Whether the Korea Teachers' Mutual Aid Association constitutes a non-profit corporation under Article 84-4 (4) 1 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 1303 of Jun. 29, 190) (affirmative)

In full view of the provisions of the Korea Teachers’ Mutual Aid Association Act and the articles of incorporation of the same Mutual Aid Association, it is reasonable to view the Korea Teachers’ Mutual Aid Association as a non-profit corporation. Therefore, insofar as the Korea Teachers’ Mutual Aid Association provided for profit-making business such as lease within one year after it acquired land for profit-making business, it shall not be deemed land for non-business use of a corporation pursuant to Article 84-4 (4) 1 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 13033 of Jun. 29,

Article 84-4 (4) 1 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 1303 of Jun. 29, 190)

[Plaintiff-Appellant-Appellee] Plaintiff 1 and 1 other (Law Firm Gyeong, Attorneys Park Jae-soo et al., Counsel for plaintiff-appellant-appellant-appellee)

Korea Teachers' Mutual Aid Association (Law Office, Attorney Lee Young-chul, Counsel for defendant-appellee)

Attorney Cheong-ju City Mayor, Counsel for the plaintiff-appellant

Seoul High Court Decision 91Gu22645 delivered on July 22, 1992

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

According to Article 84-4 (4) of the Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 1303 of Jun. 29, 190), land falling under any of the following subparagraphs shall not be deemed land for non-business use of a corporation, notwithstanding the provisions of paragraphs (1) through (3). The subparagraph 1 provides that "the land acquired by a non-profit corporation to run a profit-making business for the purpose of creating expenses necessary for the performance of its own business without any justifiable reasons: Provided, That this shall not apply where a profit-making business is not commenced within one year after the acquisition and where the profit-making business is used for a purpose that is not related to the performance of its unique business, if a non-profit corporation acquired the land for profit-making business and starts a profit-making business within one year

Meanwhile, under the same Act as a special juristic person established under the Korea Teachers' Mutual Aid Association Act, the Mutual Aid Association is a juristic person established to efficiently establish the mutual aid system for members, such as public educational officials (Article 1 of the Act); the Mutual Aid Association is obligated to pay contributions as prescribed by the articles of association; the Mutual Aid Association is entitled to receive benefits and other benefits or services from the Mutual Aid Association (Article 7 (2) of the Act); the Mutual Aid Association operates its payment business for members, various welfare for members, operation of welfare facilities and fund raising funds as prescribed by the articles of association (Article 11 of the Act); the capital of the Mutual Aid Association is the shares of members and government subsidies (Article 12 of the Act); the literature Delivery Mutual Aid Association is required to provide assistance to the members for business deficit based on the contributions of its members (Article 13 of the Act); the formulation of its budget; the provisions of Article 21 (2) of the Act shall be applied mutatis mutandis to the settlement of accounts with the approval of the Minister for Delivery of Real Estate; the provisions of the Articles of Association of the Mutual Aid Association concerning the settlement of Accounts.

In full view of the above provisions regarding the purpose of establishment, operation form, distribution of profits, and distribution of residual assets of the Plaintiff Mutual-Aid Association, it is reasonable to view the Plaintiff Mutual-Aid Association as a non-profit corporation. As long as the Plaintiff Mutual-Aid Association acquired land for profit-making business and provided it for profit-making business within one year after its acquisition, it shall not be deemed land for non-business use of

According to the reasoning of the judgment below, the court below recognized the fact that the plaintiff acquired the land and buildings of this case from January 1, 1989 to start rental business, and held that the land of this case is a non-profit corporation and thus it is not a land for non-business use of a corporation subject to acquisition tax. The judgment of the court below is justified and it is not erroneous in the misapprehension of legal principles as to the land of this case. It is without merit.

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

Justices Choi Jae-ho (Presiding Justice)