Daejeon High Court 2012Nu1899 ( October 10, 2013)

Cho Gyeong 201 Jeon 4835 ( December 27, 2011)

The provision excluding non-business land for the farmland owned at the time of this farming is applied only to the previous farming on December 31, 206.

The provision excluding non-business land for the farmland owned at the time of this farming is applicable only to those who were transferred to the farm before December 31, 206, and it does not constitute a violation of the principle of tax equality on the ground that the farmers who selected to continue to operate the farming in the farmland incorporated into the urban area without selecting the farmer, does not regard as being subject to reduction and exemption.

2013Du2921 The revocation of revocation of a request for capital gains tax rectification

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The Director of the National Tax Service

Daejeon High Court Decision 2012Nu1899 Decided January 10, 2013

June 27, 2013

The appeal is dismissed.

The costs of appeal are assessed against the Plaintiff.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Regarding ground of appeal No. 1

A. Article 104-3 (1) of the former Income Tax Act (amended by Act No. 8825 of Dec. 31, 2007; hereinafter the same applies) provides for "land falling under any one of the following subparagraphs as land for non-business use for the period prescribed by the Presidential Decree during the period for which the owner owns the relevant land, and provides for "land falling under any of the following subparagraphs" subparagraph 1 and "land falling under any of the following items" (hereafter referred to as "farmland" in this Article) and its (b) provides for "Special Metropolitan City, Metropolitan City (excluding Guns located in Metropolitan Cities; hereafter the same shall apply in this Article hereinafter in this Article) and Si area (excluding Eup/Myeon area in Do, rural complex form under Article 3 (4) of the Local Autonomy Act; hereafter the same shall apply in this subparagraph)" in accordance with the provisions of the National Land Planning and Utilization Act (excluding the area prescribed by the Presidential Decree; hereinafter referred to as "urban area") and the period of 10/30 of the former Income Tax Act (excluding the area referred to 10/4).

B. Article 122 of the Constitution provides that "The State may impose necessary restrictions and obligations with respect to land for efficient and balanced use, development and preservation as prescribed by the Act." Article 6 of the National Land Planning and Utilization Act provides that specific use areas shall be classified into "area requiring systematic development, maintenance, management and preservation, etc. of population and industry because it is concentrated or is anticipated to be concentrated," and in the case of farmland in urban areas, it may be subject to speculative transactions because there is a high possibility of increase in prices of land due to its characteristics, and it is not desirable in terms of balanced use and development of land, and it is necessary to prepare and dispose of the farmland within a certain period of time without any provision of Article 10 of the Income Tax Act (excluding the case of farmland for which the main sentence of Article 2 of the former Income Tax Act was amended by Act No. 737, Dec. 31, 2005).

2. As to the grounds of appeal Nos. 2 and 3

A. Article 104-3 (2) of the former Income Tax Act provides that "in applying the provisions of paragraph (1) to land for non-business due to inevitable reasons prescribed by the Presidential Decree, it shall not be deemed land for non-business use as prescribed by the Presidential Decree." Article 168-14 (3) 5 of the former Enforcement Decree of the Income Tax Act (amended by the Presidential Decree No. 20720, Feb. 29, 2008; hereinafter the same shall apply) and Article 83-5 (3) 2 of the former Enforcement Rule of the Income Tax Act (amended by the Ordinance of the Ministry of Strategy and Finance No. 15, Apr. 29, 2008; hereinafter the same shall apply) of the former Enforcement Rule of the Income Tax Act (hereinafter referred to as "the tax reduction provision of this case") shall not be deemed land for non-business use, and it shall not be deemed that it conforms to the principle of no taxation without the law or the principle of no taxation without the law.

B. According to the reasoning of the judgment below, the court below acknowledged the following facts: (a) while the plaintiff was living in the Odong-dong in the Odong-gu Seoul Metropolitan City from 1982 and engaged in the agricultural business on June 28, 2004, he continued to operate the agricultural business after being donated four parcels of land, including 000 to 665mm2 (hereinafter "the land in this case"), which are farmland in the urban area, from OOOOO on June 28, 2004, and transferred them to OOOOO on May 31, 2007; and (b) in light of the above legal principles, the court below did not err in the misapprehension of legal principles as to the reduction or exemption of the capital gains tax and the records on the land in this case for which the plaintiff did not continue to operate the agricultural business until December 31, 2006 without "the person who had been farming before December 31, 2006," and it did not err in the application of this case.

3. Conclusion

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.