Cho High Court Decision 201Do2600 ( November 30, 2011)

The amount paid by the mortgagee in addition to the dividend paid during the auction procedure shall also be included in the acquisition value.

In order to acquire bank loans, etc. in a substantial amount of the purchase price of land, it is reasonable to view that some bank liabilities are exempted from liability and that payment has been completed through dividends and final settlement on some bank obligations. Therefore, it is reasonable that a bank has paid additional settlement other than dividends that it received from the land auction procedure should also be included in acquisition value

2012Gudan6103 Revocation of Disposition of Imposing capital gains tax

IsaA

head of Sung Dong Tax Office

December 12, 2012

February 6, 2013

1. The Defendant’s imposition of capital gains tax of KRW 000 on January 11, 201 against the Plaintiff on January 11, 201 shall be revoked.

2. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order.

1. Details of disposition;

A. On January 24, 2005, the Plaintiff acquired land from CC by succeeding to the secured obligation of the land owned, and disposed of the land voluntarily on April 11, 2008 (amount of dividend).

B. On March 31, 2010, the Plaintiff received a notice of report after the due date of non-reported materials for the year 2008, and reported the transfer value as KRW 000,000, and KRW 000,000,000,000, and the Defendant denied the acquisition value and imposed KRW 000,000,000 for the transfer income tax for the year 2008 on January 11, 201.

C. In acquiring the instant land, the Plaintiff filed an objection to the purport that 000 won of the collateral security obligation established by D Bank and EE Savings Bank (hereinafter “Saving Bank”) was exempted from obligation, and thus, it should be recognized as acquisition value. The Defendant recognized only the sum of D Bank’s debt obligations, 000 won, which were distributed in the auction procedure of the instant land, and 000 won, which were paid by D Bank on May 4, 201, as acquisition value, and the remaining amount of tax due to the reduction of capital gains tax of 000 won was 00 won (hereinafter “the disposition of this case”).

D. The Plaintiff was under the procedure of the previous trial (e.g., filing of an objection) and filing a tax appeal.

[Grounds for Recognition] Unsured Facts, Gap evidence 1 to 11, evidence 14, and Eul evidence 1 to 1, and the purport of the whole pleadings

2. Whether the disposition is lawful;

A. Summary of the plaintiff's assertion

“The instant disposition is unlawful on the other premise that the Plaintiff’s acquisition price of the instant land includes 000 won of the D bank loans and 000 won of the Savings Bank loans that the Plaintiff agreed to succeed.

(b) recognised facts;

(1) The Plaintiff purchased the instant land from thisCC with a plan to develop the instant land, which is a stock farm site, in the same business with the SeoF.

(2) The instant land was in the state of setting up a security of a savings bank loan of KRW 000,000 in the name of thisCC, a total amount of a loan granted by the D bank under the name of thisCC, and EG (the first owner of the instant land; hereinafter the Plaintiff was the owner of the instant land), and the Plaintiff paid the purchase price by acquiring the entire amount of the D bank loans and KRW 000 out of the savings bank loans.

(3) Accordingly, the Plaintiff was exempted from liability for KRW 000,000, and the Savings Bank did not consent to the Plaintiff’s exemption from liability by separating the above KRW 00 million.

(4) When the auction procedure was in progress with respect to the instant land, the Savings Bank received 000 won in the auction procedure, and the remaining claims were recovered by receiving KRW 000 out of the total effective value of the expropriation of the land in the Dongjak-gu Seoul Metropolitan Government OE, including the wife H et al. of the GG.

(5) On September 2010, the Plaintiff and WesternF agreed to settle the remainder of the principal and interest at KRW 000, taking into account the amount of KRW 000,000, out of the savings bank loans the Plaintiff did not acquire, and then the Plaintiff paid KRW 000 to thisG through the SeoF, thereby making a final settlement of the purchase price of the instant land.

[Grounds for Recognition] The non-contentious facts, Gap evidence 15 to 20, witness Lee G's testimony, and the whole purport of the pleading

C. Determination

The acquisition value under Article 97 (1) 1 of the Income Tax Act refers to the actual transaction price required for the acquisition of assets, and according to the above facts, and the plaintiff is equivalent to the purchase price of the land in this case.

It is reasonable to view that the payment has been completed through dividends and final settlement on the debt exemption and savings bank loans of 000 won and savings bank loans, and that the savings bank has received dividends in the auction procedure of the land in this case and paid 000 won additional settlement in addition to 000 won, and that the disposition of this case by the defendant that judged differently from this is unlawful.

3. Conclusion

Since the disposition of this case should be revoked, the plaintiff's claim is accepted for reasons.