Changwon District Court-2014-Gu Partnership-1640 (No. 19, 2015)

It is difficult to recognize the fact that a local public official has cultivated a forest directly because he was a local public official.

It is difficult to recognize the fact that a person directly cultivates a forest by neglecting the area of an orchard owned including a local public official and the area of which is at least 50,000 square meters. As long as the value of trees is calculated and sold separately according to a special agreement in a sales contract, the disposition including the value of the land is illegal.

Article 69 of the Restriction of Special Taxation Act (Reduction or Exemption of Transfer Income Tax for Self-Cultivating Farmland)

2015Nu10783 Revocation of Disposition of Imposing capital gains tax

Appellant-Appellants

Doz. Doz.

Appellant-Appellant

○ Head of tax office

Changwon District Court Decision 2014Guhap1640 Decided May 19, 2015

2016.27

2016.05.25

1. The plaintiff's appeal and the defendant's appeal are all dismissed.

2. The costs of appeal shall be borne by each party.

1. Purport of claim

The Defendant’s imposition of KRW 00,000,000 for the transfer income tax belonging to the year 2012, June 1, 2013 against the Plaintiff and KRW 00,000,00 for the transfer income tax belonging to the year 2012, Sept. 1, 2013 shall be revoked.

2. Purport of appeal

Of the judgment of the court of first instance, the part against the plaintiff shall be revoked. The imposition of capital gains tax of KRW 000,000,000 against the plaintiff on June 1, 2013 by the defendant shall be revoked.

The judgment of the court of first instance is revoked. The plaintiff's claim corresponding to the cancellation part shall be dismissed.

1. Details of the disposition;

A. On September 24, 1972, the Plaintiff was appointed as a local public official for Kimhae-si and retired on July 30, 2007, when he worked in a Myeon office, etc. 】 from January 5, 1973 to June 22, 1995 】 and thereafter retired from office on July 30, 2007 】 】 the Kimhae-si 】 the president of the Corporation 】 retired from office in 2009.

B. On October 13, 1978, the Plaintiff acquired the ownership of the farmland of this case (hereinafter referred to as “each forest of this case”) by dividing it into several occasions x 27,570 square meters (hereinafter referred to as “the forest of this case”) of the ○○○○-○○-○, forest of this case 】 8,668 square meters in each forest of this case (hereinafter referred to as “the forest of this case”). From that time, the Plaintiff planted trees in each forest of this case (hereinafter referred to as “the forest of this case”).

C. On June 8, 2012, the Plaintiff sold each forest of this case to a corporation (hereinafter referred to as the “corporation at issue”) at issue, and was paid the sales price in full by September 13, 2012.

D. On November 30, 2012, the Plaintiff calculated the transfer value of each of the instant forests as KRW 0,000,000,000, capital gains tax amounting to KRW 0,000,000,000, and the calculated tax amount to KRW 00,000,000, and paid KRW 00,000,000, by applying Article 69 of the Restriction of Special Taxation Act and Article 66 of the Enforcement Decree of the Restriction of Special Taxation Act to the reduced or exempted tax amount for farmland for a year of eight years or more as stipulated in Article 66 of the Enforcement Decree of the Restriction of Special Taxation Act.

E. However, on June 1, 2013, the Defendant issued a correction and notification of the capital gains tax of 00,000,000 (including additional tax) for the transfer income tax of 2012 to the Plaintiff (hereinafter referred to as “instant first disposition”) on the ground that “the Plaintiff was confirmed to have cultivated the instant pine trees using his family members and figures with the fact that he had been employed as a public official in Kimhae-si, and the Plaintiff does not seem to have done so for not less than 8 years directly in each forest of this case.” Moreover, on September 1, 2013, the Defendant rendered a correction and notification to the Plaintiff on the ground that “the Plaintiff arbitrarily calculated the tax amount of KRW 0,00,000,000 in total on the transaction value on the real estate register of each forest of this case, while transferring each forest of this case, and then deducted it from the transfer value, each of the instant disposition of KRW 200,000,000,000 from the transfer value.”

