Plaintiff

The head of Gangseo-gu Seoul Metropolitan Government (Bae & Yang LLC, Attorneys Lee Dai-soo, Counsel for the defendant-appellant)

November 4, 2015

Seoul Administrative Court Decision 2013Guhap30575 decided April 18, 2014

Seoul High Court Decision 2014Nu49639 Decided March 6, 2015

Supreme Court Decision 2015Du4002 Decided August 27, 2015

1. The part of the judgment of the court of first instance against the defendant shall be revoked.

2. The plaintiff's claim as to the above cancellation part is dismissed.

3. All costs of the lawsuit shall be borne by the Plaintiff.

1. Purport of claim

The imposition of acquisition tax of KRW 3,304,120 (including additional taxes) and local education tax of KRW 330,410 (including additional taxes) and KRW 330,410 (including additional taxes) as of November 10, 2012 against the Plaintiff, and the imposition of acquisition tax of KRW 3,835,320 (including additional taxes) and local education tax of KRW 352,530 (including additional taxes) as of March 10, 2013 shall be revoked.

2. Purport of appeal

The part against the defendant in the judgment of the court of first instance is revoked, and the plaintiff's claim corresponding to the above revocation is dismissed.

1. Scope of the trial;

In the first instance court, the Plaintiff sought revocation of imposition of acquisition tax and local education tax as of November 10, 2012 and March 10, 2013. The court of the first instance rejected the Plaintiff’s claim for revocation of imposition of acquisition tax and local education tax as of March 10, 2013, and accepted the claim for revocation of imposition of acquisition tax and local education tax as of November 10, 2012. Since only the Defendant appealed against this, the Plaintiff’s appeal is limited to the claim for revocation of imposition of acquisition tax and local education tax as of November 10, 2012.

2. Details of the disposition;

① On July 16, 2012, the Plaintiff and co-defendant 1 concluded each sales contract on cement brickd house ( Address 2 omitted) on the ground of Gangnam-gu Seoul Special Metropolitan City ( Address 2 omitted) (hereinafter referred to as “unborn child”), cement brickd house ( Address 3 omitted), cement brickd house ( Address 3 omitted), and cement brickd house ( Address 4 omitted) between Non-Party 3 and Non-Party 3 ( Address 4 omitted), respectively, ( Address 2 omitted), ( Address 3 omitted), and ( Address 4 omitted), and ( Address 3 omitted) housing ( Address 4 omitted); and ( Address 4 omitted; hereinafter “each housing of this case”). The Plaintiff and co-defendant 2, on August 1, 2012, and the first instance court omitted the registration of ownership transfer on the remaining housing (location 2, 2012 omitted); and (3), on August 21, 2016, 2017.

② On August 2, 2012, the Plaintiff filed a report on the acquisition of housing with the Defendant on August 2, 2012, and filed an application for reduction or exemption with the effect that “it constitutes two houses temporarily owned ( Address 5 omitted) in the Gu-si (hereinafter “Gu-si apartment”), but, within two years from the acquisition date of the housing ( Address 2 omitted), would dispose of the Gu-dong apartment.” The Plaintiff filed a report on reduction or exemption under the premise that 50% of the acquisition tax and local education tax is reduced or exempted pursuant to Article 40-2 of the former Restriction of Special Local Taxation Act (Amended by Act No. 11487, Oct. 2, 2012; hereinafter the same shall apply) and Articles 10(1) and 11(1)7(b) of the former Local Tax Act (Amended by Act No. 12118, Dec. 26, 2013; hereinafter the same).

③ On September 6, 2012, the Plaintiff reported to the Defendant on the acquisition of ( Address 3 omitted) housing and ( Address 4 omitted), and reported and paid the acquisition tax and local education tax on the premise that the acquisition tax and local education tax are reduced by 50% pursuant to Article 40-2 of the Restriction of Special Local Taxation Act and Articles 10(1) and 11(1)7(b) of the Local Tax Act on the ground that the Plaintiff constitutes a temporary 2 housing owner.

