The early appellate court 2013 Jeon 4871

Profit and loss caused by the cancellation of a land sales contract shall be reflected retroactively to the tax base for the year of the original return of corporate tax.

In the event of the cancellation of a land sales contract due to the cancellation of a development plan, the profits and losses therefrom constitute grounds for filing a subsequent claim for correction retroactively reflecting the tax base of the original corporate tax return business year.

Article 40 of the Corporate Tax Act, Article 45-2 of the Framework Act on National Taxes

Daejeon District Court-2014-Gu Partnership-102011 ( October 22, 2015)

Korea ○○○○

Daejeon director of the tax office

November 20, 2014

on December 22, 2015

1. On August 2, 2013, the Defendant’s rejection disposition regarding each corporate tax’s application for rectification stated in the details of filing corporate tax returns and requests for rectification filed by the Plaintiff is revoked.

2. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order of the Gu office.

1. Details of the disposition;

The following facts may be acknowledged if there is no dispute between the parties, or if the whole purport of the pleadings is shown in the statements in Gap evidence of Nos. 1 through 11, 17, 18, 20, 21, 54 (including each number; hereinafter the same shall apply).

(a) Business agreement for development of △△△ International Business District;

(1) On December 13, 2007, the Plaintiff entered into an agreement (hereinafter referred to as the “instant agreement”) with a consortium of AAA and ○○○○○○-ro 3, 40-957, consisting of 26 corporations, including △△, a company specializing in development of the International Business Zone in the ○○ Station Area (hereinafter referred to as the “instant project”). The main contents of the agreement are as follows:

4. The term "land to be traded" means the land of 356,492 square meters which is owned by the plaintiff among the land to be traded; 12. The term "project company" means a corporation established pursuant to Article 51-2 of the Corporate Tax Act as a corporation established by joint investments of the plaintiff (if the Seoul Special Metropolitan City (or the Seoul Special Metropolitan City) and its members in order to promote the project, the Seoul Special Metropolitan City (or the SH Corporation) and the consortium members.

18. The term "land sales contract" means a contract which is concluded between the plaintiff and the project company on the sales of land to be traded by the project company and the purchase by the project company from the plaintiff;

Article 19 (Establishment of Project Companies) ① For the implementation of the Project, the Plaintiff and the consortium members shall establish the Project Company within 15 days from the date of the execution of the Project, meeting the following requirements:

1. The sales contract for the land (hereinafter referred to as the "land subject to preferential sale") equivalent to 5% of the total land to be traded in order to establish a public relations hall for the successful implementation of the project shall be 5% of the total land to be traded after the establishment of the project company, and the sales price shall be 50% of the down payment and intermediate payment, and 50% of the balance, and the project company shall pay the down payment and intermediate payment in cash until December 31, 2007, and shall provide a written guarantee of loans to the project company and financial institutions corresponding to the balance (including interest on installment payments) and shall transfer the ownership of the relevant land to the project company by December 31, 207. The payment deadline for the remaining amount equivalent to the balance paid by the said bill shall be until March 31, 2008. The land subject to preferential sale shall not be until March 31, 2008.

2. The sales contract for the remaining land subject to sale and purchase, excluding the land subject to preferential sale referred to in subparagraph 1, shall be concluded separately by the dividing contract, but the time when the divided sales contract is concluded and the ratio of the land to be traded shall be as follows:

A. 25% of the land to be traded: March 2008

(b) 30% of the land to be traded: 40% of the land to be traded; 40% of the land to be traded: each of the purchase price pursuant to each divided sale and purchase contract set forth in subparagraph 2 of March 3, 2010 shall be paid in installments as follows:

(2) The total purchase price of the land to be traded under paragraph (1) shall be eight trillion won.

(4) The detailed terms and conditions of a land to be traded, which are not stipulated in this Convention, shall be stipulated in a land sales contract.

