Seoul Administrative Court 2014Guhap7480 ( October 11, 2015)

any debt exemption for a closed juristic person shall be the donation.

Article 41(1) of the former Inheritance Tax and Gift Tax Act provides that the purport of delegation to the Presidential Decree is to determine whether not only the shareholder's profit is calculated, but also the shareholder's profit is calculated. Ultimately, Article 31(6) of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act provides that a delegation provision under the former Enforcement Decree of the Inheritance Tax and Gift Tax Act cannot be

2015Nu49377 Revocation of Disposition of Imposition of Gift Tax

AA, EB

Head of the District Tax Office

November 18, 2015

January 13, 2016

1. All appeals filed by the plaintiffs are dismissed.

2. The costs of appeal are assessed against the Plaintiffs.

the Gu Office's place of service and place of service

The judgment of the first instance court shall be revoked. The imposition of gift tax of KRW 147,581,310 against the Plaintiff EA on January 1, 2014 and the imposition of KRW 53,634,940 against the Plaintiff EB shall be revoked, respectively.

1. Quotation of judgment of the first instance;

The reasoning for this Court’s explanation is as follows: “The 8th written judgment of the court of first instance is only recognized”; “The following is added to the reasoning for the judgment of the court of first instance, except for the addition of the determination of the plaintiffs’ new arguments in the trial of the court of first instance, it is identical to the reasoning for the judgment of the court of first instance.” As such, it is also accepted by Article 8(2) of the Administrative Litigation Act and the main text of Article 4

The proviso of Article 31(2)1 of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act stipulates that the proviso of Article 31(2)1 of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act shall apply to the case where the company is not able to continue to exist even if the procedure for dissolution is not taken at the time of the discharge of its obligation. However, the Commercial Act lists "an occurrence of any other cause, such as the expiration of the duration of existence, a merger, bankruptcy and court order, a judgment, a division or a merger by split-off, or a resolution at the general meeting of shareholders" (Articles 517 and 227 of the Commercial Act). Article 31(2)1 of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act only excludes the merger or split-off

In light of the principle of strict interpretation, etc., the proviso of Article 31(2)1 of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act shall apply only where a cause for dissolution (excluding merger or division) under the Commercial Act occurs to the relevant corporation.

2. Additional determination

A. The plaintiffs' assertion

Article 41(1) of the Inheritance Tax and Gift Tax Act (amended by Act No. 9916, Jan. 1, 2010) delegates the scope of benefits that a shareholder, etc. of a certain corporation gains to the Presidential Decree, to the Enforcement Decree, on what is the benefit to be deemed as a donation, is contrary to the principle of prohibition of comprehensive delegation.

B. Determination

Article 2 (1) of the Inheritance Tax and Gift Tax Act provides that donated property from another person's gift tax is subject to gift tax. Article 2 (3) of the Inheritance Tax and Gift Tax Act provides that "The term "the term "donation" includes all the things belonging to the donee and all the legal or de facto rights having property value which can be realized in money as property belonging to the donee, and all the tangible and intangible property whose economic value can be calculated, directly or indirectly, to another person (including the case of transferring it at a remarkably low price) or by contribution."

In light of the contents of each of the above provisions and the purport of Article 2(3) of the Inheritance Tax and Gift Tax Act, in order to impose gift tax on the gratuitous transfer or increase in value of various forms that have not been predicted by the legislators, the scope of taxation of gift tax has been expanded by introducing the concept of donation based on the complete universalism. Accordingly, the existing provisions on deemed donation have been changed into the calculation provisions on donated property and Article 41(1) of the Inheritance Tax and Gift Tax Act also is one of them, even if Article 41(1) of the former Inheritance Tax and Gift Tax Act delegates the "profit that a shareholder, etc. of a specified corporation has obtained" to the Presidential Decree and did not expressly specify the scope, the scope or limit of delegation inherent in the above provision can be sufficiently recognized. Therefore, it is difficult to deem that the above provision violates the principle of prohibition

3. Conclusion

Therefore, the plaintiffs' claims are dismissed due to the lack of reason, and the judgment of the court of first instance is just in conclusion, and all appeals of the plaintiffs are dismissed. It is so decided as per Disposition.