entered as change of shareholder name after January 1, 2004, when a corporation, etc. fails to prepare a register of shareholders, etc., the above provision is newly established so that it can be imposed on the basis of the statement of change of stocks, etc. submitted at the time of filing a report of tax base of corporate tax to supplement the deficiency of taxation because there is no possibility that a change of ownership can be made even if the ownership or transfer of shares is not made, the said provision does not apply to cases where the change of ownership is not entered in the register of shareholders and the list of shareholders, etc.

2) Whether the disposition of imposition against the plaintiff 3 is legitimate

A) At the time of the establishment of the New Committee, the register of shareholders entered the above company’s shares in the non-party 1’s 30,600 shares, the non-party 2’s 30,60 shares, the non-party 3’s 30,600 shares, the non-party 3’s 10,200 shares, and the plaintiff 3’s 10,200 shares as seen earlier. In full view of the overall purport of the pleadings in each of the written evidence Nos. 4 and 1, it is reasonable to deem that the non-party 3 did not pay the purchase price of shares when acquiring 10,20 shares of the New Committee, and instead, the non-party 1 paid the purchase price of shares, and the non-party 3 paid the purchase price of shares, even after the entry in the register of shareholders as above, it can be acknowledged that the non-party 1 did not exercise rights as a shareholder of the New Committee. Thus, barring any special circumstance, the shares of the plaintiff 3 is held in title trust with

As to this, Plaintiff 3 asserted that the payment of shares was made by borrowing from Nonparty 1, and therefore, it is true shareholder. However, there is no evidence to acknowledge that Plaintiff 3 borrowed money from Nonparty 1, and that Plaintiff 3 paid or repaid a certain amount of principal and interest after the above loan. Thus, the above assertion is without merit.

B) In addition, Plaintiff 3 asserts that even if the above entry in the register of shareholders constitutes title trust, there was no purpose of tax avoidance.

The legislative intent of the regulation on deemed donation is to recognize an exception to the principle of substantial taxation to the purport that the act of tax avoidance using the title trust system is effectively prevented, and thereby realizing the tax justice. Thus, only if the purpose of tax avoidance is not included in the purpose of the title trust, the application of the proviso to Article 45-2 (1) shall not be limited to the gift tax prescribed in the proviso, and the burden of proving that there was no purpose of tax avoidance in the title trust (see, e.g., Supreme Court Decision 2003Du13649, Dec. 23, 2004). Article 45-2 (2) of the Act provides that where the property is registered, etc. in the name of another person, the purpose of tax avoidance is presumed to exist in the case where the transfer is not made in the name of the actual owner, etc.

3. Conclusion

Therefore, the imposition of gift tax against the plaintiff 1 and the plaintiff 2 of the Highyang Tax Office of defendant 1 is unlawful, and each of them is revoked, and the claim of this case against the plaintiff 3 against the defendant 3 is dismissed on the ground that it is without merit.

[Attachment Form 5]

Judges Kim Dong-dong (Presiding Judge) and Lee Ho-hoon;