National High Court Decision 2007west 4567 (Law No. 8.14, 2008)

Where the implementation of an urban environment improvement project is not authorized, capital gains tax shall not be calculated as the standard market price.

Special taxation provisions may apply only to the transfer of real estate to the owners of land, etc. who have obtained authorization to implement an urban environment improvement project, and where the owners of land, etc. have not obtained authorization for project implementation at the time of the transfer, the transfer income tax cannot be calculated based on the standard market

Article 85 of the Restriction of Special Taxation Act

Article 79-2 of the Enforcement Decree of the Restriction of Special Taxation Act, and Article 104-2

208Gudan14381 Disposition rejecting to correct capital gains tax

KimA

○ Head of tax office

June 13, 201

June 24, 2011

1. The plaintiff's claim is dismissed.

2. The plaintiff answers the costs of lawsuit.

The defendant's rejection disposition against the plaintiff on July 25, 2007 as to the transfer income tax of 374,301,200 won belonging to the year 2006 is revoked (it is apparent that "394,301,207 won" as stated in the purport of the complaint is a clerical error of "374,301,200 won").

1. Basic facts

(a) Details of the disposition;

(1) On October 31, 1990, the Plaintiff acquired 416-23 site, 6.9 square meters of the same 416-25 site, 118.7 square meters of the same 418-25 site, and 501.98 square meters of each of the above real estate (hereinafter referred to as "each of the above real estate") respectively. On June 27, 2005, the Plaintiff decided to sell the real estate to the non-party △△ Co., Ltd., Ltd., which succeeded to the buyer's status from the above company, and transferred each of the above real estate to the non-party △△△△ Co., Ltd., Ltd. (hereinafter referred to as "non-party 1") on December 7, 2006 by receiving full payment of the remaining proceeds of each of the above real estate.

(2) On February 3007, the Plaintiff reported and paid to the Defendant the transfer income tax amount of KRW 53,567,430 (tax base amount 1,679,313,085) calculated on the basis of the actual transaction price of each real estate of this case as the real estate of this case falls under the designated area under Article 104-2 of the Income Tax Act (hereinafter referred to as the "dumping area") upon the scheduled return and payment of the transfer income tax for the year 2006 following the transfer of each real estate of this case. On May 30, 207, the Plaintiff returned and paid the amount of KRW 53,567,430 (tax base amount 1,679,313,085) as the transfer income tax amount calculated on the basis of the actual transaction price of each real estate of this case, and on May 30, 2007, the Defendant paid the difference between the amount of the transfer income tax amount of KRW 159,266,30425

(3) On July 25, 2007, the Defendant rendered the instant disposition rejecting the Plaintiff’s claim for correction on the ground that the Nonparty Company, the transferee of each of the instant real estate, was not designated as a public project operator and was not subject to the provisions of the instant special taxation.

(b) Designation of an urban environmental improvement zone and authorization for project implementation;

(1) As of June 30, 2005, the ○○○○○○○○, where each of the instant real estate belongs, was designated as an speculation area. Meanwhile, the ○○○○○○, where each of the instant real estate was located, was designated as a balanced development facilitation district by a public notice of November 18, 2003, and was designated as a balanced development facilitation district by 2003-374. On March 13, 2006, public notice of ○○○ was designated as an urban environmental improvement district under Article 2006-87.

(2) The non-party company acquired each of the instant real estate, etc. to implement an urban environment improvement project within 001 zone, while formulating a plan to implement an urban environment improvement project for 001 zone, and was notified by the head of ○○○○○ on May 4, 2006 of measures to preserve cultural heritage in relation to an urban environment improvement project. On June 19, 2006, the non-party company received a conditional decision on traffic impact assessment from the traffic impact deliberation committee. On June 29, 2006, the non-party company was notified of prohibited acts and cancellation of facilities in the school environmental sanitation and cleanup zone by the office of education of ○○ City around June 29, 2006. On July 12, 2006, the non-party company was notified of the result of deliberation by the Construction Committee of ○○○ on June 30, 2006.

(3) After this, the non-party company filed an application with the head of ○○○○ on December 22, 2006 for authorization for the implementation of the urban environmental improvement zone for ○○1, which was after the date of settling the balance of each of the instant real estate, and the head of ○○○ on May 25, 2007 notified and notified the non-party company as the project implementer of the urban environmental improvement zone, which was the project implementer.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1, 2, 4, 6, 8, Eul evidence Nos. 1 through 4 (including each number), the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiff's assertion

The Plaintiff acquired each of the instant real estate from the time of acquisition stipulated in the special taxation provisions of this case before the designation date of the rearrangement zone, and transferred it to the non-party company, the urban environment rearrangement project implementer, on December 7, 2006, which was the time of transfer stipulated in the said special taxation provisions, before December 31, 2006, to the non-party company, the urban environment rearrangement project implementer. As such, in calculating the transfer income tax from the transfer of each of the instant real estate, the special taxation provisions of this case shall be applied, and the transfer income tax shall be calculated based on the standard market price. Thus, the instant disposition rejecting the Plaintiff’s request for correction is unlawful