F. On December 2, 2013, the Plaintiff filed an appeal with the Tax Tribunal on the instant disposition No. 1 on August 28, 2013, and filed an appeal with the Tax Tribunal on the instant disposition No. 2 on November 26, 2013, and filed an appeal with the Tax Tribunal on March 7, 2014. The Tax Tribunal rendered a ruling to dismiss the Plaintiff’s appeal on May 14, 2014 by combining the two appeals.

[Ground of recognition] Facts without dispute, Gap evidence 1 through 4, 17, 18, Eul evidence 1 through 3 (including branch numbers; hereinafter the same shall apply), the purport of the whole pleadings

2. Whether each of the dispositions of this case is legitimate

A. Judgment on the first disposition of this case

1) Summary of the Plaintiff’s assertion

Between 1979 and 1986, since the number of the instant trees had to be put in compared to that of the Chinese trees, the time was less than that of the instant trees to be put in, and thus, it was possible to directly take advantage of the hours before and after the start-up of the night, and the weekend, and thereafter, to reduce working hours by using the method of outdoor sales, etc., even between the time when each of the instant forest land was sold at the place of the opening of the meeting, and thereafter, to reduce working hours. Since the president of the Kimhae-si Facilities Management Corporation directly cultivated each of the instant forest land for not less than eight years, it was unlawful to take measures different from the above, as the instant forest land was directly cultivated for not less than eight years, referring to the farming company’s care in mind.

2) Relevant statutes

It is as shown in the attached Form.

3) Determination

A) Relevant legal principles

Article 69(1) of the former Restriction of Special Taxation Act (amended by Act No. 11614, Jan. 1, 2013) provides that “The tax amount equivalent to 100/100 of capital gains tax shall be reduced or exempted on income accruing from the transfer of land cultivated directly by a resident living in the farmland for at least eight years, as prescribed by Presidential Decree.” Article 66(13) of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 26070, Feb. 3, 2015) provides that “direct farming” means that “the resident engages in the cultivation of crops or perennial plants on his/her own land or cultivates or cultivates them with his/her own labor for at least 1/2 of the capital gains tax (see, e.g., Supreme Court Decision 2010Du9494, Sept. 29, 201).”

Article 66(13) of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 19329, Feb. 9, 2006) provides for the meaning of "direct cultivation" as above, since the Plaintiff interpreted "self-owned farmland" as "farmland under his own responsibility," the Plaintiff asserts that the above interpretation should also be applied to the Plaintiff who sells each forest land of this case around June 2012. However, in the past, it is difficult to accept the Plaintiff's assertion in addition to the above internal tax law's interpretation and enforcement standards.

(B) the facts of recognition and determination

(1) According to the results of the fact-finding conducted by the Administrator of the Rural Development Administration, the Administrator of the Rural Development Administration of the first instance court, and the Director of the Agricultural Technology Institute of Gyeongnam-do, the following circumstances are acknowledged, as shown in the Plaintiff’s above assertion, according to the following: (a) the descriptions of Gap evidence Nos. 4 through 14, 17, 19, and 28; (b) the images of Gap evidence Nos. 22 through 26; and (c) some testimonys of HaA and main witnesses of the first instance court; and (d) the fact-finding

(A) The Plaintiff graduated from the △△ High School in △△, the Plaintiff was appointed as the Local Agriculture and Forestry Working Group on September 24, 1972, and served as a public official in the occupational category until he retires on July 30, 2007. The Plaintiff’s personnel record card includes “an agriculture” as a side business, and the Plaintiff has the technology for the reduction of trees, such as earthing, etc.

