Whether the sale by means of the fund column for the telecom and bath business does not constitute real estate sales business;

In full view of the fact that the transaction of real estate has been conducted several times for a short period, it is reasonable to constitute real estate sales business, and the sole reason that the business feasibility of the real estate transaction was disposed of due to financial difficulties, etc. does not constitute grounds to deny the feasibility of the transaction.

Article 19 of the Income Tax Act / [Business Income]

Article 34 (Scope of Real Estate Sale Business)

1. All of the plaintiff's claims are dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

The imposition of each global income tax and value-added tax on January 10, 2006 by the Defendants against the Plaintiff shall be revoked.

1. Details of the disposition;

The following facts are not disputed between the parties, or are recognized in full view of the purport of each statement in Gap evidence 1, 2, 6-1, 2, 12-1 through 3, 5, 13, 3-3, 14-1 through 3, 4, 1-2-1 through 3, 2-3, 4, 4-1 through 3, 2-3, 4-1 through 4, 4-1 through 3, 4-5, and 5.

A. From August 25, 1993 to September 3, 2004, the Plaintiff acquired and transferred the real estate as shown in the details of the acquisition and transfer of the attached Table 2. Among them, the Plaintiff scheduled the transfer income tax on the transfer margin of each of the instant real estate (Dispute ① real estate ① real estate, ② real estate ② real estate ② real estate’s ○○○○mur, and ③ real estate’s ○○murland) acquired and transferred during the period from October 16, 200 to September 3, 2004.

B. The Defendants issued a notice of correction and correction of the total global income tax amounting to KRW 984,245,180,279,650 on January 10, 2006 on the ground that the transfer of each of the instant real estate by the Plaintiff constitutes a supply of goods subject to taxation under the Value-Added Tax Act as part of real estate sales business, and that the transfer margin constitutes business income subject to taxation under the Income Tax Act. The Defendants issued a notice of correction and correction of the total global income tax amounting to KRW 984,245,180 and value-added tax amounting to KRW 704,279,650 (hereinafter “each of the instant dispositions”). On April 4, 2006, the Plaintiff dissatisfied with this, filed an objection with the Defendant on August 2, 2006 with the National Tax Tribunal, but the National Tax Tribunal dismissed this on May 21, 2007.

2. Whether each of the dispositions of this case is legitimate

A. The plaintiff's assertion

The Plaintiff asserts to the effect that it is unlawful for the Defendants to regard the transfer of the instant case as real estate sales business and to take each of the instant dispositions, even though the Plaintiff acquired each of the instant real estate to conduct the telecoming and bathing business, and the business was no longer good, or the bill issued at the time of making soup was defaulted, etc.

(b) Related statutes;

Omission

C. Determination

According to Article 19(1)12 of the Income Tax Act, Article 34 of the Enforcement Decree of the same Act, Article 1 of the Value-Added Tax Act, and Articles 1 and 2 of the Enforcement Decree of the same Act, income generated from real estate sales business shall be subject to income tax, and real estate sales business shall be subject to value-added tax. Whether a certain real estate transaction constitutes real estate sales business, which is a requirement for taxation of business income and value-added tax, shall be determined according to social norms, considering the transferor’s acquisition and holding of real estate, creation, creation, size of transfer, frequency and mode of transfer, and continuity and repetition of business activities to the extent that it can be seen as profit-making activities, and the determination shall take into account not only the relevant transferred real estate, but also the overall real estate possessed by the transferor, before and after the time the relevant transfer took place (see, e.g., Supreme Court Decisions 93Nu1752, Sept. 9, 194; 2014Du4529, Apr. 29, 2019).

In light of the above legal principles, as seen in the facts of recognition, the Plaintiff acquired each of the instant real estate and transferred it over 3 months to 204 times for a short period of time, and only 1 year for the long time. The Plaintiff’s transfer of each of the instant real estate before and after August 1993 to September 2004, acquired the land, apartment, and housing in addition to the instant real estate, and transferred it over 14 times for about 14 occasions during the period from 1993 to 2004, and the Plaintiff acquired real estate during the said period and sold it over 1 to 3 years for most, and in particular, from 203 to 204, real estate transactions were conducted several times for a very short period of time, including transfer of real estate over 4 occasions, and thus, it cannot be seen that the Plaintiff’s management of the instant real estate was made for a continuous and repeated purpose of real estate transactions, and thus, the Plaintiff’s assertion that such transactions do not constitute a real estate trading business or its neighboring circumstances.

3. Conclusion

Therefore, each of the dispositions of this case is legitimate, and the plaintiff's claim of this case is dismissed as it is without merit. It is so decided as per Disposition.