① A project implementer under the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (hereinafter referred to as the "Urban Improvement Act") is a project implementer who actually performs an urban environment rearrangement project, etc. in a rearrangement zone in accordance with the procedure prescribed by the "Urban Improvement Act". Since the project implementation authorization under the "Urban Improvement Act" is an administrative disposition that generates the right to expropriate or use land, etc., even before obtaining the project implementation authorization, it is reasonable to deem the land owner as a project implementer under the "Urban Improvement Act" when the project implementation plan is prepared even before obtaining the project implementation authorization. A non-party company is deemed as a project implementer under the "Urban Improvement Act" in the "Urban Improvement Act" in the "Urban and Dwelling Conditions for Residents Act" in the "Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents" in the "Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents" in the "Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents" in the "Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents" in the "Act on May 16, 2007.

② In the urban environment rearrangement project implemented by the owners of lands, etc., the special taxation provision of this case may apply only to the transfer of real estate to the owners of lands, etc. who received the authorization for the implementation of the project, unless there are special circumstances such as being designated as the project implementer in advance. If the owners of lands, etc. did not obtain the authorization for the implementation of the project at the time of transfer, it is reasonable to interpret that the special taxation provision of this case cannot be applicable even if there is an ex post facto authorization for the implementation of the project. However, at the time of transfer of each real estate of this case, the non-party company has already received the notification of measures to preserve cultural heritage from the relevant administrative agencies, notification of conditional provisional decision on traffic impact assessment, notification of conditional decision on prohibited acts and cancellation of facilities, and notification of the result of deliberation by

B. Determination

(1) Relevant legal principles (Supreme Court Decision 2009Du14088 Decided May 26, 201)

Article 85 subparagraph 5 of the former Special Taxation Restriction Act (amended by Act No. 8146 of Dec. 30, 2006) and Article 79-2 (1) of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 19888 of Feb. 28, 2007) provide that the resident may calculate the acquisition value of real estate within the designated area under Article 104-2 (1) of the former Income Tax Act (amended by Act No. 8852 of Feb. 29, 2008; hereinafter the same shall apply) in calculating the standard market price in cases where the resident acquires the real estate within the designated area under Article 104-2 (1) of the former Special Taxation Restriction Act (amended by Act No. 8785 of Dec. 21, 2007; hereinafter referred to as the "Urban Improvement Act") before the designation date of the rearrangement area under Article 4 of the former Special Taxation Restriction Act.

Meanwhile, Article 8(3) and (4) of the Urban Improvement Act provides that an urban environment improvement project may be implemented by an association of owners of a plot of land, etc. or by owners of a plot of land, etc., and the Mayor and the head of a Gun may designate the owners of a plot of land, etc. as the project implementer if there are certain reasons to implement the improvement project, and Article 28(1) provides that the project implementer shall submit the project implementation plan, etc. to the head of a Si/Gun and obtain authorization for the implementation of the project, and Article 38 provides that the project implementer may expropriate or use the land, goods, or other rights if necessary to implement the improvement project. Article 85(7) of the Urban Improvement Act provides that a person who implements the improvement project without

The text and legislative intent of each provision, especially the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents, as the transferor recognizes the right to expropriate the real estate to the project implementer under the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents, the transfer value and acquisition value are bound to be restricted even if the transferor transfers the real estate to the project implementer. Therefore, the purpose of legislation of the tax special provisions in this case is to ease the transfer income tax and facilitate implementation of the rearrangement project at the same time, and at the same time, it is not possible to implement the rearrangement project without obtaining an authorization for project implementation under Article 28 of the Act. Where the owner of land, etc. wishes to become the project implementer, unless there are special circumstances, such as the designation of the project implementer under Article 8(4) of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents, it is difficult to specify the project implementer until the authorization for project implementation is granted, and it is difficult to view that the right to expropriate the land owner, etc. before and after the project implementation authorization is granted, and it is difficult to interpret the Act on the basis of the project implementation authorization.

(2) Specific determination

The Plaintiff’s assertion is inconsistent with the above relevant legal principles and cannot be accepted. The Plaintiff’s assertion is also difficult to adopt since there is a lack of legal grounds to deem that the Plaintiff’s claim based on the Plaintiff’s above, ① is without merit, and the instant disposition is lawful, since there is no ground to believe that the Plaintiff’s claim based on the Plaintiff’s assertion is legitimate, and the instant disposition is lawful, with the notification of measures to preserve cultural heritage, conditional decision on traffic impact assessment, notification of prohibited acts and cancellation of facilities within school environmental sanitation and cleanup zone, and notification of the result of construction deliberation.

3. Conclusion

Thus, the plaintiff's claim is dismissed as it is without merit.