In the case of wrongful calculation under the Corporate Tax Act

Article 20 of the Corporate Tax Act and Article 46 (2) of the Enforcement Decree of the Corporate Tax Act mean the case where the corporation concerned attempts to avoid or reduce the tax burden by abusing the various forms of transactions listed in each subparagraph of Article 46 (2) of the Enforcement Decree of the Corporate Tax Act, or the case where the form of transactions is deemed to have neglected the economic rationality even without such intention.

Article 20 of the Corporate Tax Act, Article 46 (2) of the Enforcement Decree thereof

Supreme Court Decision 84Nu37 Decided May 28, 1985, 87Nu357 Decided October 13, 1987, Supreme Court Decision 87Nu174 Decided November 8, 1988

[Defendant-Appellee] Kim Jong-chul et al., Counsel for defendant-appellee

Head of Gwangju District Tax Office

Seoul High Court Decision 87Gu1301 delivered on September 21, 1988

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

As to the grounds of appeal by Defendant Litigation Performers:

According to the reasoning of the judgment below, the plaintiff appraised 1,065,74,600 won as of February 27, 1984 upon request of the Korea Appraisal Board for the purpose of identifying the market price before transferring the real estate of this case. The plaintiff appraised 1,08,524,50 won as of December 12, 1985 as of December 12, 1985 upon request of the Korea Appraisal Board for appraisal in order to provide financing from the Korea Mutual Saving and Finance Company with the above real estate as security. The above appraisal is neither an appraisal at the time of transfer nor an appraisal at the time of transfer of real estate, nor an actual sale price is 93 and 91 percent of the above appraisal price at the time of transfer, but the plaintiff determined that the above appraisal price at the time of selling the factory of this case was 1,065,74,600 won at the time of the sale of the real estate, but it was difficult to view the sale price at the time of the above real estate price at the time of 20.

Article 20 of the Corporate Tax Act and Article 46 (2) of the Enforcement Decree of the Corporate Tax Act where it is deemed that the corporation has unjustly reduced the tax burden on the corporation's income means the case where the corporation concerned intended to unjustly avoid or reduce the tax burden by abusing the various forms of transactions listed in each subparagraph of Article 46 (2) of the Enforcement Decree of the same Act, or where the transaction type is deemed to have neglected the economic rationality without any such intent (see, e.g., Supreme Court Decision 84Nu337, May 28, 1985; Supreme Court Decision 87Nu357, Oct. 13, 1987; 87Nu174, Nov. 8, 198; etc.). In this case, just because the records are shown, it is difficult to recognize that the plaintiff lacks the economic rationality compared to the act of transfer of the real estate in this case to a related party under Article 20 of the Corporate Tax Act and Article 46 (1) of the Enforcement Decree of the same Act.

Therefore, the judgment of the court below which accepted part of the plaintiff's claim is justified as a result, and there is no error like the theory of lawsuit.

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 Yoon Young-young (Presiding Justice)