Article 35 (Cancellation and Termination of the Convention by the Plaintiff) In the event of the occurrence of any of the following causes to the consortium members or the project company (referring to the consortiums and the project company after the project company was established; hereinafter the same shall apply), the Plaintiff may cancel or terminate this Convention by means of a written notice to the consortium members or project company without any separate peremptory notice:

2. Where it is impossible to implement this project due to dishonor, rehabilitation procedures, bankruptcy, etc., it shall be deemed that a land sales contract has been cancelled or terminated without any separate declaration of intention, if this agreement is cancelled or terminated under Articles 38 (Effect of Rescission or Termination of Convention) (4) through 37;

The AAA project financial investment company (hereinafter referred to as the "AA project company") was established around December 18, 2007 in accordance with the Convention, and on December 27, 2007, the AA project company agreed with the Plaintiff on December 27, 2007 to grant immunity from matters that fall under the rights and obligations of the project company stipulated in the Convention.

Secondly, the Plaintiff entered into the first additional agreement on October 28, 2009, the second additional agreement on December 29, 2010, and the third additional agreement on August 1, 2011, respectively, with respect to the instant agreement with AAA project company, including the modification of the timing to enter into the land sales contract and the purchase of Grandmark building.

(1) On December 27, 2007, the Plaintiff: (a) sold 5% of the land subject to the instant project (area 18,494.5m2) to 4,15 billion won; (b) on March 31, 208, 25% of the land subject to the instant project (area 89,123m2) to 2 trillion won; (c) on December 30, 2008; and (d) on December 28, 201, the second sale and purchase contract for the land of 20 billion won (area 18,494m2; and (d) on December 30, 2008; and (e) on December 16, 201, the second sale and purchase contract for the land of 20 billion won and the second sale and purchase contract for the land of 20 billion won and the second sale and sale contract for the land of 30% of the area subject to the instant project (area 16, 207, 19309.3m2).3 p.

Article 12 (Cancellation of Contracts) (1) In the event that any of the following events occurs to a party (hereinafter referred to as "party to obligation") before the implementation of this Agreement is completed, the other party to the contract (hereinafter referred to as "person entitled to rescission") may rescind this Agreement by sending written notice to the other party:

(a) Where it is found that the statement and guarantee details of the responsible party are different from the fact, that the content of the violation is impossible to correct the violation, or where the content of the violation is able to correct it, if the content of the violation is corrected, it is impossible to correct it within ten days after the written notification of the person demanding the right to cancel is delivered;

(b) Where procedures for dishonor, bankruptcy, or rehabilitation are commenced by a party to the case of a party to the case;

(3) Where the instant agreement has been lawfully rescinded or terminated, it shall be deemed that the said agreement has been rescinded without any separate declaration of intention in accordance with Article 38(4) of the said Convention.

The Plaintiff completed the registration of ownership transfer of the entire land subject to the instant project in the AAA project company in a total of five times ( ① December 31, 2007, ② June 17, 2008, ③ December 29, 2009, ⑤ December 29, 2010, and ⑤ September 30, 201) in accordance with each land sales contract of this case. The Plaintiff reported and paid the corporate tax by reporting and paying the corporate tax from 2007 to 2011, as stated in the separate sheet, based on the inclusion of the transfer amount of the land subject to the instant project in the gross income and the inclusion of the book value in the calculation of deductible expenses.

