Seoul Administrative Court 2006Gudan12435 (No. 11, 2008)

Where land is divided, whether there is no officially assessed land price;

In case of the partial transfer of land, if the characteristics of the land which form the basis for calculating the officially assessed individual land price are changed due to the division of the land, and there are special circumstances to deem it unreasonable to regard the officially assessed individual land price after the division as the publicly assessed individual land price of the land.

The contents of the decision shall be the same as attached.

Article 99 (Calculation of Standard Market Price of Income Tax of the Gu)

Article 164 (Assessment of Standard Market Price of Land and Building)

The part of the judgment of the first instance against the plaintiffs shall be revoked.

The imposition of KRW 106,61,600 among the imposition of KRW 110,693,400 on October 4, 2005 and the imposition of KRW 106,661,60 on the Plaintiff New ○○ on September 8, 2005 by the head of the Nowon-gu Tax Office, which was imposed on the Plaintiff New ○○ on September 8, 2005 by the head of the Nowon-gu Tax Office, shall revoke all of KRW 106,61,60 among the imposition of KRW 109,893,450 on the Plaintiff New ○.

All costs of litigation shall be borne by the Defendants.

The purport of the claim is to revoke the imposition of KRW 110,693,400 for the transfer income tax of 2004 on October 4, 2005 and the imposition of KRW 109,893,450 for the transfer income tax of 2004 for the Plaintiff New ○○ on September 8, 2005 by the head of the Nowon District Tax Office ("10,693,400 won as stated in the head of the tax office") by the head of the Nowon District Tax Office on the Plaintiff New ○○ on September 4, 2005.

The purport of appeal is as set forth in the Disposition.

1. Details of the disposition;

A. On October 25, 1996, the Plaintiffs, new ○○○, and new ○○○○○○-4 forest 71,688 square meters (hereinafter “instant land before the instant partition”) were jointly inherited (per 1/4 equity shares), and entered into a contract on April 16, 2004 by specifying the location of 38,513 square meters of land before the instant partition, which is part of the land before the instant partition, and selling ○○○ C&D Co., Ltd. for ○○○○○○○○○, Inc. for sale at KRW 4.4 billion.

B. On October 12, 2004, the Plaintiffs, new ○○-dong, ○○-3 Forest land, 71,688m2, which was registered prior to the instant partition, was divided into 38,569m2 (hereinafter “instant land”) and 00,33,119m2 on the same day on the same day. On November 9, 2004, the said buyers completed the registration of ownership transfer on the instant land.

C. On December 15, 2004, with regard to the transfer of the land of this case to the head of the Labor Relations Office of Korea on January 1, 2004, the Plaintiff paid KRW 24,452,625 as capital gains tax while filing a preliminary return on the transfer income tax based on the officially assessed individual land price as of January 1, 2004. The Plaintiff’s new capital was paid KRW 24,452,625 as capital gains tax when filing the preliminary return on the transfer income tax by the said method to the head of the labor office of Dongdae-gu on December 15, 2004.

D. Under Article 164(1) of the former Income Tax Act (amended by Act No. 7289, Dec. 31, 2004; hereinafter referred to as the “Act”), the head of the Dong-gu Tax Office imposed an additional tax on the Plaintiff New 00 won for the reason that the instant land falls under the land divided under the proviso of Article 99(1)1 (a) of the former Income Tax Act and Article 164(1)2 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 19, Feb. 19, 2005; hereinafter referred to as the “Enforcement Decree”), taking into consideration the appraisal value of the instant land as of October 12, 2004, taking into account the appraisal value of the ○○ Appraisal Corporation and the ○○ Appraisal Board, the head of the tax office imposed an additional tax on the Plaintiff 120,59,610 won for the transfer income tax of 204 and the additional tax on the Plaintiff 201636.4.6

E. On October 11, 2006, the head of the Seoul Regional Tax Office, the head of the Seoul Regional Tax Office, excluded the portion of the additional tax on negligent tax returns from the above disposition against the Plaintiff New Mandong, and decided to correct the amount of tax. Accordingly, on February 6, 2006, the head of the Defendant Nowon District Tax Office issued a corrective disposition that reduces the amount of 10,666,160 won for negligent tax returns from among the above disposition against the Plaintiff New Mandong. The National Tax Tribunal decided to exclude the portion of the additional tax on negligent tax returns from the above disposition against the Plaintiff New Mandong, thereby correcting the amount of tax. Accordingly, on October 11, 2006, the head of the Dongdae District Tax Office issued a corrective disposition that reduces the amount of tax to 10,66,160 won among the above disposition on the Plaintiff New Mandong's additional tax on the Plaintiff 100,693,400 won (16,1696,1605 won).

