Abened Convention Co., Ltd. (Law Firm Nomination, Attorneys Kim Jae-hwan et al., Counsel for the plaintiff-appellant)

The head of Yeongdeungpo-gu Seoul Metropolitan Government

July 7, 2016

1. The plaintiff's claim is dismissed.

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

On May 25, 2016, the Defendant: (a) revoked each disposition of imposition of KRW 84,400,000 for general non-declaration of taxes related to acquisition tax; (b) KRW 253,200 for non-performance of taxes; and (c) KRW 25,320 for non-performance of taxes related to local education tax; and (d) KRW 12,660 for non-payment of taxes related to special rural development tax (the Plaintiff stated in the complaint that he/she seeks revocation of each disposition of imposition of KRW 84,653,20 for non-payment of taxes; (b) KRW 25,320 for local education tax; and (c) KRW 12,660 for special rural development tax; (c) however, the purport of the purport of

1. Details of the disposition;

A. On June 3, 2015, the Plaintiff purchased a total of 25,404 square meters of land and 9,27.72 square meters of land on 16 lots, other than 743 square meters in Seo-gu, Chungcheongnam-gu, Chungcheongnam-gu, Chungcheongnam-gu, and submitted an application for ownership transfer registration of the instant real estate to the Cheongju District Court on or around June 3, 2015 through a certified judicial scrivener. On June 4, 2015, the following day, the Plaintiff reported and paid acquisition tax of 884,00,000, local education tax of 84,400,000, local education tax of 84,40,000, and special rural development tax of 42,200,000 won.

B. On July 1, 2015, the Defendant confirmed that the acquisition tax related to the instant real estate had been paid on the day following the receipt date of the application for the registration of transfer of ownership. On July 1, 2015, the Defendant imposed the Plaintiff KRW 84,400,000 as general non-declaration penalty tax on acquisition tax and KRW 253,200 as additional tax on non-payment, additional tax on non-payment of local education tax, KRW 25,320 as additional tax on non-payment of local education tax, and KRW 12,660 as additional tax

C. Accordingly, on May 25, 2016, the Defendant revoked the above disposition of imposition ex officio during the proceeding of the instant lawsuit, and made a disposition of imposition of KRW 84,400,000 for general non-returning additional tax on acquisition tax and additional tax for unfaithful payment, KRW 253,200 for additional tax on acquisition tax, KRW 25,320 for unfaithful payment on local education tax, and KRW 12,660 for additional tax on rural development tax (hereinafter “instant disposition”).

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, Eul evidence 1 to 8, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) Article 20(4) of the former Local Tax Act (amended by Act No. 13636, Dec. 29, 2015; hereinafter the same) only provides that the obligation to pay and pay acquisition tax on property rights subject to registration shall be registered before the registration is made. Article 35(4) of the Enforcement Decree of the Local Tax Act (hereinafter “Enforcement Decree of the instant case”) limits the time limit to the date of receipt of an application for registration without any delegation by limiting it to the date of receipt of an application for registration. Accordingly, the Enforcement Decree of the instant case is unlawful, and thus, the instant disposition based thereon shall also be revoked in an unlawful manner.

2) In light of the fact that an application for registration of the instant real estate was filed after the retirement of a public official in charge of registration at the Cheongju District Court, it was impossible for the Plaintiff to report and pay the acquisition tax on the day. Moreover, the Plaintiff paid the acquisition tax on the following day immediately. Considering such circumstances, the instant disposition is unlawful as it was excessively harsh to the Plaintiff.

B. Relevant statutes

▣ 구 지방세법

Article 20 (Return and Payment)

(4) Where a person intends to register or register (including registration; hereinafter the same shall apply) matters concerning the acquisition or transfer of property rights and other rights in the public register, he/she shall file a return on and pay acquisition tax before such registration or record is made.

▣ 지방세법 시행령

Article 35 (Deadline for Payment of Acquisition Tax at Time of Registration or Record)

Until a registration or record is made under Article 20 (4) of the Act, an application for registration or record shall be filed by the date on which an application for registration or record is received by the registry office.

C. Determination

1) Whether the provisions of the Enforcement Decree of this case are unlawful

The Enforcement Decree or the Enforcement Rule of the Act cannot change or supplement the contents of rights and obligations of an individual or provide new contents that are not prescribed by the Act, unless otherwise delegated by the Act. However, the Enforcement Decree or the Enforcement Rule of the Act is merely a clear and systematic examination of the legislative purport of the parent law and the entire provisions related thereto, which are possible in the interpretation of the parent law, and if it is intended to embody them based on the purport of the provisions of the parent law, it shall not be deemed to go beyond the scope of the parent law. Thus, even if the parent law does not directly delegate such provisions, it shall not be deemed null and void (see Supreme Court Decision 2008Du13637, Jun. 11, 2009).

With respect to the instant case, Article 20(4) of the former Local Tax Act provides that acquisition tax shall be reported and paid before the registration or enrollment is made in the public register of matters concerning the acquisition or transfer of property rights and other rights. The pertinent provision provides that acquisition tax shall be reported and paid before the registration or enrollment is made to the person who intends to register the acquisition of property rights. The instant provision provides that an application for registration or enrollment shall be the date of receipt by the registration or enrollment office until the registration or enrollment is made under Article 20(4) of the former Local Tax Act. The relevant provision of the Enforcement Decree of the instant case provides that an application for registration or enrollment shall be the date of receipt by the registration or enrollment office. Although the mother law did not directly provide for the provision on delegation, it shall be deemed valid only because it has been embodied based on the purport of the provisions of the former Local Tax Act within the scope of the regulation of the mother law. Therefore, this part of the Plaintiff’s assertion is without merit.

2) Existence of justifiable grounds and deviation and abuse of discretionary power

Under the tax law, when a taxpayer violates various obligations, such as a return and tax payment, without justifiable grounds, in order to facilitate the exercise of the right to impose taxes and the realization of a tax claim, the taxpayer's intention and negligence are not considered as administrative sanctions imposed as prescribed by the individual tax law. However, if the taxpayer is not negligent in performing his/her duties, and there is a justifiable reason not to impose taxes.

However, the Plaintiff received an application for registration of transfer of ownership to the instant real estate on June 3, 2015, and filed and paid acquisition tax on June 4, 2015, which is the next day. As such, the Plaintiff neglected its duty to report and pay acquisition tax under Article 20(4) of the former Local Tax Act. The Plaintiff did not err in the Plaintiff’s negligence of neglecting its duty to report and pay acquisition tax on the sole basis of the circumstances alleged by the Plaintiff, or did not appear to have violated the disposition of this case imposing penalty tax calculated as prescribed by the Local Tax Act and subordinate statutes, or deviates from or abused its discretionary power, and there is no other evidence to acknowledge this otherwise. Accordingly, the Plaintiff’s assertion on this

3. Conclusion

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

Judges Yang Sung-Gyeong (Presiding Judge)