(B) The Plaintiff: (a) from January 5, 1973, around 18, 1973, worked at △△△△△△△△△△△△△△△△; hereinafter “△△△△△△△△△△△”); (b) from December 15, 1978 to her office 】 Kimhae-si 】 (c) 】 (d) 】 (e) 】 (e) 】 (e) 】 (e) 】 (g) 】 345 km; and (e) 】 x (e) the distance between the relevant offices

(C) On June 12, 1978, the Plaintiff joined an agricultural cooperative 】 as a member of the agricultural cooperative 】 In the farmland ledger for the Plaintiff prepared from December 20, 1985, the Plaintiff stated that the Plaintiff owned an orchard of the above 】 (the lot number before it was divided into each of the instant forests and fields) of the past 】 26,333 square meters of the past 】 as a farmer.

(D) 】 The plaintiff prepared a confirmation letter that he directly cultivated a reduction of reduction of reduction of reduction of reduction of reduction of reduction of reduction of reduction in the first instance court, and the stateB made a testimony to the effect that the plaintiff directly cultivated a reduction of reduction of reduction of reduction of reduction of reduction in the first instance court.

(E) The Plaintiff purchased fertilizers, agricultural chemicals, and facility raw materials, etc. necessary for cultivating trees from agricultural cooperatives 】 (2004, and from 2008 to 2012). The Plaintiff has used tax-free oil while possessing a large number of agricultural machinery, such as purchasing agricultural track on November 14, 2007.

(f) The most exhaustr operating the agricultural machinery agency prepared a confirmation document stating that the Plaintiff purchased agricultural machinery, such as Trackers and citers, at its own agency; HA operating the livestock shed, that the Plaintiff purchased retirement expenses from 1992 to 2012; and each written confirmation document stating that the Plaintiff purchased agricultural chemicals equivalent to KRW 2.5 million each year from 1998 to 2012; and KimD et al. prepared a confirmation document stating that the Plaintiff purchased all of the reductions cultivated by the Plaintiff each year from 1989 to 2012.

(G) When a small amount of heat begins from 2-3 years after planting to 8 years after planting, it goes beyond the quarterly point of profit and loss. As such, it is somewhat less required to take steps such as harvest, transport and storage, sorting and packing until it becomes eight years of age.

(2) On the other hand, in light of the following circumstances, which can be acknowledged by comprehensively taking into account the evidence and the purport of the entire pleadings as seen earlier, it is insufficient to recognize that the Plaintiff was engaged in cultivating the instant trees in each forest of this case, or directly cultivating the instant forest by carrying out one-half or more of the farming work with its own labor, and there is no other evidence to acknowledge otherwise. Thus, the Plaintiff’s above assertion is without merit.

(A) Considering that the entire area of the orchard owned by the Plaintiff, including each of the instant forests, was 52,797 square meters, and that the Plaintiff was a public official, etc. (the Plaintiff stated in this court that he was in office as a public official (the Plaintiff was in normal service from 9:0 p.m. to 6:00 p.m. as at the time of being in office as a public official x x 5:00 p.m. as at the time of being in office as the president) the Plaintiff voluntarily performed at least 1/2 or more of the entire orchard without

(B) The farmland ledger is only a document prepared for the management of farmland and the efficient implementation of agricultural policies, and cannot be deemed to have the effect of proving self-defense. In addition, the farmland ledger also exists where it has been prepared formally for the reduction of and exemption from various taxes, and it is not sufficient for administrative agencies to conduct substantial examination thereof. The farmland ledger against the Plaintiff states that the Plaintiff’s 10,054 square meters of oversource, in addition to the Plaintiff’s 52,797 square meters of orchard, shall be limited to the Plaintiff’s 10,054 square meters of farmland. Considering that the Plaintiff was a public official, it is difficult to deem that the Plaintiff’s 's 'self-cultivation of the said farmland ledger' is immediately deemed to mean a 'direct cultivation’ under Article 66(

(C) On March 20, 2013, the Plaintiff responded to the question of "after the tax investigation conducted on March 20, 2013, "after 2007, who served as a viewing public official for a long time x after retirement x how he/she served as the president of the Corporation x how he/she was in the office of the president of the Corporation?" "I have worked directly on the weekend when employing his/her wife and children while employing his/her wife and children during his/her family x they have worked directly on the weekend," and "I have responded to the question that "I have paid daily allowances in any form?" "I have written a fixed employment register (payment of KRW 2,00,000 for the father's 2 million per month) that directly lives around the transferred farmland on the old day, and currently (after retirement in 2007) has never removed the house of the employee department as a selling relation to the land and have tried the neighboring people to write the house."

