Cho High Court Decision 2008Do1968 (Law No. 26, 2008)

Whether land for non-business use is designated as a restricted area for forest acquisition;

Since "the prohibition of use due to the provisions of the law after the acquisition of the land" is clearly defined as "the land which is prohibited or restricted from the use pursuant to the law", there should be restrictions on the use of the land after the acquisition of the land for the purpose of becoming the land excluded from the idle land.

The contents of the decision shall be the same as attached.

Article 96 (Transfer Price)

Article 104-3 (Scope of Land for Non-business)

1. The plaintiff's claim is dismissed.

2. The costs of the lawsuit shall be borne by the plaintiff.

The Defendant’s disposition of imposition of KRW 162,886,470 on April 10, 2008 against the Plaintiff on April 22, 2008 (to be deemed as a clerical error in April 10, 2008) was revoked.

1. Circumstances of the disposition;

A. On December 2, 1993, the Plaintiff: (a) transferred the instant land to a third party on July 21, 2006; (b) deemed that the instant land was excluded from the idle land stipulated in Article 168-9 of the Enforcement Decree of the Income Tax Act; (c) calculated gains on transfer on the basis of the standard market price on August 18, 2006; and (d) reported and paid KRW 3,832,270 on August 18, 2006, by reporting and paying KRW 3,832,270.

B. After that, since the instant land is a non-business land stipulated in Article 104-3 (1) 2 of the Income Tax Act, it is reasonable to calculate gains on transfer on the basis of the actual transaction price. On April 10, 2008, the Defendant issued a disposition of this case imposing and notifying additional KRW 162,886,470 on the Plaintiff for the capital gains tax belonging to the year 2006.

[Evidence] Evidence Nos. 1, 3, Eul Nos. 1 to 3, and 5, and the purport of the whole pleadings

2. Whether the disposition is proper; and

A. The plaintiff's principal

Article 168-9 (1) 1 through 13 of the Enforcement Decree of the Income Tax Act, which provides for cases where land for non-business use is not deemed land for non-business use, and Article 168-14 (1) 1 and 2 of the Enforcement Decree of the Income Tax Act, and Article 83-5 (1) 1 through 11 of the Enforcement Decree of the Income Tax Act, shall be deemed as an exceptional listing provision not listed respectively, and the time when the plaintiff acquired the land of this case shall be more than December 31, 2005, where the transfer income tax and the provisions of the Act were newly established, which were 12 years before December 2, 1993, which were donated from the 13-year transfer date, and the defendant's disposal of the land of this case shall be deemed to have been carried out for 13 years or longer from the 194-year transfer date to the 10-year transfer date to the 14-year transfer date of this case's land for non-business use.

(b) Related statutes;

Article 96 (Transfer Price)

Article 104-3 (Scope of Land for Non-business)

C. Determination

In light of the principle of no taxation without the law, the interpretation of tax laws and regulations shall be interpreted in accordance with the law, barring any special circumstance, and it shall not be extensively interpreted or analogically interpreted without any justifiable reason. In particular, it is consistent with the principle of fair taxation (see, e.g., Supreme Court Decision 2002Du9537, Jan. 24, 2003). Thus, without a clear ground, Article 168-9 (1) 1 through 13 of the Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 19890, Feb. 28, 2007; hereinafter the same) and Article 168-14 (1) 1 and 2 of the Enforcement Decree of the Income Tax Act, and Article 83-11 through 16 of the Enforcement Decree of the Income Tax Act (amended by Ordinance of the Ministry of Finance and Economy No. 512, Jul. 5, 2006) that the land of this case is not subject to the Plaintiff’s provision for non-business purposes.

In addition, Article 104-3 (2) of the Income Tax Act (amended by Act No. 8825 of Dec. 31, 2007) and Article 168-14 (1) 1 of the Enforcement Decree of the Income Tax Act clearly stipulate that "the land prohibited from using due to the provisions of the law after acquiring the land, is "the land prohibited or restricted from using according to the law" and it cannot be viewed as a provision for the simple calculation of the period as alleged by the plaintiff. Thus, since the land of this case becomes a land excluded from the non-business land due to the above provisions, the plaintiff should have been subject to the restriction on the use of the land of this case after acquiring the land of this case. However, according to each entry in the evidence No. 2 and No. 8, considering the fact that the land of this case was designated as the restricted area for conversion from January 1, 199 to August 5, 207, the land of this case cannot be seen as not being subject to the restriction on use of the land of this case since it was acquired by the plaintiff from 193.

Therefore, the plaintiff's assertion that the land of this case is excluded from non-business land is without merit, and the disposition of this case on the premise that the land of this case is non-business land is legitimate.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.