Whether Article 58 (1) 2 of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3865 of Dec. 26, 1986) that covers the implementation of an urban redevelopment project under the Urban Redevelopment Act may apply mutatis mutandis to the implementation of an urban redevelopment project under the Urban Planning Act (negative)

The provisions on the requirements for non-taxation and tax reduction and exemption shall be interpreted strictly as in the same manner as the provisions on the requirements for taxation, since the expanded interpretation would result in a result contrary to the principles of tax equity, and the provisions on the exemption of special surtax under Article 58 (1) 2 of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3865, Dec. 26, 1986) shall be limited to the case where a project is implemented in accordance with a project plan determined by the Urban Redevelopment Act. Thus, even if a project implemented under the Urban Planning Act is substantially the same as the implementation of an urban redevelopment project under the Urban Redevelopment Act, the said special surtax exemption provisions may not be extended or analogically applied

Article 58 (1) 2 of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3865 of Dec. 26, 1986)

Supreme Court Decision 83Nu213 delivered on December 27, 1983 (Gong1984, 267) 83Nu709 delivered on June 26, 1984 (Gong1984, 1359) 84Nu475 delivered on October 10, 1984

Postal Development Co., Ltd., Counsel for the plaintiff-appellant

Chuncheon Director of the Tax Office

Seoul High Court Decision 88Gu7806 delivered on October 20, 1989

The appeal is dismissed.

The costs of appeal are assessed against the plaintiff.

The Plaintiff’s attorney’s ground of appeal is examined.

Article 58 (1) 2 of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3865 of Dec. 26, 1986) provides that capital gains tax or special surtax shall be exempted on any income accruing from the transfer of a building constructed in accordance with the project plan determined by the Urban Redevelopment Act and its appurtenant land by the relevant project implementer. According to the facts established by the court below in this case, it is clear that the Plaintiff was not eligible for exemption from the special surtax under the former Regulation of Tax Reduction and Exemption Act on the grounds that the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3865 of Dec. 26, 1986) was granted a permit for an urban planning project under Article 24 of the Urban Planning Act for the existing shopping district (free market) on the land of 57-4 land at the central city in the city of the original city, and it was constructed

The provisions on the requirements for non-taxation and tax reduction and exemption shall be interpreted strictly as in the same manner as the provisions on the requirements for taxation, since the expanded interpretation would result in a result contrary to the principles of tax equity (see, e.g., Supreme Court Decisions 83Nu213, Dec. 27, 1983; 83Nu709, Jun. 26, 1984; 84Nu475, Oct. 10, 1984; 84Nu475, respectively). The above provisions on the exemption of special surtax under the former Regulation of Tax Reduction and Exemption Act are limited to only the case where a project is implemented in accordance with a project plan determined under the Urban Redevelopment Act, and it does not apply to the case where a market newly established by the Plaintiff pursuant to the Urban Planning Act is substantially the same as the implementation of an urban planning project under the Urban Redevelopment Act, and such interpretation cannot be extended or analogically applied to the case where the project is implemented under the Urban Planning Act, such as the theory of substantial taxation.

In addition, we accept the decision of the court below that there is no evidence that the implementation of the project in this case was in accordance with the administrative guidance of the original city, and there is no illegality such as the theory of lawsuit even in the decision of the court below. Therefore, all arguments are 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 Kim Sang-won (Presiding Justice) Lee Jong-won (Presiding Justice)