Seoul High Court 2009Nu28584 (27 April 2010)

Examination Transfer 208-0261 ( December 23, 2008)

Whether temporary suspension can be deemed to be temporary suspension where cultivation is suspended after the basic investigation of obstacles is commenced.

Even if the cultivation of the land was suspended after the commencement of the basic survey on the land and obstacles caused by the development project, such reasons alone cannot be deemed as temporary suspension of land, and thus, it cannot be deemed as farmland as of the date of transfer.

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

The appeal is dismissed.

The costs of appeal are assessed against the Plaintiff.

The grounds of appeal are examined.

The lower court, as indicated in its reasoning, determined that the instant land does not constitute a self-employed land subject to reduction or exemption of capital gains tax under Article 69 of the former Restriction of Special Taxation Act (amended by Act No. 9276 of Dec. 29, 2008; hereinafter the same) on the ground that, in light of the details of compensation for obstacles to the instant land and the current status of the instant land indicated in the aerial photography, it is insufficient to recognize that the instant land was actually being used for cultivation at the time of transfer or was temporarily in a state of temporary suspension, and that even if the Plaintiff suspended the cultivation of the instant land after the basic investigation of the land and obstacles caused by the development project as indicated in its holding, as alleged by the Plaintiff, could not be deemed to have been in a state of temporary suspension, on the ground that the instant land cannot be deemed to have been in a state of temporary suspension. Examining the relevant legal principles and records,

On the other hand, the argument in the grounds of appeal that capital gains tax should be reduced or exempted for the income accrued during the period in which the land was farmland pursuant to the proviso of Article 69 of the former Restriction of Special Taxation Act is first raised in the final appeal, and it cannot be a legitimate

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