④ On November 10, 2012, the Defendant: (a) investigated the current status of housing ownership by the Plaintiff; (b) excluded the application of the provision on reduction and exemption on the ground that “the Plaintiff is not a temporary two housing owner; and (c) added additional tax to the amount of tax reduction and exemption; (d) imposed acquisition tax on KRW 3,304,120 (including additional tax) and local education tax (including additional tax) on KRW 330,410 (hereinafter “instant disposition”).

⑤ The Plaintiff, who was dissatisfied with the instant disposition, filed an objection on December 26, 2012, but was dismissed by the Seoul Special Metropolitan City Mayor on February 19, 2013, and filed an appeal on May 23, 2013, but was dismissed by the Tax Tribunal on September 16, 2013.

[Ground of recognition] Unsatisfy, Gap evidence 1, 6 through 9, Eul evidence 1, 4 through 8 (including branch numbers), and the purport of the whole pleadings

3. Whether the disposition is lawful;

A. The plaintiff's assertion

The Plaintiff acquired each of the instant housing in sequential order for the purpose of removing each of the instant housing and constructing a new multi-household housing. ( Address 2 omitted) At the time of acquiring a housing ( Address 3 omitted), the housing was in the state of losing the function of the housing as a house during removal. Therefore, the instant disposition for imposition is unlawful, since the Plaintiff is two houses per household when acquiring a housing ( Address 3 omitted).

B. Relevant statutes

It is as shown in the attached Form.

(c) Fact of recognition;

① On April 10, 2009, the Plaintiff completed the registration of ownership transfer on a Saturdays-dong apartment.

② The sales contract for each of the instant housing was concluded on July 16, 2012. The terms and conditions of each of the special agreements on each of the instant housing sales contracts include the following: “The seller shall attach the purification tank before the remainder of the contract and a receipt. Within one week after the down payment, the seller shall attach the documents necessary for the building permit.”

③ On August 27, 2012, the Plaintiff, et al., applied for a construction permit to newly build an apartment house (urban-type residential housing) on the ground ( Address 2 omitted), ( Address 3 omitted), and ( Address 4 omitted), and obtained the construction permit from the Defendant on September 5, 2012.

④ On September 7, 2012, the Plaintiff and Co-Defendant 1 reported to the Defendant “date of removal” from September 14, 2012 to September 16, 2012.

⑤ On September 12, 2012, the Plaintiff and Co-Defendant 1 reported to the Defendant the commencement of construction works for newly building urban-type residential housing on the ground ( Address 2 omitted), ( Address 3 omitted), and ( Address 4 omitted) and reported construction waste discharge and disposal performance on September 19, 2012. The Plaintiff and Co-Defendant 1 entrusted the disposal of waste concrete 306.590 tons generated from the removal of each of the instant houses to Dosung Environment Development Co., Ltd., an intermediate disposal business entity by means of crushing and crushing.

6. ( Address 2 omitted) The electricity supply contract for housing was terminated on September 7, 2012, and water supply facilities for housing ( Address 2 omitted) was abolished on September 10, 2012.

7) On September 10, 2012, a person in charge of removing water supply facilities in the site of the North Korean waterworks site. On September 10, 2012, the person in charge of removing water supply facilities visited each of the instant houses for the disuse of water supply facilities. ( Address 2 omitted) Housing glass windows were broken, the windows were removed, but the shape of the building, such as the wall or roof, was preserved. However, there was no screen, etc. for removal.

[Reasons for Recognition] Evidence No. 1-1, 3, 5, Evidence No. 2-1, Evidence No. 2-5, Evidence No. 2-1 through 5, Evidence No. 3-1 through 5, Evidence No. 4-4, Evidence No. 5 and 6, and the purport of the whole pleadings

D. Determination

(1) Interpretation of the relevant statutes

Article 40-2 of the former Restriction of Special Local Taxation Act provides that, until December 31, 2012, the acquisition tax base under the Local Tax Act is to be reduced by 50/100 in cases where a person acquires a house of not more than 900 million won due to a commercial transaction and falls under any of the following subparagraphs. Each subparagraph provides that “where a person becomes a single house (Article 1) and “where a person becomes a temporary two houses prescribed by Presidential Decree (Article 40-2(2) of the Enforcement Decree of the Restriction of Special Local Taxation Act)” (Article 17-2 of the Enforcement Decree of the Restriction of Special Local Taxation Act provides that “where a person becomes a two house temporarily prescribed by Presidential Decree” means cases where a person acquires another house due to the relocation of a director, workplace, school of the person in question or his family, medical treatment of a disease, or any other cause, but fails to dispose of the previous house.”

