The meaning of "farmland as of the date of transfer" and "land cultivated by oneself" under Article 5 subparagraph 6 (d) of the former Income Tax Act (amended by Act No. 4019 of Dec. 26, 198), Article 14 (4) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 12564 of Dec. 31, 198), which prescribe the non-taxation of capital gains tax on farmland.

As of the date of transfer under Article 5 subparagraph 6 (d) of the former Income Tax Act (amended by Act No. 4019 of Dec. 26, 198) and Article 14 (4) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 12564 of Dec. 31, 1988), which provides for the non-taxation of capital gains tax on farmland, the term "the date of transfer" must be interpreted to the effect that the term "farmland is farmland at the time of conclusion of a contract of transfer" requires that it should be farmland at the "time of conclusion of a contract of transfer". The term "land cultivated by a person" means "the person's own calculation and responsibility of the person's own intention," and it does not mean only a dry field, tending

Article 5 subparagraph 6 (d) of the former Income Tax Act (amended by Act No. 4019 of Dec. 26, 198), Article 14 (4) of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 12564 of Dec. 31, 1988)

Supreme Court Decision 84Nu541 decided Nov. 27, 1984 (Gong1984, 846) (Gong1985, 95) decided Feb. 23, 1988; 89Nu4567 decided Feb. 27, 1990 (Gong1990, 818)

[Defendant-Appellee] Defendant 1 and 3 others

Head of the Office of Government

Seoul High Court Decision 89Gu1867 delivered on February 22, 1990

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal by the defendant litigant are examined.

According to Article 5 subparag. 6(d) of the Income Tax Act (amended by Act No. 4019 of Dec. 26, 198), Article 14(4) of the Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 12564 of Dec. 31, 1988), “land cultivated by oneself” shall not be subject to the transfer income tax on the income accrued from the transfer of land being actually cultivated as of the transfer date in which it had been cultivated for eight or more consecutive years until the transfer date and which is subject to the assessment of the farmland tax. In this context, “farmland as of the transfer date” shall be interpreted to the effect that “farmland is required to be farmland at the time of the conclusion of the contract” (see, e.g., Supreme Court Decisions 84Nu16, Apr. 10, 1984; 84Nu541, Nov. 27, 1984); and “land cultivated by oneself” shall not be subject to the imposition of the farmland tax on the basis of one’s own calculation and the farmland.

see, e.g., Supreme Court Decision

According to the reasoning of the court below, the plaintiff and the non-party 1 were forest land categoryed as at the time of joint purchase of 17,54 square meters from 5,00,00, 1971, after the fact-finding of the above land on October 18, 1971. However, since around that time, the plaintiff and the non-party 1 cultivated the above land as an orchard and caused the non-party 1 to cultivate it under their responsibilities and calculations under their calculations. The court below's decision that the above land was not registered as a 10,941 square meters for 10,000,000,000, 1971, and it was without merit for the plaintiff to enter the above land in the sale agreement between 3,000,000 and 17,000,0000,000,000 won and 3,000,000,000,000,000.

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 on the bench.

Justices Lee Jong-soo (Presiding Justice) Lee Chang-soo Kim Jong-won