[1] In the case of exchange, whether it can be viewed that the actual transfer value of the pertinent asset, which is the basis for calculating the amount of transfer income tax, can be confirmed (negative with qualification)

[2] Whether the imposition of capital gains tax based on the actual transaction price is in violation of the substance over form principle or the principle of gold speech by imposing capital gains tax based on the standard market price after the cancellation by the court (negative)

[1] The actual transfer value of the pertinent asset, which serves as the basis for calculating the transfer income tax, refers to the value that the transferor transfers the asset at the time of the transaction and received as the price for the transfer and that is objectively perceived by the sales contract and other documentary evidence. Therefore, in case of the exchange of the asset, it shall be deemed that the actual transfer value may be confirmed if it is accompanied by the settlement procedure for the difference in the appraisal value by appraising the market value of the object of exchange as a value exchange based on the basis of the monetary value of the object of exchange. However, in case of a simple exchange of the object

[2] According to Article 127 of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994), if an omission or error is found even after the tax base and tax amount are determined, the government shall immediately investigate, determine or correct the tax base and tax amount. Thus, the imposition of capital gains tax based on the standard market price does not conflict with the principle of substantial taxation or the principle of no taxation.

[1] Article 23 (4) 1 (see current Article 96 subparagraph 1) and Article 45 (1) 1 (see current Article 97 (1) 1) of the former Income Tax Act (amended by Act No. 4661 of Dec. 31, 1993) / [2] Article 127 (see current Article 14 (2)) of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994)

[1] Supreme Court Decision 92Nu14472 delivered on February 12, 1993 (Gong1993Sang, 1024), Supreme Court Decision 94Nu6840 delivered on December 9, 1994 (Gong1995Sang, 520), Supreme Court Decision 96Nu860 delivered on February 11, 1997 (Gong1997Sang, 805) / [2] Supreme Court Decision 90Nu9278 delivered on June 11, 1991 (Gong191, 1947)

Plaintiff (Attorney Kim Jin-jin, Counsel for the plaintiff-appellant)

The director of the Incheon Metropolitan City tax office

Seoul High Court Decision 97Gu52686 delivered on November 19, 1998

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

We examine the grounds of appeal.

1. As to the assertion of misapprehension of legal principles as to the calculation of capital gains tax amount

The actual transfer value of the relevant asset, which serves as the basis for calculating the amount of capital gains tax, refers to the value that the transferor transfers the asset at the time of the transaction and received as the price for the transfer and is objectively recognized by the sales contract or other documentary evidence. Thus, in case of the exchange of the transaction, it is a value exchange based on the value of the object, especially on the basis of the value of the object, and it is accompanied by the procedure for settlement of the difference in the value of the object to be exchanged. However, in case of a simple exchange of the value, the actual transfer value may be confirmed, but in case of a simple exchange, the actual transfer value shall not be confirmed (see, e.g., Supreme Court Decisions 94Nu6840, Dec. 9, 1994; 96Nu860, Feb. 11,

According to the facts established by the court below, the plaintiff and the non-party exchange five households with the land of this case and the non-party newly built by the non-party. The value of the land of this case shall be KRW 250 million, and the value of five households with multi-household houses shall be KRW 265 million,00,000,000,000 as supplementary money, and the plaintiff paid the difference as KRW 10.5 million to the non-party, and there is no evidence showing that the market value was appraised while evaluating the value of the land of this case or multi-household houses on the record. Thus, the transfer of the land of this case shall be deemed to fall under the case where the actual transfer value

Therefore, on the premise that the actual transfer value of the land of this case can be grasped, the court below should calculate the transfer margin of the land of this case based on the actual transaction value, or even if the transfer margin is calculated based on the standard market price as in the disposition of this case, it is not appropriate to determine the part exceeding the scope of the transfer margin based on the actual transaction value among the tax amount calculated based on the standard market price, as in the disposition of this case. However, the conclusion that the court below rejected such assertion is just, and it is not erroneous in the misapprehension of the legal principle as otherwise alleged in the ground of appeal. The grounds of appeal on

2. As to the allegation of omission of judgment

According to the records, the defendant deemed that the transfer of the land in this case originally constituted the transfer of unregistered assets, and although the court imposed transfer income tax based on the actual transaction value, it can be known that the disposition of taxation was revoked on the ground that the transfer income tax was not the transfer of unregistered assets. On this basis, the plaintiff at the court below held that since the defendant imposed transfer income tax based on the actual transaction value, it is against the principle of substance over form or the principle of gold, and it is against the purport of Article 166 (4) 3 of the Enforcement Decree of the Income Tax Act amended by Presidential Decree No. 14860 on December 30, 195, but the court below did not make an explicit decision on this point.

However, pursuant to Article 127 of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994), if any omission or error is found even after the determination of the tax base and tax amount, the government shall immediately investigate, determine or correct the tax base and tax amount. Furthermore, the instant disposition imposing capital gains tax on the standard market price on the ground that the initial imposition disposition based on the actual transaction price is revoked by the court and does not fall under the requirements for application differently, and it cannot be said that there is any error as alleged by the plaintiff. Thus, it is obvious that the Plaintiff’s assertion cannot be accepted, and therefore, the court below’s error of omitting its determination has no influence on the conclusion of the judgment. The grounds for appeal on this point are not acceptable.

3. Therefore, the appeal is dismissed, and all 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 Lee In-hee (Presiding Justice)