All appeals are dismissed.

Costs of appeal shall be borne by each party.

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

1. Judgment on the plaintiffs' grounds of appeal

A. As to the ground of appeal No. 1, Article 41-5(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 7010, Dec. 30, 2003; hereinafter “former Inheritance Tax Act”) provides, “Where a person having a special relationship with the largest shareholder, etc. has received stocks, etc. of the relevant corporation from the largest shareholder, etc. or has acquired stocks, etc. of another corporation from the person other than the largest shareholder, etc. who received stocks, etc. of the relevant corporation, etc. or acquired stocks, etc. of the relevant corporation with a special relationship with the relevant corporation or another corporation within 3 years from the date of donation of the relevant stocks, etc., where the value increases as a result of the merger with the relevant corporation or the stock-listed corporation or the Association-registered corporation having a special relationship with the relevant corporation, if a person who received

(4) Article 2(2) of the former Inheritance and Gift Tax Act provides that “No gift tax shall be levied on donated property when the income tax under the Income Tax Act is levied on the donee,” and Article 2(2) of the former Inheritance and Gift Tax Act provides that “in this case, the same shall apply where the income tax is non-taxable or reduced under the Income Tax Act, etc.” is newly established as the proviso was amended by Act No. 7010 on December 30, 2003.

On the other hand, the former Income Tax Act was amended by Act No. 8144 on December 30, 2006.