(D) A short-term farmer is gradually increasing from three years of importations. When applying the agricultural utilization data (2007-2008) provided by the Rural Development Administration (2008) to the total orchard area owned by the Plaintiff, the Plaintiff’s three-year revenue from the above short-term farmer is KRW 6,50,000,000,000, and the total annual revenue from the above short-term farmer is KRW 23,000,000,000,000,000 for eight-years, and it is difficult to view that the Plaintiff did not completely harvest reduction during the eight-year period from 1979 to 1986. Therefore, as alleged by the Plaintiff, it is difficult to view that the annual working hours required for orchard farming for a period of eight-year period, 1,172 hours (the average working hours of the Plaintiff’s orchard calculated by excluding the time required for harvest, transport, storage, sorting, packing, etc., from the average working hours at work stage in 2013).

(E) Since the average working hours at the end of the year 2013 126.7 hours per 10a year, based on Dai wood, are 3,344 hours per 3,344 hours per year (=527.97a x 10a x 1/2, and less than a decimal point; hereinafter the same shall apply). Accordingly, from around 1986 when the instant pine trees were Dai, the average working hours at the end of the year 2013 4 hours per year (3,344/365 days per day) (the Plaintiff purchased the forest of this case from around 1986 by the method of pre-saleing the forest of this case). As such, the Plaintiff’s average working hours at the end of the year 2013 excluding the Plaintiff’s purchase of harvested trees at the end of the year 2013 / the average working hours at the end of the year 2013 / the average number of harvested and packing period during which the Plaintiff submitted.

(F) The purport of the former Restriction of Special Taxation Act stipulating the reduction of capital gains tax on self-arable farmland is to prevent speculation on non-owned farmland and to prevent the reduction of rural population by reducing the tax burden so that a person directly engaged in agriculture can engage in agriculture for a long time. Therefore, in order to recognize the "direct farming" under the above Act, it is necessary to have the direct input of more than 1/2 of the farmers and farmland in the place, time, and the direct input of more than 1/2 of the farmers themselves, and accordingly, it is reasonable to interpret that the farmland owner shall be excluded from the reduction of capital gains tax if he/she cultivates farmland on a intermittent basis by cultivating farmland using other people's labor, etc. while the farmland owner has a job other than agriculture.

B. Judgment on the second disposition of this case

1) Summary of the parties’ assertion

A) Summary of the Plaintiff’s assertion

The instant forest land was sold in KRW 0,000,000, and the instant tree was sold in KRW 300 million. However, in the course of a lump-sum sale of each forest land and the instant trees, the total sum of KRW 0,000,000,000 in the sales contract was entered in the sales contract for convenience, and the registration book was entered in the amount of transaction. Accordingly, the instant disposition was unlawful on the premise that each of the instant forest land was KRW 0,00,000,000, based on the premise that the sales price of each of the instant forest was KRW 0,000,000.

B) Summary of the Defendant’s assertion

A licensed real estate agent received brokerage fees calculated based on the sales amount of KRW 0,00,000,000 for each of the instant forests and fields in conformity with the instant depreciation trees, and the place of the sale of the farmland was in need of a factory site, which is not a depreciation tree, and purchased each of the instant forests and fields. The Plaintiff’s claim for the sales amount of pine trees is not calculated based on objective data, and this is not distinguishable from the sales amount of each of the instant forests and fields.

2) Relevant statutes

It is as shown in the attached Form.

