early 2011west0971 ( December 16, 2011)

The date following the date when the grounds for issuing new shares accrue shall commence the evaluation period;

On the day when the cancellation of rights occurs from capital increase increase, the date preceding the date when the shareholder's preemptive right is extinguished in the case of the method of allocating shares, and the shareholder's preemptive right is extinguished on the date when the resolution was adopted by the board of directors, so the date following the date when the cause for capital increase occurred is the initial date

2012Revocation of revocation of disposition of imposing gift tax

Republic of Korea, Japan and one other

The Director of the Pacific District Office

September 7, 2012

October 19, 2012

1. The Defendant’s disposition of imposing gift tax of KRW 000,000 on the Plaintiffs on December 1, 2010, in excess of KRW 000, shall be dismissed.

2. The part exceeding 00 won out of 000 won for the imposition of gift tax as stated in paragraph (1) shall be revoked.

3. Of the litigation costs, 95% is assessed against the Plaintiff, and the remainder is assessed against the Defendant, respectively.

The Defendant’s disposition of imposing gift tax of KRW 000 on the Plaintiffs on December 1, 2010 is revoked.

1. Basic facts and circumstances of dispositions;

A. On April 18, 2005, Plaintiff U.S.A., Nonparty 5, KimCC, KimDD, KimE, westF, UG, H and Han II (hereinafter referred to as “the Plaintiff”) acquired 4,388,616 shares of the Plaintiff Company O (hereinafter referred to as “O”) owned by XX as indicated in the following table, and the total acquisition value is KRW 000.

Name

Date of acquisition

Quantity (State)

Equity ratio (%)

Amount (won)

forceB

April 18, 2005

455,000

2.99

00

CC Kim

455,000

2.99

00

D Kim D Kim

455,000

2.99

00

KimE

455,000

2.99

00

FF

256,250

1.69

00

United StatesA

455,000

2.99

00

GG

256,250

1.69

00

LH

256,250

1.69

00

IB

455,000

2.99

00

Total

.

3,498,750

23.01

00

B. From April 19, 2005 to September 26, 2005, the U.S.A and eight other parties acquired 590,866 shares of the O from April 19, 2005 to September 26, 2005, and on June 13, 2005, the Plaintiff U.S.A and KimE received 300,000 shares each for 150,000 won per share. Accordingly, the U.S.A and eight other parties acquired O shares of 4,389,616 shares from April 1, 2005 to September 26, 2005 (3,498,750 shares + additional acquisition 590,86 shares + 300,00 shares for 00,00 shares for O shares for 150,000 shares for O shares.

C. From April 18, 2005 to October 28, 2005, 4,214 shares of this case, 4,214 shares of this case, which were acquired in the name of the United StatesA and eight other shareholders, were sold inside and outside the country, and the price was 00 won in total.

D. The director of the Seoul Regional Tax Office, as a result of the integrated corporate tax investigation of YY Co., Ltd. (hereinafter referred to as YY), found that Y as a major shareholder of Y, and YJ acquired 4,389,616 shares of this case for the purpose of bypassing the Y. On June 13, 2005, J notified the director of the Gangnam District Tax Office, the head of the competent tax office, who is the head of the competent tax office, to impose capital gains tax on 00 won of OE shares acquired under the name of 8,000 shares. On June 13, 2005, J imposed capital gains tax on 150,00 shares (hereinafter referred to as 'stocks') under the name of YA, and imposed capital gains tax on 100 won on the Plaintiff, the trustee, pursuant to Article 45-2(1) of the Inheritance Tax and Gift Tax Act (hereinafter referred to as 'the Inheritance Tax and Gift Tax Act').

E. On December 11, 2006, the director of the Seoul Regional Tax Office filed a complaint with the Seoul Central District Public Prosecutor's Office on suspicion of violation of the Punishment of Tax Evaders Act that theJ evaded capital gains tax through the title trust of the instant shares. However, the Seoul Central Public Prosecutor's Office, not theJJ, judged this KK as the actual owner of the instant shares, and prosecuted this K on suspicion of violation of the Act on the Aggravated Punishment, etc. of Specific Crimes (Tax). Accordingly, the Seoul Central Public Prosecutor's Office convicted this K as the actual owner of the instant shares in the judgment of the criminal appellate court (Seoul High Court 2008No145).

F. As above, the Defendant revoked the initial disposition premised on the premise that the title truster of the instant shares was recognized as this KK, and the issue that was already transferred to another person is not subject to separate taxation, but subject to deemed donation of shares 48,756 shares remaining in the name of the Plaintiff UA on August 1, 2005 (hereinafter referred to as “stocks”) based on the shareholder registry as of August 1, 2005, the Defendant imposed KRW 00 of the gift tax on the Plaintiff UA and the title truster, the title trustee, the title trustee, on December 1, 2010 (hereinafter referred to as “instant disposition”).

