[1] The scope of corporate tax, etc. to be deducted in calculating net profit and loss to calculate the profit exchange value of unlisted stocks subject to gift tax

[2] The standard for assessing the net asset value of unlisted stocks subject to gift tax in calculating the net asset value of unlisted stocks

[3] In a case where, even if there is no distributable profit, the weighted average amount of net profit and loss for the last three years has continuously been specified, whether it can be seen as "0" in the value of net profit and loss exchange of stocks (negative)

[1] In calculating the net profit and loss amount for calculating the net profit and loss amount per share (the weighted average amount of net profit and loss for the last three years per share divided by the profit exchange rate as stipulated by the Ordinance of the Ministry of Finance and Economy) when assessing the value of unlisted stocks subject to gift tax, the corporate tax amount, etc. to be deducted from the income for each business year pursuant to Article 5 (5) 1 (e) (4) of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 12993 of May 1, 190) refers to the tax amount actually paid or to be paid, and therefore, it is not the calculated tax amount before the tax reduction or exemption

[2] In calculating the net asset value per share of unlisted stocks subject to gift tax (the amount calculated by dividing the net asset value of the relevant corporation by the total number of issued stocks), it is reasonable to view the net asset value of the corporation as the book value of the last input which excludes expected profits from the assessment of the product value held by the company.

[3] Article 5 (5) 1 (e) of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 12993, May 1, 1990) provides that the amount of net profit and loss to assess the profit and loss value of stocks shall be based on the income for each business year under Article 9 of the Corporate Tax Act, and assumes a premise of estimated net profit, not the distributable profit. Thus, the cumulative circumstances of losses carried forward do not affect the calculation of net profit and loss, and in case where the company's management status has improved and the weighted average amount of net profit and loss for the last three years has continuously and regularly been calculated, it shall not be deemed that it does not constitute "0" and it does not constitute a reasonable and objective evaluation.

[1] Article 9 (1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 4662 of Dec. 31, 1993) (see Article 60 (1) of the current Inheritance Tax and Gift Tax Act), Article 5 (5) 1 (e) of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act (amended by Presidential Decree No. 12993 of May 1, 1990) (see Article 56 (3) 2 (a) of the current Enforcement Decree of the Inheritance Tax and Gift Tax Act) / [2] Article 9 (1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 4662 of Dec. 31, 1993) (see Article 60 (1) of the current Inheritance Tax and Gift Tax Act), Article 5 (2) 4 and (5) 1 (b) of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act (amended by Presidential Decree No. 12998 of May 1, 1990) (see Article 196 (2) of the current Enforcement Decree of the Inheritance Tax and Gift Act)

[1] [2] [3] Supreme Court Decision 96Nu2408 delivered on February 14, 1997 (the same purport)

Cho Jong-sung (Attorney Jeon Jong-gu, Counsel for defendant-appellant)

The Head of Gwangju District Tax Office (Attorney Lee Jae-soo, Counsel for the plaintiff-appellant)

Supreme Court Decision 93Nu18891 delivered on December 10, 1993

Seoul High Court Decision 94Gu745 delivered on December 29, 1995

The part of the lower judgment against the Defendant is reversed and that part of the case is remanded to the Seoul High Court. The Plaintiff’s appeal is dismissed, and the costs of appeal are assessed against the Plaintiff

1. We examine the Plaintiff’s grounds of appeal.

A. On the first ground for appeal

According to the reasoning of the judgment below, the court below rejected the judgment of the court below on the grounds that since the transaction price between the non-party Park Jong-man and Cho Jong-man on the shares of the non-party Cho Il-sung Co., Ltd. (hereinafter referred to as the "non-party company") was caused by a transaction conducted in a special situation where only the foreign investor disposes of all the shares to the national and intends to recover the investment principal, the market price of the non-party company's shares cannot be appropriately reflected, and that the appraisal price of the non-party Han-han Securities Co., Ltd. and the alternative securities Co., Ltd. cannot be

B. On the second ground for appeal

In evaluating the buildings and machinery, equipment, etc. of the non-party company, it is reasonable for the court below to consider the price on the appraisal report as the market price at the time of donation, and it does not require depreciation as long as the appraisal price is deemed the

In addition, since the corporate tax amount to be deducted under Article 5 (5) 1 (e) (4) of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 12993 of May 1, 1990) refers to the tax amount actually paid or payable, it shall be deemed that it is not the calculated tax amount before the tax reduction or exemption is made, but the determined tax amount. The judgment below to the same purport shall be justified and there is no violation of law as pointed out in the

2. We examine the defendant's grounds of appeal.

A. On the first ground for appeal

It is reasonable for the court below to assess the value of the product held by the non-party company at the book value, which is the final input who excluded estimated profits in assessing the value of the product. There is no error of law by misapprehending legal principles as

B. On the second ground for appeal

According to the reasoning of the judgment below, according to the supplementary evaluation method under the Enforcement Decree of the Inheritance Tax Act, the profit exchange value per share to calculate the value of the stocks of the non-party company shall be KRW 5,516 (the profit exchange value per share for the last three years shall be KRW 5,160,00 divided by the weighted average amount of net profit and loss per share for the last three years, but it seems to be erroneous in the court below's decision that the non-party company is a gold 5,516 won). The non-party company was in a situation where it is unable to make dividends to the shareholders because of the lack of net profit due to the excessive cumulative loss that has been accumulated in the past, and it is difficult to resolve the above impossible condition until March 195, which is the maturity of the redemption of special profit to the Korea Exchange Bank, and therefore, it is reasonable to view the profit exchange value as the value of the stocks of this case, and the reasonable and objective profit exchange value at the time of donation of the stocks of this case as 00.

However, Article 5 (5) 1 (e) of the Enforcement Decree of the same Act provides that the amount of net profit and loss for assessing the profit-sharing value of stocks shall be based on the income for each business year under Article 9 of the Corporate Tax Act. The premise of the estimated profit and loss rather than the distributable profit, and the cumulative calculation of losses carried forward, etc. does not affect the calculation of net profit and loss, and if the average weighted average amount of net profit and loss for the last three years is continuously and clearly determined as the management status of the company prior to the transfer of management status as the non-party company, it shall not be deemed that it does not constitute "0" and it shall not be reasonable and objective evaluation.

Therefore, the court below's determination of the value of the shares in this case according to the supplementary evaluation method under the Enforcement Decree of the same Act is '0' in calculating the value of the shares in this case, because it erred in the misapprehension of the legal principle as to the appraisal of the value of the property in this case, the argument about this issue is justified.

3. Conclusion

Therefore, the part of the lower judgment against the Defendant is reversed, and that part of the case is remanded to the lower court for further proceedings consistent with this Opinion. The Plaintiff’s 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 Lee Don-hee (Presiding Justice)