The time when investment securities appraisal loss of an investment company is included in deductible expenses;

Where the equity ratio of an investment company is reduced as a result of the investment company's capital reduction for consideration, the date on which the investment company's loss in the appraisal of the investment securities has become final and conclusive shall be the time when the investment company sells all remaining stocks or the investment company is liquidated.

Article 40 of the Corporate Tax Act: Business Year for Imposing Profits and Losses

Article 49 of the Corporate Tax Act: Succession, etc. to Assets and Liabilities at the time of merger and division

1. Revocation of a judgment of the first instance;

2. The defendant's rejection disposition against the plaintiff on December 23, 2004 against the plaintiff shall be revoked.

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

1. Details of the disposition;

A. On July 19, 1995, ○○○○○○○○○○○○○○○ (hereinafter “○○○○○”) was established in New York, a local subsidiary, in the U.S., and ○○○○○○○○○○○ (hereinafter “○○○”). From February 28, 200 to December 18, 200, ○○○○ issued new shares more than four times during the period from February 28, 200 to December 18, 200. ○○○○ was a person specially related under the Corporate Tax Act (hereinafter “○○○○”) instead of giving up ○○○○’s offering of new shares upon the first offering of new shares, the ○○○○○○○ corporation (hereinafter “○○○○”) was involved in the acquisition of ○○○○○○○○○ (hereinafter “○○”) as a person specially related under the Corporate Tax Act.

B. ○○○ at the time of the settlement of accounts in 1999, evaluated KRW 2,731,618,00 of the acquisition value of KRW 90,040 of the shares in the account book of ○○○○○○ at the time of settlement of accounts, KRW 102,40,60,213 of the evaluation difference of KRW 2,00,60,603,155 under the Corporate Accounting Standards, as the evaluation profit account under the Act on Corporate Accounting Standards, and KRW 1,363,208,162 of the evaluation profit statement as the evaluation profit account under the Act on Corporate Accounting Standards, and the remaining KRW 748,795,206 of the evaluation profit in the account on the balance sheet as the reduction of capital in the account on the balance sheet, and KRW 102,40,213 of the said evaluation profit in the account on the balance sheet as a result of the tax adjustment thereon, and filed a tax base return for corporate tax by non-Inclusion.

C. On December 18, 200, 00, ○○○○○○ (hereinafter “○○”) sold KRW 2,106,720,00 on the condition that 117,040 out of 150,040 shares held by ○○○○○○○○ was redeemed within three years (hereinafter “the repurchase transaction in this case”). The amount of KRW 1,724,827,001 (hereinafter “the dispute amount”) out of the book value shortage as investment securities disposal loss, and the amount of KRW 1,724,827,00 (hereinafter “the dispute amount”) was included as investment securities disposal loss. On the other hand, with respect to the tax adjustment in the business year of 1999 as a result of the relevant equity assessment, the pertinent tax adjustment (the sales ratio of KRW 102,40,213 was realized, the pertinent sales ratio of KRW 79,882,406,00,000) was reserved in the calculation of earnings,306,386.

D. On July 1, 2001, the Plaintiff (which was the first ○○○, but was changed to its trade name as of August 29, 2003) merged ○○○ on July 1, 2001, and subsequently redeemed KRW 117,040 shares issued by ○○○○○ sold to ○○○○○○○ on October 31, 2001, at KRW 2,106,720,000, the initial selling price, at KRW 2,106,720,000, the initial selling price. In addition, on July 1, 2003, 200, ○○○○○○○○○○’s paid reduction was implemented, and 150,040 shares owned by the Plaintiff, and the Plaintiff acquired KRW 7,784,431,200,00.

E. On Nov. 1, 2004, the head of ○○○ Tax Office: (a) as a result of the tax investigation on ○○○○’s ○○○ ○○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○.

F. On July 1, 2003, the Plaintiff: (a) reduced 131,040 shares of 150,040 shares of 150,040 shares of ○○○○○○○○○○○○○, thereby reservation of evaluation profit of equity law; (b) reservation of investment securities disposal loss; (c) reservation of 1,063,438,687 shares; (d) reservation of 1,724,827,001 shares; (e) reservation of investment securities disposal loss; (d) reservation of 351,49 won; (e) reservation of 116,814,357 won; and (e) disposition of the amount of 2,943,064,674 won; and (e) disposition of the amount of 2,570,385,685,740 of the amount of corporate tax to be disposed of as deductible expenses; and (e) disposition of the Plaintiff’s tax adjustment claim to ○○○○○○○.

G. On March 23, 2005, the National Tax Tribunal filed a national tax appeal against the above rejection disposition, and on January 4, 2007, the amount equivalent to KRW 79,882,406, and KRW 1,063,438,687 of the reserve of △△△ in calculating the equity interest in the valuation of the investment securities invested by ○○, merged with the Plaintiff, as well as KRW 1,063,438,687, and the Plaintiff succeeded to the amount corresponding to the ratio of the capital reduction of the investment securities held by the Plaintiff (131,040/150,040) out of the succeeded amount, the tax base and tax amount of the corporate tax were corrected by earnings or inclusion in deductible expenses, and the remaining appeal was dismissed.