G. The Defendant’s details of taxation are summarized as follows.

The previous disposition of this case

The Disposition of this case

Date of Disposition

February 15, 2007

December 1, 2010

donor

JJ

EK

Testamentary donee

United StatesA

United StatesA

Gifted articles

The shares of this case

The shares of this case

Date of donation;

June 13, 2005

August 1, 2005

Quantity

150,000 shares

48,756 Shares

Unit Price

00 won

00 won

Tax Base

00 won

00 won

calculated tax amount

00 won

00 won

Additional Tax on negligent tax returns

00 won

00 won

Additional Dues

00 won

00 won

Notice Tax Amount

00 won

00 won

H. The Plaintiff dissatisfied with the instant disposition and filed an appeal with the Tax Tribunal on March 7, 201, but the Tax Tribunal dismissed the Plaintiff’s claim on December 16, 201.

I. During the instant lawsuit pending, the Defendant recognized that the unit price of shares was not KRW 000,000, not KRW 000, and accordingly corrected the amount of gift tax by the instant disposition from KRW 000 to KRW 000.

[Reasons for Recognition] Unsatisfy, Gap evidence 1, 2, Eul evidence 1 to 3 (including paper numbers; hereinafter the same shall apply), 4 to 5, the purport of the whole pleadings

2. Whether the lawsuit regarding the reduced or corrected portion of the disposition in this case is legitimate

We examine the legality of the instant lawsuit ex officio. The rectification disposition is a disposition that has the favorable effect to the taxpayer, such as partial revocation of the amount of tax, and there is no benefit in the lawsuit seeking its revocation, and the subject matter of appeal litigation is the original disposition that remains not revoked by the decision of revocation of the amount of reduction in the original disposition, i.e., the reduced amount of tax. Of the instant lawsuit, there is no benefit in the lawsuit seeking its revocation, and there is no benefit in the lawsuit regarding KRW 000 of the amount of tax reduced in the instant disposition (hereinafter in this case, only the remaining portion of the instant disposition

3. Whether the instant disposition is lawful

A. The plaintiffs' assertion

The instant disposition is unlawful for the following reasons.

1) Key issue ② The actual owner of shares is not Plaintiff KK but Plaintiff UA, and the said shares are not subject to deemed donation of title trust.

2) The defendant calculated the provisional average amount from June 14, 2005 to August 3, 2005 the appraised value of shares. However, in the case of capital increase by issuing new stocks to a third party, the day following the resolution of the board of directors by the method of allocating new stocks shall be "the date of acquiring rights". Thus, the date following the resolution of the board of directors by the method of allocating new stocks to a third party is the initial date of June 10, 2005, and the date immediately preceding the date of August 3, 2005, which is the day immediately preceding the date of the resolution of the board of directors by the method of distributing new stocks in this case, and the period of appraisal as of August 3, 2005, when the capital increase was completed, the shares in this case were suspended from July 29, 2005 to the date of capital reduction. Therefore, the market price should be calculated based on the average market price during the remaining period excluding the above business suspension date.

3) In the initial disposition of this case, the Defendant: (a) considered the donor as the JJ; (b) imposed gift tax on the Plaintiff UA on June 15, 2007; and (c) the Plaintiff UA trusted it and paid in full the said gift tax on June 15, 2007. However, inasmuch as the Defendant voluntarily revoked the previous disposition on the ground that the previous disposition was erroneous, and imposed an increased additional tax through the instant disposition; (b) there is a justifiable reason that the Plaintiffs could not have been negligent in performing their tax liability; (c) accordingly, the amount of gift tax increased after the initial disposition of this

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Key issue (2) Whether the title truster of shares is Plaintiff KK or not

According to the purport of the entire pleadings in the statement in the evidence Nos. 3 through 5 of this case, it may be recognized that this part of the plaintiffs' assertion is without merit, as the actual owner of the shares in this case and as the actual owner of the shares in this case.

2) Relevant issue (2) Appropriateness of the market price of shares

A) According to the purport of the oral argument as to Gap's evidence Nos. 3, 4, and 6 through 8, the Association-registered corporation, determined capital increase by a third party's allocation method on June 9, 2005. The fact that the payment of capital increase was made on June 13, 2005 (hereinafter referred to as the "this case's capital increase"), theO passed a resolution to consolidate three common shares of OO with one share value per one share on April 20, 2005, and the sale and purchase was suspended on July 29, 2005 as of August 3, 2005 (hereinafter referred to as "capital increase"), and the defendant applied the Commercial Act (the date of this case's capital increase before the 205th day after the 205th day after the 20th day after the 205th day after the 3th day after the 205th day after the 20th day after the 205th day after the 205th day after the 20th day after the merger).

