The burden of proving that a contract is entered into with an amount different from the estimated contract amount reported in accordance with Article 21-7 of the Act on the Utilization and Management of the National Territory.

In accordance with the provision of Article 21-7 of the Act on the Utilization and Management of the National Territory, when the party who reported the land transaction contract without any change, the contract shall be presumed to have been concluded in accordance with the reported content unless there are special circumstances, such as the fact that the contract amount was erroneously stated at the time of the report, or that there was an inevitable reason to state the amount differently from the agreed amount, or that there was a need to newly determine the price between the transaction date and the actual transaction date due to the price fluctuation, etc.

Article 21-7 of the Act on the Utilization and Management of the National Territory, Article 23 (2) of the Income Tax Act, Article 26 of the Administrative Litigation Act (Article 26)

Supreme Court Decision 90Nu1151 delivered on October 16, 1990 (Gong1990, 2322) 89Nu7092 delivered on November 13, 1991 (Gong191, 116)

[Defendant-Appellee] Plaintiff 1 et al., Counsel for defendant-appellee

head of Dongjak-gu Tax Office

Seoul High Court Decision 89Gu10953 delivered on November 23, 1990

All appeals are dismissed.

The costs of appeal shall be assessed against each party.

(1) We examine the Plaintiff’s grounds of appeal.

In full view of the provisions of Articles 1, 21-7(1) and (2), 28-8(1), 28-8(3), 21-14 subparag. 1 and (3), 33 subparag. 4, and 33-2 of the Enforcement Decree of the Act, and Article 11(3) of the Enforcement Decree of the Act on the Utilization and Management of the National Territory, the land reporting system under the Act on the Utilization and Management of the National Territory is intended to adjust the contract amount and purpose based on the report, and to reduce the price and increase price of land through which the administrative agency adjusts the contract amount and effective prevention, and if the predetermined amount of contract reported by the parties to the transaction exceeds a certain amount of time, the administrative agency may recommend that the parties to the transaction should not report the predetermined amount of contract in accordance with the provisions of the Act on the Utilization and Management of the National Territory, and if the parties to the transaction who received the report do not report the predetermined amount of contract without any special reason to specify the predetermined amount of land price or otherwise specify the predetermined price.

The court below is just in rejecting the plaintiff's assertion that the contract amount under the contract agreement differs from the actual transfer value on the ground that there is no proof of assertion as to the above special circumstances, and there is no error in the violation of the evidence law or the exercise of right to explanation, such as the theory of lawsuit, and there is no error in the violation of the rules concerning the calculation of transfer margin. All arguments are without merit.

(2) We examine the Defendant’s grounds of appeal.

The fact-finding by the court below as to the theory of lawsuit is justified.

According to the records, the defendant litigation performer voluntarily stated that the acquisition and transfer of land 15 to 17 is an speculative transaction falling under Article 72 (3) 8 of the Regulations on the Management of Property Tax and thus the transfer margin is calculated. The judgment of the court below is not erroneous in the incomplete hearing, and it is without merit.

(3) Therefore, all appeals are dismissed, and the costs of appeal are assessed against each losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Jae-sung (Presiding Justice)