Suwon District Court 201Mo6777 ( November 10, 2011)

early 2010 Heavy2906 (201.03.09)

The disposition that excluded the reduction or exemption of substitute farmland is legitimate because it is difficult to recognize that the previous farmland was cultivated directly.

Although it is alleged that the previous farmland was not leased and the previous farmland was transferred directly, it is difficult to recognize that the previous land was cultivated for not less than three years in view of the fact that the third party submitted a written confirmation that he cultivated various kinds of vegetables in the farmland, etc., the disposition excluding capital gains tax reduction or exemption on the substitute farmland is legitimate

Article 70 of the Restriction of Special Taxation Act

2011Nu42651 Revocation of disposition of imposing capital gains tax

right XX

Head of Ansan Tax Office

Suwon District Court Decision 201Guhap6777 Decided November 10, 2011

June 21, 2012

July 5, 2012

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. The imposition of capital gains tax of KRW 000 for the year 2008 imposed by the defendant on February 8, 2010 shall be revoked.

1. The reasoning for the judgment of the court of first instance is reasonable, and thus, it is cited in accordance with the main sentence of Article 420 of the Civil Procedure Act.

2. The plaintiff asserts that the appellate court did not lease the farmland of this case to the competentA, and that since the plaintiff directly cultivated and transferred the farmland of this case, the farmland of this case should be allowed the reduction or exemption of capital gains tax for the substitute land of self-arable.

Therefore, according to the provisions of Article 70(1) of the former Restriction of Special Taxation Act (amended by Act No. 921 of Jan. 1, 2010), which applies to the disposition of this case, and Article 67(1), (2), and (3)1 of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 22037 of Feb. 18, 2010), in order to constitute an exemption from capital gains tax due to substitute land, one shall be the previous land and new acquired land, and two or more years shall reside in the new location of farmland for three or more years and reside in the new location of farmland for three or more years, and three or more years shall begin with the residing and cultivation. (3) Period between the transfer date of the previous land and the acquisition date of new land shall be one year (see, e.g., Supreme Court Decision 200Da149738 of Feb. 18, 201).

However, according to the facts cited earlier and evidence, etc., ① A has not prepared a confirmation of facts (No. 4, No. 26 pages) in the name of the authorityA stating that “A was present as a witness in the first instance court and had not cultivated directly in the farmland of this case, and had received compensation for the farming of the Housing Corporation on behalf of the Plaintiff after having performed dry field work for the Plaintiff,” and there was no testimony in the said confirmation document that the authorityA had affixed seal (No. 88 pages of the record), ② In addition, the authorityA testified in the first instance court from September 2004 to June 25, 2009 that “A cultivated various kinds of vegetables in the farmland of this case” had signed on the farmland of this case from September 4, 204 to June 25, 2009 (Evidence No. 4, No. 53 pages, No. 81 of the record, etc.) and the Plaintiff’s assertion that there was no further evidence or evidence submitted by the court.

3. If so, the plaintiff's appeal is dismissed as it is without merit.