Suwon District Court 2010Guhap2259 ( October 14, 2010)

early 209 middle 1697 ( November 18, 2009)

The application of heavy tax rates is legitimate because the multi-family house does not constitute a small house or national housing.

The multi-family house in this case is a small house with the standard market price exceeding 40 million won at the time of transfer, and the area is not more than a certain size and not more than three houses for one household, and the application of heavy tax rates is lawful because it does not constitute national housing.

2010Nu37638 Revocation of Disposition of Imposing capital gains tax, etc.

XX Kim

O Head of tax office

Suwon District Court Decision 2010Guhap2259 Decided October 14, 2010

July 21, 201

August 25, 2011

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked. Each disposition of KRW 14,605,618 and the transfer income tax reverted to the Plaintiff on October 1, 2008 on January 10, 2009, which the Defendant rendered on October 1, 2007, shall be revoked. Each disposition of KRW 39,462,700, which reverts to the Plaintiff on January 10, 2009. The Defendant shall pay KRW 4,723,600 to the Plaintiff.

1. Circumstances of dispositions;

A. The plaintiff newly built a multi-family house located in XX-dong 000-0 (hereinafter referred to as the "first house of this case") and a multi-family house located in 000-0 (hereinafter referred to as the "second house of this case") and obtained approval for use on October 5, 199.

B. Thereafter, on September 28, 2007, the Plaintiff transferred the instant housing No. 1 in KRW 500,000,000, and November 20, 2007, respectively, the instant housing No. 2 in KRW 487,00,000, and on November 30, 2007, the acquisition value of the instant housing No. 1 in November 30, 2007 was KRW 195,709,800, and on January 31, 2008, the Plaintiff filed a tax base return on each transfer income tax with the acquisition value of KRW 216,064,70 for the instant housing transfer, and voluntarily paid transfer income tax of KRW 5,695,740 for the instant housing transfer (for the instant housing No. 2, it was reported that there was no transfer income tax).

C. On October 1, 2008, the Defendant issued a disposition to impose capital gains tax of KRW 14,605,618 on the Plaintiff on October 1, 2007, by applying conversion acquisition value of KRW 141,009,590 on the ground that the acquisition value of the instant first house reported by the Plaintiff is unclear as there is no evidence related to the new construction of the relevant house.

D. In addition, the Defendant applied the conversion acquisition value of KRW 154,875,98 on the ground that the acquisition value of the second house reported by the Plaintiff is unclear due to lack of evidence related to the construction of the said house. At the time of the transfer of the second house of this case, the Plaintiff owned 4 households in XX-Gu and multi-household houses located outside 00-0, and the transfer of the second house of this case was deemed to have been a transfer of the house corresponding to 3 or more houses for one household, and accordingly, issued the instant disposition on January 10, 200 by applying the heavy tax rate of 60% to the Plaintiff on January 10, 209 by applying the heavy tax rate of 39,462,70 won.

E. On March 24, 2009, the Plaintiff filed an appeal with the Tax Tribunal, but was dismissed on November 18, 2009.

[Reasons for Recognition] Facts without dispute, Gap evidence 1, 2, Gap evidence 3, Gap evidence 5, and Eul evidence 1, 2, Eul evidence 1-1, 2, Eul evidence 2-2, Eul evidence 3-1, 3-2, Eul evidence 4, and the purport of the whole pleadings

2. Relevant statutes;

It is as shown in the attached Form.

3. Ex officio determination

A. On October 1, 2008, the part of the claim for revocation of the disposition of capital gains tax on the first house of this case is examined ex officio. According to Articles 5(1), 56(2) and (4), and 68(1) of the former Framework Act on National Taxes (amended by Act No. 9911, Jan. 1, 2010; hereinafter the same), an administrative litigation on a disposition under tax-related Acts cannot be filed within 90 days from the date the pertinent disposition is known (the date when a notice of disposition is received) and the decision is not necessary. If the request for examination or adjudgment, which is the necessary pre-trial procedure of an appeal seeking revocation of the administrative disposition, is illegal due to the lapse of the time limit, the administrative litigation cannot be dismissed. This point is not so decided as unlawful because it fails to satisfy the requirements of pre-trial, and even if the administrative agency rendered a request for examination or adjudgment with respect to a lawful trial, it is not so decided as unlawful even if it is decided as unlawful (see, e.g., Supreme Court Decision 900Do16.

However, in full view of the purport of the arguments in the above evidence, the defendant issued a disposition imposing capital gains tax on the first house of this case on October 1, 2008, and the plaintiff paid KRW 14,605,610 (the defendant's assessed tax amount is KRW 14,605,618 or the notified tax amount to the plaintiff is KRW 14,605,610) on the 30th of the same month. It is reasonable to view that the plaintiff was notified of the disposition imposing capital gains tax on the first house of this case at least on October 30, 208. Even if the plaintiff filed a request with the Tax Tribunal for a trial on the above disposition of imposition of capital gains tax on March 24, 2009, this part of the plaintiff's request for a trial on the above disposition of capital gains tax on the 90th of the same month is unlawful due to the lapse of the necessary period, and thus, the plaintiff's lawsuit on this part is unlawful even if the plaintiff's request for a tax Tribunal's determination is unlawful.

