The appeal is dismissed.

The costs of appeal are assessed against the Plaintiff.

The grounds of appeal are examined.

1. As to the grounds of appeal Nos. 1 and 2

A. Article 43(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 5582 of Dec. 28, 1998) and Article 41-2(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 6780 of Dec. 18, 2002) (hereinafter referred to as the “instant statutory provisions”) provide that where the actual owner and the nominal owner are different in terms of property which requires registration, etc. in the transfer or exercise of rights, the actual owner shall be deemed to have been donated or donated on the date when registration, etc. is made to the nominal owner, notwithstanding Article 14 of the Framework Act on National Taxes.

The instant legal provision is one of the exceptions to the substance over form principle, and it is presumed or deemed as a donation to the extent that the title trust system is intended to realize tax justice by preventing abuse as a means of tax avoidance, and does not change whether the title trust property belongs to the title trust property. Thus, notwithstanding the instant legal provision, the actual attribution of the title trust property is still governed by the legal relationship, such as the title trust (see, e.g., Supreme Court Decision 2004Du11220, Sept. 22, 2006).

For the reasons indicated in its reasoning, citing the reasoning of the judgment of the court of first instance, the court below held that (1) the Plaintiff’s entry into a stock company as indicated in the judgment of the court below and transfer 21.25% of the shares to the Plaintiff through three times or more under a title trust, shall belong to D substantially to the title truster of the first nominal trust shares (hereinafter “lost share”) and as D pays the subscription price and accepts new shares by exercising the preemptive right under the name of the Plaintiff, the shares with capital increase should be deemed additionally trusted to the Plaintiff. In light of the circumstances indicated in its judgment, the court below held that (2) the shares with capital increase should be deemed additionally trusted to the Plaintiff.