209du4623 Revocation of revocation of the imposition of development charges

Plaintiff, Ltd.

Law Firm Barun, Attorneys Lee Jin-jin et al.

The head of Seocho-gu Seoul Metropolitan Government

Litigation Performers, Kim Jong-hee et al.

Government Law Firm Corporation, Attorneys Park Si-si et al., Counsel for the plaintiff-appellant

Seoul High Court Decision 2006Nu356 Decided January 22, 2009

July 22, 2010

The judgment below is reversed, and the case is remanded to Seoul High Court.

The grounds of appeal are examined.

1. Article 10 (3) 5 of the former Enforcement Decree of the Restitution of Development Gains Act (wholly amended by Act No. 9045 of March 28, 2008) provides that "the actual purchase price shall be objectively recognized as a normal transaction price" in cases prescribed by Presidential Decree where the land price for the commencement of development charges can be calculated based on the actual purchase price, not the officially assessed individual land price, and "where prescribed by Presidential Decree," Article 9 (5) 1 of the former Enforcement Decree of the Restitution of Development Gains Act (wholly amended by Presidential Decree No. 19752 of December 15, 2006) concerning "where the purchase price is purchased before the commencement of the imposition, and such purchase price becomes the tax base for the acquisition tax or the registration tax."

In light of the contents of these regulations and the purport of the development charges system, in order to calculate the land price as of the starting point of the starting point based on the actual purchase price, the purchase price should not only be the tax base of the acquisition tax or registration tax, but also be objectively recognized as the normal transaction price that is not included in the development profit.

2. A. The reasoning of the lower judgment and the evidence duly examined by the lower court reveal the following: (a) The non-party corporation that transferred the instant housing construction project to the Plaintiff based on the following: (i) the contract takes effect when the preparation of a real estate sales contract for the entire land subject to the project is completed after obtaining the approval of the housing construction project plan with the landowner; and (ii) the contract takes effect when paying the down payment upon the completion of the preparation of the real estate sales contract for the entire land subject to the project; (iii) the Plaintiff paid the purchase price in connection with the approval of the housing construction project plan without specifying the period of payment of the down payment, and (iv) the Plaintiff paid the purchase price after obtaining the approval of the said project plan.

As above, the sales contract for the above land is subject to the approval of the housing construction project plan, and the purchase price is premised on the premise that the purchase price should be approved in accordance with the floor area ratio applied, and not only significantly exceeding the officially assessed individual land price as at the time of the commencement of the imposition but also exceeding the officially assessed individual land price as at the time of the completion of the imposition. If there are circumstances, there is a lot of room to view that the purchase price is a normal transaction price that is not

B. Thus, the court below should examine whether the above purchase price was purchased prior to the commencement date of the imposition and whether it constitutes the tax base for acquisition tax or registration tax, and whether it can be objectively recognized as the normal transaction price that is not included in the development gains, and examine whether it can be used as the land price as the starting date. However, the court below determined that the above purchase price should be used as the land price as the starting date without reaching it. In this regard, the court below erred by misapprehending the legal principles on the calculation of the land price as the starting date of the development charges, or by failing to exhaust all necessary deliberations. (On the other hand, the court below erred by misapprehending the legal principles on the calculation of land price as to the starting date of the development charges, or by failing to exhaust all necessary deliberations (the above purchase price is calculated as the starting date of the above purchase price, Article 10

12. Pursuant to Article 4-3(2) of the Ordinance of the Ministry of Construction and Transportation (amended by Ordinance No. 543 of the Ministry of Construction and Transportation), the land price as at the time of termination shall be calculated by the arithmetic mean of the values appraised by at least two appraisal corporations under the Act on the Publication of Land Prices and the Evaluation of Land, etc.

3. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Hong-hoon

Justices Kim Young-young

Justices Kim Gi-hwan

Justices Min Il-young