D. Notice of the cancellation of the instant agreement and the land sales contract

(1) On April 23, 2013, the Plaintiff notified that “AAAA project company was unable to correct the violation of the obligation to pay the purchase price of the third, 4-1, and 4-2 land, and that the loan of the loan agreement that has lost the benefit of time is not able to repay, and thus, the Plaintiff’s cancellation of the contract for the sale of the third, 4-1, 4-2 land pursuant to Article 12(1)(a) and (b) of the purchase and sale of each of the instant land and Article 546 of the Civil Act.” At that time, the subject matter of the purchase and sale of the third, 4-1, 4-2 land is the subject matter of the instant contract for the sale of the third, 4-1, and 4-2 land, which is part of the land subject to the instant project, and the registration of ownership transfer was completed in the name of the Plaintiff on the ground of the attribution of trust property.

on April 29, 2013, the Plaintiff: (a) on April 29, 2013, the AAA project company and its shareholders lose the benefit of the terms of the loan agreement; (b) on the rescission of the contract for the sale and purchase of each land, the ownership of the land, which is the subject matter of the sale and purchase of each land, was restored to the Plaintiff; and (c) on the grounds that the AA project company failed to pay taxes and commenced the public auction procedure for the land subject to the project in this case. Since it was impossible for the AA project company to continue to implement the project in this case, the Plaintiff notified the 3A project company and its shareholders of the cancellation of the said agreement pursuant to Article 35(2) of the instant Convention. (e) The Plaintiff notified the request for rectification of corporate tax and the

(1) On June 4, 2013, the Plaintiff revised the tax base and calculated tax for the business year from 2007 to 2011 to 2011 of the pertinent business year based on the retroactive effect of the cancellation, and filed a request for correction to refund the corporate tax amount equivalent to the amount stated in the "calculated tax amount of the "calculated tax amount of the" item of the corresponding difference by reducing the tax base and calculated tax amount for the business year from 2007 to 2011 as stated in the "justifiable tax amount of the report of corporate tax and the details of the request for correction" as stated in the "justifiable tax amount of the report of corporate tax and the statement of the request for correction."

She, however, the defendant rejected the plaintiff's request for correction on August 2, 2013 on the ground that the time when profits and losses accrued from the cancellation of each land sales contract in this case belongs to the business year of 2013, which belongs to the date of cancellation of the contract (hereinafter "the disposition in this case").

Article 22(1) of the Civil Procedure Act (amended by Act No. 1283, Jun. 25, 2014); and Article 22(1) of the Civil Procedure Act (amended by Act No. 11835, Oct. 25, 2013)

A. Summary of the plaintiff's assertion

(i) The sales contract for land Nos. 3, 4-1, and 4-2 is subject to the Plaintiff’s notice of cancellation on April 23, 2013.

In accordance with the plaintiff's notification of cancellation on April 29, 2013, the business agreement of this case was lawfully rescinded.

The purchase and sale contract for the first and second lands due to the lawful cancellation shall be in accordance with Article 38(4) of the Business Convention.

In the end, each of the instant land sales contracts was terminated.

The Plaintiff’s income from the transfer of land subject to the instant project, in accordance with the retroactive effect of the rescission of the sales contract of each of the instant land, was the same as that of the beginning, and thus, it is deemed that the ground for filing a subsequent claim for correction regarding the Plaintiff’s corporate tax liability that was established due to the transfer of the instant land occurred. Therefore, the profit and loss following the cancellation of the sales contract of each of the instant land should be retroactively reverted to the business year that was established at the time of the completion of the registration of transfer of ownership under each of the instant land sales contract.

B. Relevant statutes

It is as shown in the attached Form.

C. The judgment of this Court

(i)Recognitions

The following facts may be acknowledged if there is no dispute between the parties, or if the whole purport of the pleadings is added to each entry in Gap evidence Nos. 12 through 18, and 54.

