Whether the case constitutes "electric field, paddy field, orchard, stock farm site, and forest land" under Article 84-4 (3) 4 of the former Enforcement Decree of the Local Tax Act concerning the scope of land for non-business use of a corporation shall be determined based on the actual status (affirmative)

Article 77 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 140141, Dec. 31, 1993) provides that acquisition tax shall be imposed on real estate, vehicles, heavy aircraft, or aircraft according to the current state of the relevant goods at the time of actual acquisition, notwithstanding the registration entered in the public register or registered matters. In light of the purport of the above provision, "the field, field, orchard, stock farm site, and forest land" under Article 84-4 (3) 4 of the Enforcement Decree of the same Act shall not be deemed to refer to the category of land on the public register, but the actual land category of which is the dry field, paddy field, orchard, stock farm site

Articles 77 and 84-4 (3) 4 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14041 of Dec. 31, 1993)

Han Industrial Development Co., Ltd. (Attorneys Hy Chang-soo et al., Counsel for the plaintiff-appellant)

The head of Ansan-si (Attorney Jin-hun et al., Counsel for the defendant-appellant)

Seoul High Court Decision 95Gu17931 delivered on May 14, 1996

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal by the Plaintiff’s attorney are examined.

Article 84-4 (1) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14481 of Dec. 31, 1994) which prescribes land for non-business use of a corporation subject to heavy acquisition tax provides that "land for non-business use of a corporation means land which is not directly used for its unique business without any justifiable reason within one year (two years for a factory site determined by the Minister of Home Affairs after consultation with the Minister of Trade, Industry and Energy) from the date of its acquisition, and paragraph (3) of the same Article provides that "land stipulated in the following subparagraphs shall be deemed land for non-business use of a corporation, notwithstanding the provisions of paragraphs (1) and (2): Provided, That the same shall not apply where there is a justifiable reason:

According to the reasoning of the judgment below, the court below determined that the land category of the case No. 1 (the land of this case, including 4 forest land of 211 square meters, etc., 3 forest land of 153 square meters in Hanyang-dong, Seoyang-dong, 153) and the land No. 2 (5,943.8 square meters, among 136-2 forest land of the same 136-2 forest of the same 136-3) acquired by the plaintiff is both forest land. The plaintiff is a corporation with the purpose of manufacturing and processing business of active carbon, manufacturing and processing business of asphalt concrete, manufacturing and processing business of asphalt concrete, and business incidental to aggregate production and related incidental business, not a corporation engaged in agricultural, livestock, or forestry business, and since the land category was not changed within one year from the date of acquisition by the plaintiff, the land of this case is subject to acquisition tax and land subject to non-business regardless of whether it was directly used for the unique business of this corporation under Article 84-4 (3) 4 of the above Enforcement Decree of the

However, Article 77 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14041 of Dec. 31, 1993) provides that acquisition tax shall be imposed on real estate (excluding mining rights and fishing rights), vehicles, heavy aircraft or aircraft according to the current state of the relevant goods at the time of actual acquisition, regardless of the registration entered on the public register or the registered matters. In light of the purport of the above provision, the term "electric field, paddy field, orchard, stock farm site, and forest land" under Article 84-4 (3) 4 of the former Enforcement Decree of the Local Tax Act is not a land category on the public register, but a land category of which is de facto, dry field, orchard, stock farm site, and forest land, regardless of its registered matters

According to the facts acknowledged by the court below, land No. 1 is used as a new site for multi-household house at the time when the plaintiff acquired, and the plaintiff removed the above house under construction after the acquisition and uses the road. Land No. 2 was used as a access road to the factory owned by the plaintiff and a aggregate site after the acquisition, and is used for the same purpose. Therefore, land of the above part of the land of this case cannot be deemed as forest land actually. Furthermore, it is sufficient to view it as land directly used for the plaintiff's unique duties.

Nevertheless, the court below did not see whether the plaintiff used the land of this case as forest land within one year on the basis of the land category in the public record, and determined that the whole land constitutes non-business land of a corporation without considering whether the plaintiff used it directly for its unique business. The court below erred in the misapprehension of legal principles as to non-business land of a corporation. The ground of appeal pointing this out has merit.

Therefore, without examining the remaining grounds of appeal, the judgment below is reversed, and the case is remanded to the court below. It is so decided as per Disposition by the assent of all participating Justices.

Justices Park Jong-ho (Presiding Justice)