3) Determination

A) As long as a disposal document is deemed to have been duly formed, the court shall recognize the existence and content of declaration of intent in accordance with the language and text stated in the disposal document, unless there is any clear and acceptable counter-proof that denies the content of the statement (see, e.g., Supreme Court Decision 2011Da105867, Apr. 26, 2012).

B) In light of the above legal principles, it is not sufficient to recognize that the sale price of each forest of this case is KRW 0,000,000 only with the health zone, Eul evidence Nos. 5 through 8, and Eul evidence No. 4, and there is no other evidence to acknowledge it (the defendant is not sufficient to recognize that the sale price of each forest of this case is KRW 1,400,000 per unit (1,400,000 per square meter) as indicated in the sales contract (1,400,000 per unit) prepared at the time of purchasing land adjacent to the forest of this case from the Mandong Association, Mandong Association (12). However, considering the above various circumstances and the video No. 36 as seen earlier, considering that the sale price of each forest of this case is 0,000,000 per unit of the forest of this case, the sale price of the forest of this case is 00,000,000 per unit of the forest of this case as alleged.

Rather, according to the following circumstances that can be recognized by comprehensively taking account of the entries in Gap 2, 3, 15, 16, and 20 evidence, testimony and the overall purport of the testimony and arguments by the witnesses of the first instance court, it is determined that the above KRW 0,00,00,00 is the aggregate of the purchase price of each forest of this case as calculated separately from the purchase price of each forest of this case. Therefore, the above Disposition 2 of this case on different premise is unlawful [the defendant is deemed to be part of the land without considering the National Tax Service’s execution standard of the capital gains tax (see, e.g., Supreme Court Decision 96-10, Jun. 6, 200; 206Du162-2, Sept. 1, 206). It is difficult to view that the above trees, other than those registered pursuant to the above Act, were subject to the transfer price of the forest of this case as part of the forest of this case (see, e.g., Supreme Court Decision 96-1)., the transfer price of the forest of this case.

(1) On June 8, 2012, the Plaintiff and the head of the Si/Gun/Gu have prepared an initial sales contract on the premise that the area of each forest of this case is 9,239 square meters. At that time, the Plaintiff and the head of the Si/Gun/Gu have prepared an initial sales contract on the premise that the area of each forest of this case is 9,239 square meters, and the 4.0."

(2) On June 18, 2012, the Plaintiff and the head of a Si/Gun/Gu have prepared a sales contract again in accordance with the increase in the area of access road site to be excluded from the sale subject to the sale. At that time, the sales contract was prepared with the same content as the above "4." and the detailed confirmation column of the broker also states that "the total purchase price of KRW 00,000,000 is KRW 00,000 among the total purchase price of KRW 0.0 billion."

(3) On June 18, 2012, the sales contract of June 18, 2012, was separately accompanied by the document of title “the number of main trees to be incorporated into the land, and the basis for calculation”. At all times, the Plaintiff stated the specific details that the value of the instant pine is calculated as KRW 00 million.

(4) At the first instance court, the Sung FF (Buyer) testified to the effect that “The Plaintiff and the senior executive director, EE, etc., gather and agree to pay KRW 00 million.” The Plaintiff’s written decision on the appeal filed by the Plaintiff, stating that “The EE, etc., of the place of real estate investment, included the value of the instant trees calculated separately in the purchase price of each forest of this case,” which is included in the statement to the effect that “The EE, etc., of the place of real estate investment, is included in the value of the instant trees calculated separately in the purchase price of each forest of this case.”

(5) On June 2, 2014, the real estate register of ○○○-○-○ Forest and 8,668 square meters (before registration conversion x x ○○-○○-○) was entered in the transaction amount.

3. Conclusion

Therefore, the plaintiff's claim for cancellation against the first disposition of this case is dismissed as it is without merit, and the claim for cancellation against the second disposition of this case is accepted as it is with merit. The first judgment is justified as it is in conclusion, and the plaintiff's appeal and the defendant's appeal are dismissed as it is without merit. It is so decided as per Disposition.