The case reversing a building's appurtenant land for non-business use of the corporation without examining whether the building area directly used by the corporation among the buildings of the corporation.

According to Article 142 (1) 1 (e) of the Enforcement Decree of the Local Tax Act and Article 75-2 (6) of the Enforcement Rule of the same Act, if the area of a building directly used by the corporation is less than 1/2 of the total floor area of the building, the land equivalent to the ratio of the area to be used to the building area among the land annexed to the building concerned and the land equivalent to the ratio of the area to be used to the building area among the land annexed to the building in question is not a non-business land of the corporation, so in order to verify whether the corporation which leased part of the building in question has owned the land for non-business use since 10.10.10, the above corporation should have deliberated on the number of buildings directly used by the corporation during the above period. Thus, it is unlawful to determine that the above land is a non-business land of the corporation without examining the number of buildings directly used by the corporation.

Article 188 of the Local Tax Act, Articles 141 and 142 of the Enforcement Decree of the Local Tax Act, Article 75-2 of the Enforcement Rule of the Local Tax Act

Dongyang Industrial Co., Ltd. (Attorney Shin Chang-dong, Counsel for defendant-appellant)

[Defendant-Appellant-Appellee] The same legal representative

Seoul High Court Decision 82Gu1059 delivered on July 10, 1984

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

The grounds of appeal are examined.

(1) According to the reasoning of the judgment below, the court below recognized the fact that the part of the building directly used by the plaintiff among the 7,475.5 of the building on the ground of 32,496 square meters on the land of this case at the original land owned by the plaintiff was 3,517.12 square meters (47.04%) in the case of 1980 and 3,331.56 square meters in the case of 1981 (4.6%) in the case of 1981. The court below was just in light of the records, and there was no violation of the rules of evidence such as the theory of lawsuit.

(2) The lower court affirmed the Defendant’s taxation by applying Article 188(1)1 subparag. 3 of the Local Tax Act, on the ground that it is evident that the Plaintiff had leased part of the building on the land to Nonparty Dongyang Industrial Co., Ltd. since October 1975, on the premise that the Plaintiff owned the said land for non-business purpose until April 16, 1980 and May 11, 1981, on the premise that the date of commencing the payment of property tax until September 16, 1980, the date of commencing the payment of property tax until the date of commencing the payment of property tax in 1981, deeming that the Plaintiff owned the said land as non-business land for more than three years and more than five years (70/100 and more than five years) and more than five years (70/100/80/100).

However, the calculation of the period of holding land for non-business use of a corporation shall be calculated from the time when the land in question falls under the first time for non-business use of a corporation (see Article 188 (1) 1 Item 3 of the Local Tax Act, Article 141 of the Enforcement Decree of the same Act). In a case where the area of a building directly used by the corporation is not less than 1/2 of the total area of the building, land equivalent to the ratio of the area used to the building area among the land in question shall not be deemed land for non-business use of a corporation (see Article 142 (1) 1 Item 7 of the Enforcement Decree of the Local Tax Act, Article 75-2 subparagraph 6 of the Enforcement Rule of the same Act). Since the plaintiff corporation which leased part of the building in question to different from the land in question for non-business use of a corporation, it is necessary to examine whether the land in question exists for non-business use of the building in order to determine whether the land in question exists, not for non-business use of the building in question.

(3) Therefore, the lower judgment is reversed, and the case is remanded to the Seoul High Court. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Gangseo-young (Presiding Justice)