Early High Court Decision 2017J 915 (Law No. 19, 2017)

The acquisition value of the real estate of this case shall be the value confirmed in the previous tax investigation.

Since the acquisition value of the real estate of this case does not have objective and specific proof of the value claimed by the plaintiff, it is reasonable to make the price confirmed in the previous tax

Article 97 (Calculation of Necessary Expenses for Transfer Income)

2018Guhap12317 Revocation of Disposition of Imposing capital gains tax

NewO

O Head of tax office

November 1, 2018

December 20, 2018

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The Defendant’s disposition of imposition of KRW 126,714,820 on December 16, 2016 against the Plaintiff was revoked.

1. Details of the disposition;

A. On July 5, 2002, the Plaintiff completed the registration of transfer of ownership on the ○○○○○○○-dong 000-0 large 1,390.1 square meters (hereinafter referred to as “submerged land”) on the grounds of sale and purchase made on May 9, 2001, and thereafter, on March 3, 2014, sold the pertinent land in KRW 1.7 billion to the largestA, and completed the registration of transfer of ownership in the name of the largestA on April 14, 2014.

B. On May 15, 2014, the Plaintiff: (a) filed a preliminary return of transfer income tax for the year 2014 with the transfer value of the pertinent land as KRW 1.7 billion; and (b) paid KRW 27,070,192 accordingly.

C. After that, the Defendant confirmed the fact that the Plaintiff acquired the pertinent land in KRW 798 million as a result of conducting a tax investigation against the Plaintiff, and subsequently notified the Plaintiff of KRW 126,714,820 of the capital gains tax for the year 2014 (hereinafter “instant disposition”) on December 16, 2016.

D. On February 10, 2017, the Plaintiff appealed and filed a petition for trial with the Tax Tribunal, but the Tax Tribunal dismissed the petition on April 19, 2017.

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, 6 evidence, Eul evidence 1 to 5 (including branch numbers, if any) and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

Since the Plaintiff acquired the key land in KRW 1 billion from a seller, a seller, a shipB and a tea, the instant disposition is unlawful on a different premise.

(b) Related statutes;

It is as shown in the attached Form.

C. Determination

1) Relevant legal principles

Considering that the burden of proof of tax base, which is the basis of taxation in a lawsuit seeking cancellation of capital gains tax, is on the tax authority, and the tax base is the tax authority, and the burden of proof of necessary expenses, such as transfer value and acquisition value, is, in principle, on the tax authority, since the tax base is deducted from necessary expenses, such as acquisition value, etc., from the transfer value, but most of the facts that generated necessary expenses are favorable to the taxpayer and are located in the area controlled by the taxpayer, and thus it is easy to prove them, it accords with the concept of fairness (see, e.g., Supreme Court Decision 2002Du1588, Sept. 23,

2) Specific determination

Therefore, in full view of the following circumstances recognized by the purport of the entire arguments and evidence as seen earlier, it is insufficient to acknowledge that the acquisition value of the pertinent land was one billion won only with the evidence submitted by the Plaintiff, and there is no other evidence to acknowledge it. Rather, it is reasonable to deem that the actual acquisition value is KRW 798 billion. Therefore, the Plaintiff’s assertion on a different premise is without merit.

A) There is no objective sales contract which can be deemed that the Plaintiff purchased the pertinent land at KRW 1 billion. Rather, there is only a sales contract (Evidence A3) with the terms of purchasing KRW 630,000,000 from a seller on June 7, 2002, which is a multi-purpose contract (Evidence B), which is the purchase price of KRW 600,000,000,000, (Evidence B), [No real estate sales contract (Evidence 5 of June 27, 2002, which was written with KRW 1,000,000,000, KRW 60,000,000,000,000,000,000,0000,000,000,000,000,000,000,000,000,000,000,000,000,000,00,00,00).

B) On May 20, 202, the Plaintiff: (a) stated that the purchase price of the pertinent land was KRW 1 billion; (b) stated 10,000,000 as down payment; (c) concluded a sales contract with an intermediate payment of KRW 446,00,000 as of June 20, 202; and (d) stated that the Plaintiff would have been paid KRW 454,00,00 as the remainder payment until July 6, 2002; and (b) stated that the Plaintiff would have mediated such transactions (Evidence 5); (c) based on the facts that the Plaintiff would have received KRW 60,00,00 in cash, it is difficult to find that the Plaintiff would have paid KRW 10,000 as the intermediate payment and the remainder payment of KRW 45,00,00,000,000,000 for KRW 20,000,000,000,000. Furthermore, there is no special reason for the Plaintiff’s statement 2.

C) EB testified to the effect that 100,000 won was finally 99,00,000 won upon the Plaintiff’s request from 100,000 won at the time of the transaction. However, EB testified testified to the effect that the specific amount of down payment, intermediate payment, and the remaining payment period or method thereof would not be memory. ② Furthermore, EB andCC prepared a contract with the Plaintiff at KRW 630,00,00,00 and reported the transfer income tax on the transfer of the pertinent land, 79,000 won, and the Plaintiff paid the transfer income tax on KRW 20,000,000,000,000,000,000,000,0000,000,000,000,000,000,000,000,000,000,000,000,00,000 won.

D) Under the premise of the instant disposition, “70 million won” was recognized by the regional tax office around 2004 in the course of conducting a tax investigation to impose capital gains tax on 200 million won and 30 billion won of the land at issue, and ① 200 million won was investigated throughout the entire transaction, including doubleB and nextCC’s financial account at the time of the tax investigation, and 798 billion won was recognized as legitimate transfer income tax, and 200 billion won was testified to the effect that the Plaintiff’s first 70 billion won of the land at the time of the tax investigation, which was determined as 9 billion won of the above 700 billion won of the land at the time of the tax investigation, was not determined as 70 billion won of the above 700 billion won of the acquisition value of the Plaintiff’s land at the time of the tax investigation, and the Plaintiff’s 1 billion won of the above 700 billion won of the acquisition value of the land at the time of the tax investigation, which appears to have not been determined as 9 billion won of the above 7000 billion won of the tax investigation.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.