Seocho-2017- Busan District Court-2622 (2017.08.08)

Since most of the facts are located within the control area of the taxpayer, the necessity of proof is recognized when proving the taxpayer is reasonable.

Where it is impossible to recognize or confirm the actual transaction price at the time of acquisition, if there is no transaction example or appraisal price within three months before and after the date of acquisition, the conversion price shall be deemed the acquisition price.

Article 94 of the Income Tax Act: Scope of Transfer Income

2017Guhap743 Revocation of Disposition of Imposing capital gains tax

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○ Head of tax office

2018.03.08

2018.04.05

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

The disposition of imposition of capital gains tax of KRW 84,872,222 against the plaintiff on February 1, 2017 by the former defendant of the Gu office shall be revoked.

1. Circumstances of dispositions;

A. On February 2, 1998, the Plaintiff purchased 69,121 square meters of ○○○○○○○-gun, ○○○○○-gun, ○○○○○-gun, ○○○○○-si, and completed the registration of ownership transfer on the 21st of the same month.

B. After that, the instant land was divided into 41,194 square meters of ○○-○○-○ Forest as indicated below, 00 square meters of 5,407 square meters of ri, 00-○-○ Forest, 8,204 square meters of 0,000 forest, 13,460 square meters of 13,460 square meters of 0,000-○-○-○-○-○-○-○-gun-gun as indicated in the following table (hereinafter referred to as the “instant land”), and the Plaintiff sold the said land to Nonparty KimA for the said ○○○-○-○-○-○-○-○-si 856 square meters on May 23, 2016, and the remainder of the said land was completed on June 1, 2016, respectively.

C. On August 10, 2016, the Plaintiff filed a return on the tax base and tax amount of capital gains tax with the transfer value of the instant land KRW 490 million and the acquisition value of KRW 420 million.

D. Accordingly, as a result of the investigation into capital gains tax on the Plaintiff from October 17, 2016 to October 25, 2016, the Defendant: (a) failed to submit objective evidentiary data, such as the original copy of the sales contract and the details of financial transactions on the payment of the price, in addition to the copy of the sales contract, submitted by the Plaintiff at the time of filing a report on capital gains tax; (b) deemed that the acquisition value of the instant land was unclear; and (c) determined the acquisition value of the instant land as KRW 170,125,249 [the converted value = transfer value 】 (the officially announced value at the time of acquisition / the officially announced value at the time of transfer / the officially announced value at the time of transfer)]; and (d) based on such determination, on February 1, 2017, the Defendant issued a correction and notification of KRW 84,872,222, the capital gains tax reverted to the Plaintiff in February 1, 2016 (hereinafter “instant disposition”).

E. On May 8, 2017, the Plaintiff filed an adjudication seeking revocation of the instant disposition with the Tax Tribunal, but the Tax Tribunal dismissed the said adjudication on August 8, 2017. Each entry in Gap’s 1 through 4, 6, 9, and Eul’s 1 through 5 (including the Serial number if there is a tentative number) and the purport of the entire pleadings.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The Defendant determined that the acquisition value of the instant land was unclear, and then disposed of the instant land by deeming the amount converted on the basis of the officially announced value of the instant land as the acquisition value, but the Plaintiff acquired the instant land in the actual amount of KRW 420 million, and thus, the instant disposition was unlawful on a different premise.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) The tax authority shall bear the burden of proving the tax base, which serves as the basis of taxation in a lawsuit seeking revocation of taxation, and the tax base shall be the tax authority as a matter of principle, since the revenue and necessary expenses are deducted from necessary expenses. However, since most of the factual relations producing necessary expenses are in the sphere under the control of the taxpayer, and it is difficult for the tax authority to prove it. Thus, if it is reasonable to prove the taxpayer in consideration of difficulty in proof or equity between the parties, it is reasonable to recognize the necessity of proof to the taxpayer (see, e.g., Supreme Court Decisions 2002Du1588, Sept. 23, 2004; 2006Du16137, Oct. 26, 2007; 2006Du16137, Oct. 26, 2007; 300,000 won of the land of this case, it is reasonable to acknowledge the Plaintiff’s assertion that the Plaintiff acquired the land of this case as evidence within 4 billion won before and after the date of acquisition.

① The Plaintiff only submitted a copy of the sales contract with respect to the instant land, and the original document to verify the authenticity thereof is deemed to have been lost. However, if the original document is lost and copied, it is expected that the document would be acceptable for such reasons. Ultimately, there is no limit to sufficiently trust the copy.

② The Plaintiff asserted that, at the time of purchase of the instant land from the deceased Kim Jong-ri, KRW 50 million was the money withdrawn from the Plaintiff’s deposit passbook, etc.; KRW 250 million, out of the remainder of KRW 370 million, the remainder of KRW 250 million was the money borrowed from the outer ginseng village and the Yong-Nam; the remainder of KRW 120 million was paid with the money that extracted and disposed of the pine trees that were born on the instant land on November 7, 1998; however, the Plaintiff failed to submit financial data consistent with such assertion. Moreover, the receipt of the remaining money was ordinarily made simultaneously with the registration of ownership transfer; however, the seller, Kim Jong-ri et al. received a large balance of KRW 120 million, which is much more than that of the Plaintiff on February 21, 1998.

③ Considering the fact that the Plaintiff’s KRW 420 million as the acquisition value of the instant land is the amount equal to 30 times the standard market price at the time of acquisition of the instant land, which is the amount equal to 13,824,200 won (land price at the time of acquisition x area) and that the seller’s net Kim Jong-tae reported the sale price as KRW 70 million when reporting the transfer income tax after selling and selling the instant land, it is difficult to believe that the Plaintiff purchased the instant land at KRW 420,000,000 on the grounds of tax, etc. at the time of selling and selling the instant land.

④ Although the △△△△ was the son of the seller’s deceased Kim, it is difficult to view that the acquisition value of the instant land was accurately known as long as the instant land was not a party to the sales contract, even if it was based on the statement in this court of △△△, at the time of selling and buying the instant land.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.