Facts without dispute over the basis of recognition, entry in Gap evidence 1, 3, each of Gap evidence 1, 2, 7, and 8

2. Whether the disposition is lawful;

A. The plaintiff's assertion

Even if a repurchase transaction in this case is deemed as a self-financial transaction, the substance of the transaction is merely a loan from the initial date of sale to the date of repurchase, and thus, the key issue amount is not a securities disposal loss, but a securities appraisal loss, and the non-deductible issue amount shall be deemed to have arrived at the year to which the deductible expenses are reverted at the time of capital reduction. Therefore, pursuant to Article 85 (1) 2 of the Enforcement Decree of the Corporate Tax Act, the key issue amount shall not be included in the gross income or deductible expenses of the extinguished corporation

(b) Related statutes;

It is as shown in the attached Form.

(c) Fact of recognition;

(1) On July 1, 2001, 00, ○○○ shares held more than 20% (150,040 shares out of 170,040 shares, 88.2%) prior to the merger with the Plaintiff, and assessed 150,040 shares out of ○○ shares out of 170,040 shares under corporate accounting standards as equity law.

(2) As a result of conducting a tax investigation with respect to ○○○○○○, the director of the regional tax office notified the head of the ○○○ Tax Office of the taxation data that the instant repurchase transaction constitutes a substantial loan of funds. Accordingly, the head of the ○○○ Tax Office notified the head of the ○○ Tax Office of the taxation data that the disposition of investment and securities disposition loss of ○○○○○○○○○○○○○○○○○ stocks should be reserved and disposed of as non-deductible losses. Accordingly, the head of the ○○ Tax Office made a decision to withhold and correct the tax base and tax amount by adding the total amount of KRW 2,708,383,282, which was reported in addition

(3) The Plaintiff should succeed to the amount of KRW 2,708,383,282, which was subject to the reservation disposition of the said gross income, to the Plaintiff, a merged corporation, as a tax adjustment. On July 3, 2003, the pertinent securities issuing corporation received a refund of 131,040 shares paid in return for the said amount. As such, the amount equivalent to the shares reduced out of the said amount should be reserved as deductible expenses, and the Defendant filed a request for correction of corporate tax on the ground that the said amount should be reserved as deductible expenses.

(4)The National Tax Tribunal has rendered a decision that ○○ initially reported the inclusion of deductible expenses in deductible expenses due to tax adjustment, 983,556,281 won that the Plaintiff succeeded to the taxable income, and that the key part of the amount reflected in deductible expenses due to accounting management, shall be dismissed.

Each entry of Gap evidence 12-1, 2, Eul evidence 1-1 through 10, Eul evidence 2-3, Eul evidence 4-1, 2, and 3

D. Determination

(1) According to the above facts and relevant Acts and subordinate statutes, although ○○ Tax Office's deductible expenses were excluded from the deductible expenses, the amount at issue may be included in the deductible expenses, and if it is deemed that the repurchase transaction in this case is an act of self-financial transaction, the amount at issue shall be deemed as losses arising from the appraisal of securities, not from the disposal of securities, and the date when the appraisal loss of securities becomes final and conclusive as deductible expenses, shall be deemed as the time of capital reduction for consideration. Therefore, since the amount at issue is the amount that is not included in the deductible expenses of ○○ because the year to which the deductible expenses were reverted at the time of the merger, it shall be deemed that it is reverted to deductible expenses for the

(2) As to this, the Defendant asserts that even if the key issue amount is succeeded to the Plaintiff, the time when the profit and loss falls under the ratio of shares reduced out of the key issue amount is not the market price of the instant capital reduction (as the disposal loss amount is transferred to the remaining shares, the value is transferred to the remaining shares) but the profit and loss is attributed to the Plaintiff when the Plaintiff sells all ○○ shares or liquidates ○○○ upon liquidation.

However, according to the evidence evidence No. 15, it can be acknowledged that the corporate accounting standards, which set forth the corporate accounting standards for investment securities subject to the equity law, and Paragraph 35 of Article 15 (Share Act) of the Corporate Accounting Standards, provide that "if the equity ratio of an investment company subject to the equity law is reduced as a result of the investment company's capital reduction for consideration, the difference between the amount received as consideration for equity reduction and the amount of equity change obtained by subtracting the equity amount of the investment company prior to the capital reduction for consideration from the equity amount of the investment company after the capital reduction for consideration shall be accounted as disposal profits and losses." However, there is no evidence to support that the plaintiff, as alleged by the defendant, sells all ○ stocks, which are investment company subject to the equity law, or the

3. Conclusion

Thus, the plaintiff's claim seeking the cancellation of the disposition of this case is justified, and the judgment of the court of first instance is unfair, and it is so decided as per Disposition to cancel the disposition of this case and cancel it.

Justices Doam-is-is-is-is-is-is-is-is-is-is-is-is

Dois-is-is-is-is-is-is-is-is-is-is-is-is-satis-is-is-is

Imprisis-is-is-is-is-is-is-is-is-is-is-is-is-is-is-am.