The burden of proving and proving the price fluctuation in order to regard the sale price after six months from the date of donation as the market price at the time of donation

In calculating the value of donated property under Article 9(1) of the Inheritance Tax Act, the tax authorities should prove that there was no price fluctuation in the land at the market price at the time of donation in order to view the sales price which was later than six months after the date of donation as the market price at the time of donation.

Articles 34-5 and 9(1) of the Inheritance Tax Act, Article 5 of the Enforcement Decree of the Inheritance Tax Act

Supreme Court Decision 85Nu623 Decided March 11, 1986

Plaintiff 1 et al., Counsel for the plaintiff-appellant Kim Jong-chul, Counsel for plaintiff-appellant

The director of the tax office.

Seoul High Court Decision 87Gu571 delivered on December 7, 1987

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

In principle, if the provisions of Articles 34-5 and 9(1) of the Inheritance Tax Act and Article 5(1) and (2)1 of the Enforcement Decree of the same Act are gathered, the value of the donated property, which is the taxable value of the donated property, shall be based on the market value at the time of donation. However, if it is difficult to calculate the market value, the value of the land, buildings, the value assessed by the rate method in the case of specific areas determined by the Commissioner of the National Tax Service, and the tax standard market value under the Local Tax Act in the other areas, the tax authority bears the burden of proving the value of the donated property. On the other hand, the market value at the time of donation means the objective exchange value at the time of donation, and the objective exchange value in the case of land means the change at any time according to the passage of time and changes in the surrounding environment. Thus, in this case, in order to view the donated land as the market value at the time of donation, the tax authority must prove that there was no price change in the relevant land at the time of donation.

In the same purport, the court below determined that the disposition imposing gift tax and defense tax of this case on the price of the gift property of this case was unlawful on the ground that part of the gift property of this case was sold at KRW 1,100,000 as of December 27, 1984 within six months from the date of donation, and that the value was not immediately deemed the market price at the time of donation of this case, and that if the value was viewed as the market price at the time of donation of this case, there is no evidence to prove that there was no change in price between them, and therefore, there is no evidence to prove that there was no change in price at the time of donation of this case.

In addition, the fact that the Korea Appraisal Board did not investigate the changes in the nationwide market price between April 1, 1984 and April 1, 1985, it cannot be said that there was no price fluctuation in the land of this case during that period. Therefore, the opposing opinion argues that the judgment below erred by the rules of evidence against the rules of evidence is groundless.

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Park Jong-dong (Presiding Justice)