Chuncheon District Court 2008Guhap1076 ( October 28, 2010)

Early High Court Decision 2007J 4901 (Law No. 25, 2008)

The transaction value of the unlisted stocks transferred with management rights can not be considered as the market price.

In the case of stock transfer, if the right of management is transferred together, the transaction price shall not be deemed the market price that reflects the objective exchange value when only the stocks are transferred.

The contents of the decision shall be the same as attached.

1. Of the judgment of the first instance court, the part against the defendant in excess of the subsequent order for cancellation shall be revoked, and the plaintiff's claim corresponding to the cancellation shall be dismissed

The Defendant’s disposition of imposition of gift tax of KRW 947,158,210 against the Plaintiff on August 8, 2007 that exceeds KRW 815,817,267 shall be revoked.

2. The defendant's remaining appeal is dismissed.

3. The total costs of the litigation shall be five minutes, and four minutes shall be borne by the Plaintiff, and the remainder by the Defendant, respectively.

1. Purport of claim

The Defendant’s disposition of imposition of gift tax of KRW 947,158,210 against the Plaintiff on August 8, 2007 is revoked.

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. The reasoning for the court's explanation concerning this case is as follows, except for the part of "the determination on whether the stock price is calculated or not" as to the Chapter 4 of "2. D. (4) of the reasoning of the judgment of the court of first instance (the calculation of the stock price)" is identical to the reasoning of the judgment of the court of first instance (excluding the part of the conclusion). Thus, it is cited as it is in accordance with Article 8(2) of the Administrative Litigation Act and the main sentence

‘2.(d)(4) Determinations as to whether or not to misleads the stock price.’

(A) In cases where shares issued by a company are transferred with the right of management, the transaction price cannot be deemed as the general market price reflecting the objective exchange value in cases where only shares are transferred, and the market price cannot be deemed as the market price in cases where shares are transferred with the right of management. The purport of the purport is that the transfer of shares accompanied by the right of management may have a relatively high price formation compared to cases where shares are transferred with the right of management, and that the transfer price cannot be deemed as the general market price of the shares (see Supreme Court Decision 2005Du12022, Sept. 21, 2007).

(B) According to the evidence adopted earlier and Eul evidence No. 17, the fact that the largestA acquired all 62,787 billion won of the shares issued in the name of insurance from ParkB, etc. (7.2 billion won + KRW 138,563 won per share of the net asset value of the company + KRW 1.5.63 billion) (Article 4 of the share transfer contract of October 27, 2003). In light of the fact that 8.7 billion of the share transfer price paid by the largestA includes the price for the acquisition of the right of insurance in the name of insurance, the total amount of 8.7 billion won, which is the transfer price, can not be deemed as the market price as the objective exchange price for the shares issued in the name of insurance. Thus, since it is not clear that the parties to the contract have the net asset value of 7.2 billion won in the name of insurance at the time, it is difficult to view the transaction price of the shares as the market price of 6.0 billion in the name of insurance.

(C) Therefore, the disposition of this case, which calculated the gift value by evaluating the acquisition price of the shares of the largestA at the market price of the shares of this case, shall be deemed unlawful. However, in case where the gift tax is a non-listed stock, there is no sale example reflecting the objective exchange value at an appropriate level or it is difficult to calculate the market price by any other method, the value of shares shall be assessed according to the method of appraisal of securities as stipulated in Article 54 of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act (amended by Presidential Decree No. 18177 of Dec. 30, 2003) by supplementary method, and the amount of a political party tax calculated by supplementary method, such as the certificate No. 15, No. 19, No. 17,267, as stated in the certificate No. 815,817,267

2. If so, the part of the disposition of this case, which exceeds the fair and reasonable amount of KRW 815,817,267, which is a legitimate tax amount, shall be revoked. Thus, the plaintiff's claim of this case shall be accepted within the scope of the above recognition, and the remaining claims shall be dismissed as there is no reason. Since the judgment of the court of first instance is partially unfair, it shall be accepted by the defendant's appeal, and the part of the judgment of the court of first instance against the defendant in excess of the above order of revocation shall be revoked, and the plaintiff's claim corresponding to the revoked part shall be dismissed, and