Whether gift tax imposed pursuant to Article 34-6 of the Inheritance Tax Act falls under the national tax and additional dues imposed on the selling property under Article 35 (1) 3 of the Framework Act on National Taxes, and takes precedence over mortgage claims (negative)

National taxes and additional dues imposed on property sold, which takes precedence over claims secured by the right to collateral security established prior to the statutory due date under the Framework Act on National Taxes, shall be national taxes and additional dues imposed on the property for which the right to collateral security is established. The gift tax imposed pursuant to the provisions of the Inheritance Tax Act is presumed to have been donated to the property for which the right to collateral security was established, and thus, it cannot be deemed national taxes and additional dues imposed on the property for which the right to collateral security was acquired. Therefore, it shall

Article 35 (1) 3 of the Framework Act on National Taxes, Article 18 (1) of the Enforcement Decree of the Framework Act on National Taxes, Article 34-6 of the Inheritance Tax Act.

Supreme Court Decision 88Da105 Decided October 8, 1991 (Gong1991, 2670), Supreme Court Decision 93Da49581 Decided March 22, 1994 (Gong1994Sang, 1313), Supreme Court Decision 94Da11835 Decided April 7, 1995 (Gong195Sang, 1817)

Korea Long-Term Credit Bank (Attorney Kim Dong-sung et al., Counsel for the defendant-appellant)

Korea

Seoul High Court Decision 95Na10497 delivered on September 27, 1995

The appeal is dismissed. The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

Under Article 35(1) of the Framework Act on National Taxes, national taxes, additional dues, or disposition fees for arrears shall be collected in preference to other public imposts or other claims: Provided, That with respect to the sale of property on which a mortgage has been established prior to the statutory due date as referred to in each item of subparagraph 3, if national taxes, additional dues, or disposition fees for arrears other than the national taxes and additional dues imposed on the property on which the property is sold is collected from proceeds from the sale, this shall not apply to claims secured by the mortgage. The Inheritance Tax Act provides that "in cases prescribed by the Presidential Decree where it is difficult to recognize that the property was acquired with financial ability due to its occupation, gender, income, property status, etc., it shall be presumed that the purchaser of the property has received a donation from another person." Thus, the national taxes and additional dues imposed on the property on which the property is sold shall be imposed on the property on which the right to collateral security has been established, which shall not be considered as national taxes, additional dues imposed on the property itself under the Framework Act on National Taxes.

The court below presumed that the defendant received the acquisition fund of the real estate of this case from the non-party 1 based on the above provisions of the Inheritance Tax Act and assessed on the non-party 1 as the gift tax of this case is not national tax imposed on the real estate of this case, which is the object of auction. Thus, the plaintiff's claim against the non-party 1 against the non-party 1 is secured by the right to collateral security established on the real estate of this case before the gift tax of this case is imposed on the non-party 1 by the defendant. In light of the records, the court below's decision is just and it is not erroneous in the misapprehension of legal principles, such as

Therefore, the appeal is dismissed and all costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Don-hee (Presiding Justice)