The Local Tax Act or the Restriction of Special Local Taxation Act does not provide for a separate definition as to “house,” and the Local Tax Act provides for “house,” with respect to acquisition tax, as “house,” under Article 2 subparag. 1 of the Housing Act (Article 104 subparag. 3), or “house,” with respect to property tax,” and the concept is inconsistent with “building,” under the Local Tax Act or the Restriction of Special Local Taxation Act. Therefore, in a case where the term “house,” other than “building,” is used under the individual provisions of the Local Tax Act or the Restriction of Special Local Taxation Act, the scope of the building included in “house,” should be interpreted differently in accordance with the purport and purpose of each provision (see Supreme Court Decision 2013Du13945, Nov. 28, 2013).

Meanwhile, the purpose of introducing the tax reduction or exemption provision of this case and its purpose is to alleviate the tax burden of taxpayers following the increase in the acquisition tax and registration tax base, such as the individual housing price and apartment housing price under the Act on the Public Announcement of Values and Appraisal of Real Estate (the statutory standard price of housing) due to the reorganization of real estate in 2005, which serve as the statutory standard price of housing, and to promote the activation of housing transactions. Therefore, the term “house” subject to the tax reduction or exemption provision should be deemed to refer to a building for people’s residence, and thus, if the newly acquired building cannot be deemed to be “house” as a residential building due to its considerable loss of the function as a residence, and thus, it cannot be deemed to constitute an acquisition tax reduction or exemption provision of this case. In addition, since the provision of this case applies only to a case where a person becomes a one house holder due to the acquisition of a new house or becomes a person who owns two houses temporarily due to the acquisition of a new house, it does not constitute acquisition tax reduction or exemption (see Supreme Court Decision 2005Nu275, 2015.).

(2) ( Address 3 omitted) Whether acquisition of 1/2 shares in a house is subject to reduction or exemption of acquisition tax under the instant reduction or exemption clause.

① First of all, we examine whether the Plaintiff constitutes “house” as a residential building when acquiring shares in 1/2 of the instant housing. The following facts revealed by the facts as seen earlier, namely, that the sales contract for each of the instant housing was concluded on July 16, 2012, the Plaintiff and three other parties obtained a construction permit for newly constructing collective housing on the ground ( Address 2 omitted), ( Address 3 omitted), and ( Address 4 omitted), and the Plaintiff et al. filed a report on the removal of each of the instant housing on September 7, 2012, and filed a commencement report on the commencement of construction on September 12, 2012; (3) the Plaintiff could not be seen as acquiring the said housing at the time of the said removal of the housing without any residential purpose, in light of the legal principles as seen earlier, the Plaintiff could not be seen as acquiring the housing at the time of the said removal of the housing without any residential purpose, or as removing the housing at the time of the said removal of the housing.

② Even if the Plaintiff’s acquisition of each of the instant houses constitutes “house” as a residential building, according to the facts acknowledged earlier, the Plaintiff owned ( Address 3 omitted) Ho-dong apartment house that was acquired on August 1, 2009 and ( Address 2 omitted) housing acquired on August 1, 2012 at the time of acquiring the 1/2 shares of the said housing. Since the Plaintiff possessed three or more houses due to the acquisition of the said ( Address 3 omitted), the date of removal of the said housing ( Address 2 omitted) at the time of the acquisition of the said housing ( Address 3 omitted), the acquisition of the said housing does not fall under the reduction and exemption of acquisition tax pursuant to the provision of the instant reduction and exemption.

(3) Sub-determination

The plaintiff's assertion is without merit, since the acquisition of 1/2 shares in a house does not constitute reduction or exemption of acquisition tax pursuant to the provision of reduction or exemption in this case, ( Address 3 omitted).

4. Conclusion

Since the instant disposition is lawful, the part against the defendant among the judgment of the first instance is revoked, and the plaintiff's claim corresponding to the revoked part is dismissed.

[Attachment]

Judges Ansan-chul (Presiding Justice)