Evaluation of the non-title trust donation shares

The net profit and loss value per share can not be determined immediately as incidental to the net profit and loss value per share based on the net asset value. Therefore, the failure to examine the net profit and loss value per share is illegal, and it is subject to reversal and return.

Article 63 of the Inheritance Tax and Gift Tax Act: Appraisal of Securities

The judgment below is reversed, and the case is remanded to the Daegu High Court.

We examine the grounds of appeal.

1. Article 63(1)1 (c) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 5582 of Dec. 28, 1998) and Article 54(1) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 15971 of Dec. 31, 1998; hereinafter referred to as the "former Enforcement Decree") provide that the value of non-listed stocks per share shall be appraised by adding an arithmetic average of net asset value per share (net asset value of the relevant corporation ± total number of issued stocks ± the average rate determined by Ordinance of the Prime Minister in consideration of the average interest rate formed in financial markets) and net value per share. Article 55(1) of the former Enforcement Decree provides that the net asset value of the relevant corporation shall be the value calculated by subtracting liabilities from the appraised value of the relevant corporation as of the base date of appraisal; Article 58(2) proviso of the former Enforcement Decree shall not be included in the amount of income which is deemed impossible as of the base date of appraisal; Article 5819(2) of the former Enforcement Decree.

2. In assessing the value per share of the instant shares based on the supplementary evaluation method prescribed in Article 54(1) of the former Enforcement Decree, the court below acknowledged the facts as stated in its adopted evidence. The non-party 1 corporation's safe (hereinafter referred to as "non-party 1 corporation's safe") has, even before the date of title trust of the instant shares, counted an excessive amount of assets without reflecting a large amount of unrecoverable loan claim in the account book. The result of the actual inspection on the management status of the non-party 1 corporation's safe conducted within six months after the date of the above title trust, unlike the net asset value in the balance sheet of the non-party 1 was appropriated as 9.8 billion won at the time of the date of the instant title trust, the net asset value in the non-party 1 corporation's net asset value (this ratio was 14.4 billion won as of December 31, 198, the net asset value in which the non-party 1 corporation's net asset value was estimated to be more than 1.3 billion won.6 billion won.

3. Examining the reasoning of the judgment below in light of relevant Acts and subordinate statutes and the records, the judgment of the court below that the debt amount of the non-party credit cooperative at the time of title trust of the stocks of this case exceeds its asset and that the net asset value per share is incidental to its net asset value. Thus, there is no error of law such as misunderstanding of legal principles as to the evaluation

However, unlike the net asset value of the corporation as of the base date of appraisal, the net value of stocks is calculated by the weighted average amount of net profit and loss for the last three years in terms of corporate profit and loss in terms of corporate profit and loss, unlike the net asset value of the corporation as of the base date of appraisal, which is calculated by deducting liabilities from the net asset value of the corporation as of the base date of appraisal, and both are different elements and methods of assessment. Thus, it cannot be readily concluded that the net asset value per share as of the base date

Nevertheless, the court below did not conduct any deliberation on the weighted average amount of net profit and loss of the non-party credit cooperative for the last three years, and held that the value of net profit and loss per share of the non-party credit cooperative at the time of the title trust of this case constitutes the incidental (-) of the net asset value per share of the non-party credit cooperative at the time of the title trust of this case, and held that the value per share of the non-party credit cooperative of this case is "0 won" of the value of the non-party credit cooperative of this case shall be deemed to be an "0 won" of the value of the

4. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.