[1] The meaning of "de facto acquisition" under Article 105 (2) of the Local Tax Act

[2] The time of de facto acquisition under Article 105 (2) of the Local Tax Act and the method of determining the amount of debt where the purchaser of real estate agrees to take over the obligation of the subject matter of sale and deduct the amount of debt from the sales balance

[1] Article 29(1)1 of the Local Tax Act provides that an object of taxation of acquisition tax shall be established when it acquires such object. Article 105(2) of the Local Tax Act provides that an object of taxation of acquisition tax shall be deemed to have been actually acquired even if it is not registered under the provisions of relevant Acts and subordinate statutes, such as the Civil Act. Here, the term “actual acquisition” refers to a case where an object of taxation of acquisition tax fails to meet the formalities of acquisition of ownership such as registration, but satisfies the substantive requirements of acquisition

[2] In a case where the purchaser of a real estate has agreed to take over the obligation regarding the subject matter of sale and to deduct the amount of such obligation from the sale balance, the actual acquisition time of Article 105(2) of the Local Tax Act refers to the time when the remaining amount can be concurrent with the payment in general sale according to the specific facts. In determining this, the determination should be made by taking into account the following circumstances: (a) whether the obligee has expressed his/her consent or intent to make profits according to the nature of the assumption of the obligation; and (b) whether there was a delivery of ownership transfer

[1] Articles 29(1)1 and 105(2) of the Local Tax Act / [2] Article 105(2) of the Local Tax Act

[1] Supreme Court Decision 92Nu16843 delivered on September 28, 1993 (Gong1993Ha, 2997) Supreme Court Decision 96Nu17486 delivered on July 11, 1997 (Gong1997Ha, 2546), Supreme Court Decision 99Du5955 delivered on November 12, 199 (Gong1999Ha, 2538)

Plaintiff

Kimcheon-market

Daegu High Court Decision 9Nu1114 delivered on February 18, 2000

The judgment below is reversed, and the case is remanded to the Daegu High Court.

We examine the grounds of appeal.

1. According to the reasoning of the judgment below, when the plaintiff entered into a sales contract with the non-party to purchase the real estate of this case from the non-party on February 11, 1998 to purchase 100,000,000 won for down payment of KRW 10,000 and intermediate payment of KRW 40,000,000 for the plaintiff's loan claims against the non-party, and the remainder of KRW 50,000 for the loan claims against the non-party to the non-party to the non-party 1,00,000 for the non-party 1,00,000 won for the loan obligations against the non-party 1,00,000 won for the non-party 1,000,000 won for the real estate of this case, the court below determined that even if there was a dispute between the plaintiff and the non-party on the market price of the real estate of this case and the non-party 25,000, it had not been affected by the agreement.

2. However, Article 29(1)1 of the Local Tax Act provides that acquisition tax shall be deemed liable for payment at the time of acquisition of real estate. Article 105(2) of the Local Tax Act provides that acquisition shall be deemed to have been acquired even if a person fails to perform registration, etc. under the provisions of relevant Acts and subordinate statutes, such as the Civil Act. Here, de facto acquisition refers to a case which generally fails to meet the formal requirements for acquisition of ownership such as registration, but meets the substantive requirements for acquisition of ownership such as payment of purchase price (see Supreme Court Decision 98Du17067, Nov. 12, 199). In the event a purchaser of real estate has agreed to deduct the amount of debt from the remaining purchase price, the time of actual acquisition under Article 105(2) of the Local Tax Act becomes due at the same time as the payment of remaining price in general sale according to specific facts. In determining this, whether the obligee has expressed his/her intent to assume the obligation or has fulfilled the obligation, etc. based on the nature of the obligee’s delivery of registration of ownership.

Nevertheless, the court below made a report that the plaintiff acquired the real estate of this case immediately due to the arrival of the remaining payment date under the sales contract without any deliberation as to such circumstances, and held that even if the plaintiff and the non-party had terminated the above sales contract, it cannot affect the exercise of the already established tax claim. The court below erred by misapprehending the legal principles on acquisition, which affected the conclusion of the judgment, by failing to exhaust all necessary deliberations.

3. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Han-gu (Presiding Justice)