① In order to raise the price, etc. for each of the instant land sales contracts, AAA project company has borrowed a total of KRW 2:4,363 billion (excluding the 9th loan, which was made in the form of exchanging the first loan, inasmuch as only the parent of the actual loan is the intention) on nine occasions from November 27, 2009 to March 9, 2012 as listed below from several financial institutions, such as Han Bank, etc. (hereinafter referred to as “substitute”) to raise funds for each of the instant land sales contracts. The principal and interest of the loans as of the date of separate conclusion of the contract is the 209-11-278,50 billion won - the first and second land sales contracts related to each of the first and second land sales contracts:

- 2010-09-28 19.6 billion won for the second loan - Related to the third land sales contract;

- - 3rd redemption 2010-11-29-29 6,55 billion won on November 2012 - 4th 201-282, 201-2792 - 1,86.7 billion won on each third land sales contract - 5th 201-06-13 - 66.1 billion won on each third land sales contract - 4th 201-08-16.6th 201-16. - 3,64.2 billion won on each third land sales contract - 8th 201-11-282,792-3, 4-1, 4-2, 4-2, 4-2, 4-300 million won on each of the third land sales contracts - 8th 201-11-282, 2000 million won on each of the third land sales contracts - 2012-30309-405.

* The meaning of the part in which a specific loan agreement is related to a specific land sales contract in the remarks column is that the land which is the object of the relevant land sales contract was provided as a security for a loan under the relevant loan agreement (see Article 11 of the loan agreement), and that the relevant loan agreement was concluded to raise the purchase price of the relevant land sales contract.

② At the time of the conclusion of each of the above loans arrangements, AAA project company entered into a real estate security trust agreement (hereinafter referred to as “instant security trust agreement”) with BB trust company (hereinafter referred to as “BB trust”) in order to secure each of the loans to the lender of △ Project Company under the above loan agreements. The truster and debtor of the instant security trust agreement are AA project companies, and the trustee is BBB trust, the first beneficiary is the lender, the second beneficiary is the plaintiff, and the second beneficiary is the subject of each of the instant land sales contracts. The relevant part of the instant security trust agreement is as follows.

4.The claims secured by the preferential beneficiary under Section 6 (mortgaged Claim) of the Special Agreement shall be:

1. Claim secured by the lender: The principal, interest, delay damages, and all other monetary claims that the lender holds against the AA project company in accordance with the loan agreement;

2. The Plaintiff’s secured claim: In the event that the instant agreement is terminated, the Plaintiff’s secured claim shall be notified immediately to the BBB Trust, and the lender may notify the Plaintiff of the occurrence of the cause for the following measures within 85 days, as stipulated in the BB Trust Agreement, in accordance with the provisions of Annex III (AB Trust) of the claim for ownership transfer registration against the trusted real estate held by the Plaintiff to ABA project company (a trust ownership transfer, etc.) (1) of the claim for ownership transfer registration against the trust real estate held by the Plaintiff. In the event that the BB Trust complies with such notification or is notified of the occurrence of the cause for return from the Plaintiff, BB Trust shall complete the following measures:

1.BB Trust shall provide all documents necessary for the registration of ownership transfer of the trusted real estate to the Plaintiff on the ground of the attribution of the trust property upon termination of the trust (Provided, That where a timely cooperation, such as document collection, is not possible from a AA Project Company, it shall be based on the choice of BB Trust).

2.BB Trust shall be paid in cash from the Plaintiff (the amount is different according to the loan amount of each loan agreement relating to each collateral trust agreement) in the trust account as stipulated in the agreement.

③ At the time of the conclusion of each of the above loans arrangements between AAA project companies, in order to secure the obligation to return each loan to the lender of the AA project company, the AA project company has made an agreement on the reversion of each land and the refund of each price (hereinafter referred to as the “agreement on the refund, etc. of the price of this case”) with the land trust with the plaintiff and the land trust with the plaintiff, and the relevant parts of this case are

Article 4 (Measures to be Taken in Event of Reversion) (1) If any of the grounds set forth in the subparagraphs of Annex III (Grounds for Reversion) occurs, the BBB Trust or the Plaintiff may notify the other parties of the occurrence of such grounds, and each party shall complete the following measures within 85 days from the date on which the notification is sent:

1. BB trust is due to the attribution of trust property upon termination of the trust (Provided, That where a timely cooperation, such as document collection, is not possible from a AAA project company, due to the choice of BB trust), the BB trust will deliver all documents necessary for the registration of ownership transfer of trust property to the Plaintiff, and the Plaintiff will immediately file an application for the registration of ownership transfer.