[Ground of recognition] Facts without dispute, Gap evidence 1-1 to Gap evidence 7-2, Eul evidence 1-1 to Eul evidence 8, the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiffs' assertion

(1) Supreme Court Decision 94Nu6840 Decided December 9, 1994 and Supreme Court Decision 2000Du8165 Decided February 23, 2001 ruled that in a case where part of the land was transferred in installments, the same individual land price may not be deemed land without any individual land price, since the same individual land price is applicable to the assessment of the standard market price of the divided land as long as the individual land price was publicly announced as to the land before the division at the time of division. In light of the above legal principles, since the individual land price as of January 1, 2004 was publicly announced as of January 1, 2004, the land in this case does not constitute the land without the individual land price as of February 1, 200 and Article 164(1)2 of the Enforcement Decree of the Act.

(2) Since the appraisal of the instant land by ○○ Appraisal Corporation and the Korea Appraisal Board did not fully state the grounds for comparison of goods, etc. and other factors for price assessment, the appraisal of the instant land by taking such appraisal prices into account is unlawful.

(3) If the land is divided and transferred partially, the transfer income tax burden should be imposed on the transfer of the entire land rather than on the transfer of the entire land. If the transfer value of the land of this case is calculated based on the appraisal value equivalent to the actual market price, the transfer value of the land of this case exceeds 150% of the transfer value of the entire land before the division, which is contrary to

(4) The Defendant calculated the transfer value of the instant land at the price actually equivalent to the market price, and calculated the acquisition value at the officially announced price, which is in violation of the same standard calculation principle as stipulated in Article 100(1) of the Act.

(5) If the land of this case constitutes a land without a publicly assessed individual land price as the land that has been divided under the Cadastral Act under Article 164(1)2 of the Enforcement Decree, there is no way for the head of the competent tax office to voluntarily pay the exact amount of capital gains tax until the assessment of the price of the land of this case is made.

(b) Related statutes;

Article 99 (Calculation of Standard Market Price of Income Tax of the Gu)

Article 164 (Assessment of Standard Market Price of Land and Building)

C. Determination

First, we examine the argument that the land in this case does not constitute a land without a publicly assessed individual land price.

In light of the fact that only the method of assessing the value of the land without a publicly assessed individual land price is delegated to the Enforcement Decree, and that the scope of the land without a publicly assessed individual land price is not delegated to the Enforcement Decree, it cannot be deemed that no publicly assessed individual land price exists under the Cadastral Act as stipulated in Article 164(1)2 of the Enforcement Decree. Meanwhile, if a publicly assessed individual land price is publicly notified as to the land before subdivision at the time of subdivision, the same individual land price can be applied when assessing the standard market price of the divided land. In light of the fact that a partial transfer of the land was publicly notified as to the land before subdivision at the time of subdivision, if the publicly assessed individual land price was publicly notified as to the land before subdivision at the time of subdivision, it cannot be deemed that the divided land in principle is a land without a publicly assessed individual land price as stipulated in the proviso of Article 99(1)1 (a) of the Act. However, if there are special circumstances to view the land price after the subdivision as the basic data for calculating the publicly assessed individual land price after subdivision, it is reasonable to view.

As of October 1, 2004, there was no dispute between the parties that the current officially assessed individual land price was publicly announced as of January 1, 2004 with respect to the land before subdivision of the instant land at the time of subdivision of the instant land. As the land characteristics were changed due to the division of the instant land, whether there are special circumstances to deem it unreasonable to regard the individual land price of the instant land before subdivision as the land price of the instant land. In full view of the purport of the arguments, the Plaintiffs sold the instant land on the premise that the instant land was used for apartment construction on April 16, 2004, on the premise that the Plaintiffs sold the instant land to ○○ C&D Co., Ltd., Ltd., the purchaser of August 17, 2004, and the Korea Land Corporation did not recognize the land use consent to use the instant land as the land price of the instant case on July 5, 2004 as the land price of the instant case. However, there was no other evidence to recognize the fact that the instant land was newly constructed apartment land price of this case.

Rather, comprehensively taking account of the overall purport of the pleadings in the statements No. 3-1 and No. 3-2 and No. 3-3, it is reasonable to view that the characteristics of the instant land have changed only when the housing construction project plan approved on Nov. 20, 2004 when the instant land was divided and the ownership transfer registration was completed on Nov. 20, 2004, and the instant land was designated as a Class-I district unit planning zone after the said housing construction project was approved. In light of the above facts, it is reasonable to view that the characteristics of the instant land were changed only when the housing construction project plan approved for the new apartment construction project plan for the instant land was completed on Nov. 20, 204.

Ultimately, insofar as it is deemed unreasonable to regard the officially assessed land price of the instant land prior to the instant partition as the land price due to the change in the characteristics of the instant land due to the division, the instant land does not constitute a publicly assessed individual land price under the proviso of Article 99(1)1 (a) of the Act, and thus, the instant disposition that need not be examined further is unlawful and revoked.

3. Conclusion

Therefore, the plaintiffs' claims in this case are justified, and since the part against the plaintiffs in the judgment of the court of first instance is unfair with different conclusions, it is so revoked and it is so decided as per Disposition with the assent of all.