"Land category under the Cadastral Act" in Article 46-3 of the former Enforcement Decree of the Income Tax Act means land.

In light of the fact that there is only a land category of “site” under the intellectual law without a separate category, and the land category under the intellectual law is determined according to a certain standard and registered in the cadastral record by the competent authority, it is reasonable to set off that the land category “site” under Article 46-3 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 13194, Dec. 31, 1990) refers to the land, the category of which is the building site registered in the cadastral record, barring any special circumstance.

Article 23 (2) 2 of the Income Tax Act; Article 46-3 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 13194 of Dec. 31, 1990)

[Judgment of the court below]

Head of North Busan District Tax Office

Busan High Court Decision 93Gu7631 delivered on October 5, 1994

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

Article 23(2)2 of the Income Tax Act provides for the special long-term holding deduction in calculating capital gains. Article 46-3 of the Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 13194, Dec. 31, 190) provides that one of the lands excluded from the special long-term holding deduction is “land category under the Cadastral Act without buildings (excluding unauthorized buildings as determined by the Ordinance of the Ministry of Finance and Economy).” Meanwhile, according to the Cadastral Act, “land category” refers to the name by which the kind of land is divided and indicated according to the main purpose of use of the land (Article 2 subparag. 6), and all land shall be categorized as “land category.” Land category shall be registered in the cadastral record. To land category shall be registered on the cadastral record. It shall be determined by the competent authority upon request of landowners or ex officio, and the land category of land shall be determined by the Presidential Decree before and after the main purpose of use of the land (Article 3).

As above, in light of the fact that there is only a land category of “site” under the intellectual law without a separate land category, and that the land category under the intellectual law is determined according to a certain standard and registered in the cadastral record by the competent authority, it is reasonable to set off that “land whose land category under the Cadastral Law is a site” under Article 46-3 of the Enforcement Decree of the Income Tax Act refers to land whose land category registered in the cadastral record is a building site, barring any special circumstance.

The court below acknowledged, based on macroficial evidence, that each land in this case was classified as "the answer" from the time the plaintiff acquired, and actually used as a arable land by neighboring residents, etc. during the time when the plaintiff transferred, but the land category was changed by the transferee after the transfer because other people did not use the land as a arable land and left alone at the time of transfer, and the land category was changed by the transferee. The court below determined that each land in this case cannot be excluded from the special long-term holding deduction because it does not constitute "land category under the Cadastral Law" under Article 46-3 of the Enforcement Decree of the Income Tax Act. Thus, the court below's findings of fact and its determination based on the above opinion are just and acceptable in light of the records, and there is no error of law by misunderstanding facts in violation of the rules of evidence and misunderstanding the legal principles as to Article 46-3 of the Enforcement Decree of the Income Tax Act or misunderstanding the legal principles as to the above legal principles.

Therefore, the appeal is dismissed and all costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Yong-hun (Presiding Justice)