2. As a simultaneous implementation with subparagraph 2, the Plaintiff shall pay ○○ won in cash in a deposit account designated by the trust company. (2) With respect to all legal relations between the Plaintiff and AAA project companies under the instant agreement, the transfer of ownership of the land subject to BB trust under Article 4 shall be deemed to have been returned to the dlimb project in accordance with Article 38 of the instant Convention, and the Plaintiff’s payment under Article 4 shall be deemed to have been returned in accordance with Article 38 of the instant Convention.

Annex III (Reasons for Reversion Return)

2. Where any of the following events occurs in connection with a loan agreement:

(a) Where, for any reason, a AAA project company has not fully or partially paid the amount to be paid to the lender under the loan agreement (as defined in the loan agreement) by the relevant payment date;

④ On March 12, 2013, AAA project company lost the benefit of each loan agreement due to the failure to pay interest under the said 9th loan agreement to the lender 5.2 billion won.

Accordingly, AAA project company shall notify the BBB trust, and BB trust shall be subject to the Plaintiff on March 14, 2013, of the occurrence of the grounds for reversion under Annex III subparagraph 2 (a) of the Agreement on the Return of Proceeds, etc., and requested the Plaintiff to implement the measures under Article 4 of the said Agreement and Article 7 (1) of the Special Agreement on Security Trust.

⑤ On April 11, 2013, pursuant to Article 4 of the Agreement on the Return of Proceeds, etc. in this case and Article 7 of the Special Agreement on Security Trust Agreement, the Plaintiff paid KRW 5,47,00,00,000,000,000,000 for the aggregate of loans of 4,5,6, and 8 to BB trust. On April 11, 2013, the Plaintiff paid the Plaintiff the loans of 4,5,6, and 8 to BB trust. Accordingly, the Plaintiff failed to pay the Plaintiff part of the purchase price for each of the above loans of 3,4-1, and 4-2 to the Plaintiff under each of the above land sales contracts. Moreover, the failure of the AAA project company to pay interest under each of the instant 9 loans constitutes a default project hub company. Accordingly, each of the above land sales contracts was revoked by the Plaintiff within 10 days pursuant to each of the above subparagraphs 12(b) of Article 12(1) of the Land Sales Contracts.

Whether the contract for each of the instant lands was rescinded

In full view of the facts acknowledged earlier, the Plaintiff was unable to pay interest under the 9th loan agreement and lost the interest under the 19th loan agreement, and the Plaintiff was required to pay part of the loan obligations to the lender of the AAA project according to the agreement on the refund of the price, etc. of this case. As a result, the AAAA project project operator returned part of the purchase price to the Plaintiff pursuant to Article 8(2) of the said agreement, and the AAA project company failed to implement the said obligation despite the obligation to re-paid the above amount returned to the Plaintiff. Therefore, the cancellation of the 3,4-1, 4-2 sales agreement and the instant agreement on the ground of the nonperformance of the obligation of the AA project company is lawful and valid, and the 1,202 sales agreement and the 12(3) of each of the instant land sales contract were legally rescinded as the rescission of the instant agreement.

【Post-ex Post Facto Correction Grounds

Article 40(1) of the Corporate Tax Act provides that “The business year to which gains and losses of a domestic corporation accrue shall be the business year to which the date on which the income and losses are determined belongs” shall be deemed as realizing the income when the rights that form the basis of the income have not been actually accrued, and adopts the so-called principle of confirmation of rights to taxable income. In such a case where there is time interval between the time when the rights that form the basis of the income and the time when the income are realized, the rights that are the basis of the income are not the time when the income is determined and the time when the income is realized shall be deemed as the time when the rights that accrue, not the time when the income is realized, and in such a way as calculating the income for the pertinent business year, the tax liability initially established shall be deemed as not only the time when the rights that form the basis of the income and the time when the income is determined, but also the time when the income was actually realized, on the premise that it would be realized in the future. Therefore, if the tax liability becomes final and conclusive due to the occurrence of a certain later cause for cancellation, it accords with the legislative purpose of Article 25(2).

