In accordance with the main sentence of Article 15(3) of the former Enforcement Decree of the Income Tax Act, the burden of proving that the entire house is exempt from taxation (=taxpayer) and the burden of proving that the other purpose buildings are excluded from non-taxation pursuant to the proviso of Article 15(3) of the Enforcement Decree of the same Act

Article 5 subparagraph 6 (i) of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994) provides that "one house for one household as prescribed by the Presidential Decree and the appurtenant land shall not be exempted from income tax on the income accruing from a transfer of the land within the area calculated by multiplying the area on which the building is built by the ratio as determined by the Presidential Decree by the area by the area." Article 15 (3) of the former Enforcement Decree of the Income Tax Act (amended by the Presidential Decree No. 14467 of Dec. 31, 1994) provides that "where there are other buildings, such as stores, etc., or the buildings are constructed on the same lot number, the entire buildings shall not be deemed housing if the area of the house is smaller than or equal to the area of the house other than the house, the buildings other than the house shall not be deemed housing, and the taxpayer shall have the burden of proving that the whole house is exempt from taxation under the main sentence of Article 15 (3) of the Enforcement Decree of the same Act, or the burden of proof shall be excluded.

Article 5 subparagraph 6 (i) (see current Article 89 subparagraph 3) of the former Income Tax Act (amended by Act No. 4803, Dec. 22, 1994); Article 15 (3) of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 14467, Dec. 31, 1994) (see current Article 154 (3))

Plaintiff (Attorney Han-chul et al., Counsel for the plaintiff-appellant)

The director of Gwangju Tax Office

Gwangju High Court Decision 97Gu4721 delivered on September 4, 1998

The appeal is dismissed. The costs of appeal are assessed against the plaintiff.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

Article 5 subparagraph 6 (i) of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994; hereinafter referred to as the "Act") provides that "one house for one household as prescribed by the Presidential Decree and the appurtenant land shall not be subject to income tax on the income accruing from a transfer of the land within the area calculated by multiplying the area on which the building is built by the ratio as determined by the Presidential Decree by region by the ratio as determined by the Presidential Decree." Article 15 (3) of the former Enforcement Decree of the Income Tax Act (amended by the Presidential Decree No. 14467 of Dec. 31, 1994; hereinafter referred to as the "Enforcement Decree") provides that "where there is a building for other purpose, such as a store, etc., or a building for other purpose is constructed on the same lot number, the building other than the house shall not be deemed a house if the area of the house is smaller than or equal to the area other than the house, and that the tax authority bears the burden of proof under the proviso of non-taxation.

According to the reasoning of the judgment below, the court below held that the first and second floors among the houses of this case were used as a house at the time of transfer of this case, and that the disposition of this case by the defendant, which did not comply with the disposition of this case, was unlawful despite the fact that the part of the building of this case is included in the area of the house under Article 15 (3) of the Enforcement Decree, shall be calculated. The judgment below erred by misapprehending the legal principles on the burden of proof for non-taxation requirement under the proviso of Article 15 (3) of the Enforcement Decree, on the ground that the plaintiff is responsible for proving that the part of the building of this case is a house, and that the above first and second floors are used as a house, and there is no other evidence to acknowledge it, and thus, the disposition of this case, which calculated capital gains tax by deeming the first and second floors as the "building for other purposes" under Article 15 (3) of the Enforcement Decree, was legitimate.

However, even according to the plaintiff's assertion, the heating facilities had been installed as a stone to the first and second floor of the house of this case, and the wall was built as cement brick, but it was removed from the wall installed as a stone and cement brick, and the partitions and floor was installed as a mix. According to the records, the non-party, who is the purchaser of the house of this case, did not own a gradium or boiler facilities on the first and second floor at the time of acquiring the house of this case, and had no gradium or boiler facilities on the floor, and there was a camping gradsium and electric board on the floor. The plaintiff's resident registration until the time of transfer of the house of this case, it remains in the Dong-gu, Gwangju, ○○○○○○○ apartment (Dong, lake 1 omitted) (the plaintiff's residential building of this case, the plaintiff's present residential building of this case, and the part of this case's imposition of transfer income tax on the 1st floor and the 2nd floor of this case is legitimate.

Therefore, the appeal is dismissed and the 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 Kim Jong-sik (Presiding Justice)