B) According to Articles 60(1) and 63(1)1 of the Inheritance Tax and Gift Tax Act, the market price of stocks of an Association-registered corporation shall be the average daily market price (the existence of transaction performance) of the Korea Stock Exchange every two months before and after the evaluation base date, and in cases where it is inappropriate to determine the average amount on a daily basis due to the occurrence of reasons such as capital increase or merger during the above period, the average of the periods calculated as prescribed by the Presidential Decree during two months before and after the evaluation base date shall be the market price. Article 52-2(3) of the Enforcement Decree of the Inheritance Tax and Gift Tax Act provides that the average market price during the period from the day after the evaluation base date to the day before and after the evaluation base date shall be the market price during the period from the day after the date when the same reason occurs to the day before and after the evaluation base date.

C) First of all, the date of the increase in the capital before the appraisal base date shall be deemed the date of the resolution of the board of directors, and the issue is whether it shall be deemed the date of the payment of the stock price. The date of the occurrence of the same cause before the appraisal base date under Article 52-2 subparagraph 3 of the Enforcement Decree of the Inheritance Tax and Gift Tax Act refers to the date of the cancellation of rights (see General Rule 63-02 of the Inheritance Tax and Gift Tax Act). Since the issue of new stocks due to the increase in the capital and merger occurs, and accordingly the transfer of rights and the subsequent share price are changed, it is necessary to assess the shares based on the value of the new stocks after the increase in the capital is made to reflect the impact of the increase in the capital on the formation of the next stock price. The date of the issuance of new stocks by a third party is the day before the date of the resolution of the board of directors where the preemptive rights of the shareholders are extinguished in the case of the issuance of new stocks by a third party, since the issuance of new stocks by a third party is the allocation method, the date.

D) Key issues: (2) With respect to the termination period of the stock price assessment period, whether or not to exclude the period after July 29, 2005, where the sale and purchase transaction was suspended as alleged by the plaintiffs, is problematic. (1) In addition, Article 63(1)1(a) of the Inheritance Tax and Gift Tax Act provides that the market price at this time shall be evaluated based on the average amount of the market price published before and after the appraisal base date; and (2) in the event of a cause such as a capital increase, etc. after the appraisal base date under Article 52-2(3) of the Enforcement Decree of the Inheritance Tax and Gift Tax Act, the portion affected by the stock price shall be excluded from the assessment period; and (3) since July 29, 2005, the suspension of the sale and purchase transaction from July 29, 2005 to submit the old stock price cannot be seen as a cause affecting the stock price; and (4) the above part of the Plaintiffs’ assertion that the above suspension period should not be justified.

E) Therefore, the calculation period of the average amount of the assessed market values of shares is from June 10, 2005 to August 2, 2005. Accordingly, the market values are KRW 000, as seen in the attached Table based on the calculation basis of the attached tax amount. The calculation of the reasonable tax amount is examined below.

3) Whether there exists a justifiable reason for additional tax

Under the Corporate Tax Act, an additional tax is a kind of administrative sanction imposed when a taxpayer corporation neglects its duty to return a tax base and pay the tax amount in good faith in order to ensure the propriety of taxation. Such a sanction is a kind of administrative sanction, which is imposed in cases where the taxpayer is liable for tax payment to fulfill his/her duty as a means of securing the obligation. Such a sanction is based on the foregoing purport of Article 48 of the Framework Act on National Taxes (see, e.g., Supreme Court Decision 2002Du666, Aug. 23, 2002).

In this case, the plaintiffs granted trust to the plaintiffs by making the initial disposition of this case without knowing the title truster's error, and thereafter changed the title truster, and thereafter made the disposition of this case again. due to the defendant's prior disposition, the plaintiffs asserted that there was a circumstance under which the plaintiffs could not expect the fulfillment of duty to pay taxes under the disposition of this case. <1> The initial disposition of this case and the disposition of this case are completely different from the original disposition of this case, and thus, the subject of trust formed with the plaintiffs is different from the original disposition of this case. <2> The plaintiff U.S.A filed a request for national tax review by denying the title trust itself as to the initial disposition of this case. Thus, it is difficult to view that there is any justifiable reason to exempt the plaintiffs from additional taxes, in light of the fact that there is no other reason to acknowledge any reason different from the dispute over disposition while disclosing the true title trust relationship. Accordingly,

(iv)the calculation of a reasonable amount of tax;

As seen earlier, in the event that the market price of shares is KRW 000, the amount of legitimate gift tax seems to be KRW 000, as seen in the “based basis for calculating the amount of tax” in the attached Form. Therefore, the portion exceeding the above amount of tax in the instant disposition is unlawful.

4. Conclusion

Therefore, the part of the plaintiffs' lawsuit of this case which exceeds the amount of tax reduced or corrected in the disposition of this case is unlawful, and it is reasonable to accept the part which exceeds the amount of tax amount of 00 won recognized by this court in the above disposition, and the remaining claim is dismissed as it is without merit. It is so decided as per Disposition.