In the event of a circumstance, such cancellation of a contract cannot affect the tax liability that was initially established, and thus cannot serve as a ground for filing a subsequent claim for correction (see, e.g., Supreme Court Decisions 2011Du1245, Dec. 26, 2013; 2012Du10611, Mar. 13, 2014). Based on the foregoing legal doctrine, the health class and the sales contract of each of the instant land were lawfully rescinded. As seen earlier, the income acquired by the Plaintiff from the transfer of land subject to the instant contract pursuant to each of the instant land sales contract becomes final and conclusive as it is not realized due to the occurrence of a subsequent event, i.e., rescission of a contract by exercise of the right to rescission., this constitutes a ground for filing a subsequent claim for correction as prescribed in Article 25-2 subparagraph 2 of the Enforcement Decree of the Framework Act

Applicant Judgment on the defendant's argument (the existence of special circumstances)

㈎ 피고 주장의 요지

Considering that the Civil Act provides that any change in real rights shall take effect in the registration, and that the Enforcement Decree of the Corporate Tax Act sets the date on which the ownership transfer registration has been completed even before the real estate was paid at the time of the transfer of the real estate as the time to vest in the profit and loss, the cancellation of the sale and purchase contract cannot be a ground for filing a subsequent claim for correction if the ownership transfer registration has not been completed due to the restoration of the original state. However, the cancellation of the sale and purchase contract cannot be a ground for filing a subsequent claim for correction, even if the ownership transfer registration has yet to be completed due to the cancellation of the sale and purchase contract of each of the instant land. However, the registration of ownership transfer for the entire land subject to the instant project has not yet been completed in the future of the Plaintiff, and it is practically impossible for the Plaintiff to reinstate due to

㈏ 위 주장에 대한 판단

Article 68(1)3 of the Enforcement Decree of the Corporate Tax Act provides that the date on which the ownership transfer registration is completed shall be the date on which the profit or loss accrues even before the transfer of real estate pursuant to the real estate sales contract, and it shall be deemed that the transfer of real estate takes place at the time of the cancellation of the real estate sales contract, as a matter of course, that the real right, which was changed to the execution of the contract, is returned to the state in which the contract was not concluded (see, e.g., Supreme Court Decision 94Da1881, May 12, 1995). Even though the cancellation of the ownership transfer registration under each of the instant land sales contract was not completed, each of the instant land sales contract was lawfully rescinded and thus the real right is returned to the State without relation to the registration. Furthermore, Article 68(1)3 of the Enforcement Decree of the Corporate Tax Act provides that the date on which the ownership transfer registration is completed shall be deemed the date on which the profit or loss accrues, and it shall not be deemed that the aforementioned provision is not separately provided for the grounds for correction.

In addition, even if a third party who acquired a new right to the land subject to the instant project based on each of the instant land sales contracts and thus, the Plaintiff’s restoration is limited, from the Plaintiff’s standpoint, each of the instant land sales contracts becomes retroactively null and void, and accordingly, the income accrued from the transfer of the land subject to the instant project is not realized. Therefore, there is no difference between the case of the said third party and the case of the said third party, and thus, it is difficult to view that there exists a third party whose effect of rescission is restricted, as a special reason to deny

(v)the theory of smallity;

Therefore, the effect of the cancellation of each of the instant land sales contracts ought to be retroactively attributed to the business year to which the time of conclusion of the contract belongs. Therefore, the instant disposition is unlawful.

3. Conclusion

Therefore, the plaintiff's claim of this case is reasonable, and it is so decided as per Disposition by admitting it.