B. The part demanding payment of money

The provision of Article 51 (1) of the Framework Act on National Taxes concerning the refund of a national tax is just a declaration of the legal principle that the immediate return of unjust enrichment, the existence and scope of which have already been determined as unjust enrichment, is reasonable in the justice and fairness in the case of erroneous payment or refund of a tax, and the amount of erroneous payment or refund, the existence and scope of which have been determined as such, may be claimed by a taxpayer as a civil lawsuit seeking the return of unjust enrichment (see Supreme Court Decision 97Da26432, Oct. 10, 1997). Thus, even though the Plaintiff may file a lawsuit seeking refund against the Defendant, the claim for refund should be filed against the Republic of Korea, the subject of the excessive payment of capital gains tax, and the Defendant, the administrative agency which is only the administrative agency, is not qualified as the Defendant. Thus, the Plaintiff’s claim for refund of a refund of this case is unlawful.

4. Whether the instant disposition is lawful

A. The plaintiff's assertion

(1) Regarding the application of small houses

According to Article 167-3(2)1 and 19 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 20720, Feb. 29, 2008; hereinafter the same shall apply) and Article 82 of the former Enforcement Rule of the Income Tax Act (amended by Ordinance of the Ministry of Strategy and Finance No. 15, Apr. 29, 2008; hereinafter the same shall apply), in calculating the number of houses to apply the heavy taxation rate of three houses for one household, in cases of multi-family houses, it is required to determine whether they are detached houses at the taxpayer’s option. This case’s second house is not a detached house, but a multi-family house consisting of a small house with a total floor area of not more than 60§³ of each house, and thus, it is not included in the scope of houses falling under three houses or more for one household, and thus, general tax

(2) Regarding the application of the Restriction of Special Taxation Act

The second house of this case constitutes a national housing subject to reduction or exemption of capital gains tax under Article 99 of the former Restriction of Special Taxation Act (amended by Act No. 6762 of Dec. 11, 2002; hereinafter the same shall apply), and is not included in the scope of housing falling under three or more houses for one household pursuant to Article 167-3 subparagraph 5 of the Enforcement Decree of the Income Tax Act, and thus, general tax rates shall apply.

B. Determination

(A) As to paragraph (1) above

In full view of the provisions of Article 104 (1) 2-3 of the former Income Tax Act (amended by Act No. 8825 of Dec. 31, 2007), Articles 155 (15), and 167-3 (1) 9, and (2) 1 of the former Enforcement Decree of the Income Tax Act, and Articles 74 and 82 (1) and (3) of the former Enforcement Rule of the Income Tax Act, in cases of transfer of multi-family houses after February 28, 2007, the scope of houses falling under three or more houses for one household to which 60% heavy tax rate applies shall be determined on or before December 31, 200, in cases of transfer of multi-family houses, the portion partitioned to be seen as one house at the resident’s option or to be residing independently by one household shall be deemed as one house, and in cases of a small house with a size of 120 square meters or more, it shall be deemed as one house for not more than 300 million won as one house at the time of transfer.

(B) According to the above evidence and Gap evidence Nos. 2-1 and 2-2, the plaintiff was found to have obtained approval for use of the second house which is a multi-family house on October 5, 199. However, the plaintiff transferred the second house of this case on November 30, 2007 to a single sales unit. The land area of the second house of this case is 169.7m2 and the total area of the second house is 38.74m2 (limited to the total area used for residence). The plaintiff's assertion that the acquisition date of the second house of this case is x 00-0,000 and 4 multi-household houses located in x 2,000,000 and 93.6m2, each house of this case is 4,000,000,000 won at the time of transfer, and the plaintiff's assertion that the second house of this case was not included in the above 3-household house of this case.

(2) As to the above Sub-paragraph (2)

(A) Comprehensively taking into account the contents of Article 1 and Article 29(1) of the Addenda of the Restriction of Special Taxation Act (Act No. 6762 of Dec. 11, 2002), Article 99(1)1 of the former Restriction of Special Taxation Act (amended by Act No. 6762 of Dec. 11, 2002), Article 89(1)3 of the former Income Tax Act (amended by Act No. 6781 of Dec. 18, 2002), Article 156(2) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 17825 of Dec. 30, 2002), the amount of tax equivalent to the transfer income tax generated from the date of acquisition of the relevant house for the period from May 22, 199 to June 30, 199 (in cases of national housing, from the date of acquisition to the date of acquisition, to the date of transfer approval or transfer of the relevant house within 15 years after the acquisition date.

(B) In this case, as seen earlier, the Plaintiff obtained approval for use of the instant second house on October 5, 199, the new house acquisition period for national housing as stipulated in Article 99 of the former Restriction of Special Taxation Act, but Article 3 subparag. 1 of the former Housing Construction Promotion Act (amended by Act No. 6916 of May 29, 2003; hereinafter the same shall apply) provides that “national housing” means a house constructed or improved with funding from the National Housing Fund under Article 10. According to the results of fact-finding by the Minister of Land, Transport and Maritime Affairs, since the instant second house can be recognized as a house, other than a house constructed or improved with funding from the National Housing Fund under Article 10 subparag. 1 of the former Housing Construction Promotion Act, which corresponds to a house of 0 or more houses as stipulated in Article 3 subparag. 1 of the former Housing Construction Promotion Act (amended by Presidential Decree No. 24150, Mar. 1, 2008).

4. Conclusion

Therefore, the part of the plaintiff's claim for imposition of capital gains tax as of October 1, 2008 against the plaintiff's lawsuit of this case is unlawful. Thus, the part of the claim for cancellation of imposition of capital gains tax as of January 10, 2009 against the second house of this case shall be dismissed as it is without merit. The judgment of the court of first instance is justified as it is in conclusion, and the plaintiff's appeal is dismissed as it is without merit. It is so decided as per Disposition.