early 2010 Heavy1203 (23, 2010)

Agreements received on the condition of withdrawal of action in legal disputes shall be other income.

The agreed amount received on the condition of withdrawal of the lawsuit in legal dispute is an honorarium and subject to taxation of global income tax as it falls under other income.

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

1. Each of the plaintiffs' claims is dismissed.

2. The costs of lawsuit are assessed against the plaintiffs.

The Defendant’s imposition of KRW 128,534,130 of global income tax on March 1, 2010 against Plaintiff EA and the imposition of KRW 35,556,200 of global income tax on Plaintiff EB for the year 2005, respectively, shall be revoked.

1. Details of disposition;

A. On June 2, 2005, the plaintiffs filed a lawsuit on June 2, 2005 against AA, BB,CC species, and D D species (hereinafter collectively referred to as "the clan of this case") for the implementation of the procedure for registration of cancellation of each registration of preservation of ownership and the confirmation of ownership (hereinafter referred to as "the land of this case"), which were closed in the future of the clan of this case, on the ground that the cause is null and void as to the land of 21 square meters in ○○○○○○○○, ○○-Eup, ○○, 9,514 square meters in forest (hereinafter referred to as "the land of this case").

B. The plaintiffs received a total of KRW 380,000,000 (Plaintiff regularA 280,000,000 + KRW 100,000,000,000 (hereinafter “the instant agreement amount”) from the instant clan, and withdrawn the registration of cancellation of the instant case on December 13, 2005.

C. The Defendant considered the instant agreed amount received by the Plaintiffs as other income under Article 21(1)17 of the Income Tax Act, and imposed KRW 35,556,200 on March 1, 2010, as global income tax for 2005, as global income tax for 128,534,130, and as for HaB, for HaB, 35,556,200 (hereinafter “instant disposition”).

D. Accordingly, on March 31, 2010, the Plaintiffs filed an appeal with the Tax Tribunal to seek the revocation of the instant disposition, but each of them was dismissed on June 23, 2010.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1, 2, 3, 5, Eul evidence No. 1 (including each number), part of witness standing, and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiffs' assertion

The litigation for the cancellation registration of this case was originally owned by the plaintiffs, without any cause, seeking the cancellation of the registration of the ownership of the land in the name of the clan of this case and the confirmation of the plaintiffs' ownership. It did not seek monetary payment. The agreement of this case was withdrawn from the lawsuit to avoid risk that the plaintiffs will incur when they won all, and was paid as the agreement money from the clan of this case. Accordingly, the agreement of this case is not "other income under the Income Tax Act."

(b) Fact of recognition;

1) The Plaintiff’s co-ordinationd and MadD, the Republic of Korea, had been identified as the owner of the instant land at the time of the land research project, which was Gangwon-do Land Survey Project.

2) On July 1, 1918, JeongCC died on July 1, 1918, and he succeeded to the property of static, and on November 5, 1980, static died, and the Plaintiffs jointly succeeded to the property of static.

3) On June 5, 1974 and June 29, 1985, the clan of this case completed each registration of initial ownership in the name of the clan of this case.

[Ground of recognition] Evidence, Gap evidence Nos. 4-1 and 2-2, the purport of the whole pleadings

C. Key statutes

As shown in the attached Form (the year of personal use shall not be indicated).

D. Determination

Article 21 (1) 17 of the Income Tax Act provides as one of the other income, the term "compensation" refers to money and goods provided as a meaning of a case in connection with administrative affairs or provision of services, and whether it is applicable should be determined by comprehensively taking into account the motive and purpose of receiving the relevant money and goods, relationship with the other party, amount, etc. (see, e.g., Supreme Court Decision 97Nu20304, Jan. 15, 1999).

In full view of the aforementioned evidence and evidence No. 2, the following facts and circumstances can be acknowledged in light of the purport of the entire pleadings.

① In order to avoid damages to be incurred by the entire loss of the clan in the lawsuit for the registration of cancellation of this case, the plaintiffs and the plaintiffs renounced their claims for the registration of cancellation of this case, and instead, they agreed that the clan of this case shall pay the agreement of this case. ② The plaintiffs withdraw the lawsuit for the registration of cancellation of this case filed against the clan of this case on December 13, 2005 according to the above agreement and received the agreement of this case.

According to the above facts, the agreement of this case shall be deemed to have been paid to the plaintiffs in return for the waiver of the plaintiffs' claim against the land of this case and the withdrawal of the registration of cancellation of this case (the plaintiffs filed a lawsuit with considerable grounds, and the plaintiffs may display their rights to the land of this case while the lawsuit is pending, and even if the plaintiffs received the agreement of this case in lieu of giving up their rights, income is generated from the transfer or exchange of rights at a rate) therefore, the disposition of this case where the defendant regarded the agreement of this case as the "compensation" under Article 21 (1) 17 of the Income Tax Act is legitimate.

3. Conclusion

Thus, the plaintiffs' claim of this case is dismissed as it is without merit.