Changwon District Court 2012Guhap127 ( November 26, 2013)

Since most of the source of acquiring funds and transfer proceeds of the real estate at issue belong to the Plaintiff, the original disposition that the Plaintiff deemed as the actual owner of the real estate at issue is legitimate.

The original disposition on which the Plaintiff imposed capital gains tax by determining the Plaintiff as the actual owner because it is confirmed that most of the transfer proceeds was used by the Plaintiff.

Article 14 of the Income Tax Act

(C)The revocation of the disposition imposing capital gains tax;

NewA

Kim Jong-soo

Changwon District Court Decision 2012Guhap1127 Decided November 26, 2013

March 6, 2015

April 10, 2015

1. The plaintiff's appeal and the conjunctive claim added in the trial are all dismissed.

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

The judgment of the first instance court shall be revoked. In the first instance court, the first instance court's decision shall be revoked. In the first instance court's decision is revoked. In the first instance court's decision, the imposition of additional OOOOOOOOOO on the capital gains tax accrued on May 2, 2007 that the Defendant rendered to the Plaintiff on January 14, 201 and the first instance court's decision on the capital gains tax accrued on the capital gains tax accrued on May 2, 2011 is revoked (the Plaintiff added the conjunctive claim in the first instance court).

1. Details of the disposition;

A. The Plaintiff purchased, under the name of OB, OO2,637 square meters (hereinafter “the instant real estate”) in the name of OB, O2,637 square meters in the name of OB, O2,00,000, and entrusted it to OB. Accordingly, this B purchased, from OCC, OO2,49, and 14 parcels out of the instant real estate from O2,000, out of O2,000, out of O2,000, from O2,000, to O2,000,000,000 won in its own name, and completed the registration of transfer of ownership on February 15, 2005. In addition, this B purchased from OO, Kim DD, the same land of 53 square meters among the instant real estate from O2,00,000 won in its own name, and completed the registration of transfer of ownership on the same land under the name of 15,05.38.1

B. On June 22, 2007, thisB entered into a sales contract with KimCC to sell the instant real estate to KimCC (hereinafter “instant sales contract”) and sold it.

C. On January 7, 2010, the Commissioner of the Busan Regional Tax Office decided and notified this B of the transfer income tax OOO on the ground that the BB purchased the instant real estate from KimCC, etc. and sold it to KimCC.

D. Around April 2, 2010, this B filed an objection with the Busan Regional Tax Office on April 2, 2010, but dismissed on April 28, 2010, the Plaintiff filed a petition for review with the National Tax Service on July 22, 2010, which was withdrawn on August 10, 2010, and filed a civil petition for grievance with the Anti-Corruption and Civil Rights Commission on December 27, 2010. The Anti-Corruption and Civil Rights Commission requested the Busan Regional Tax Office to conduct a reinvestigation of the disposition imposing capital gains tax on January 20, 201, and accordingly, the Busan Regional Tax Office reported that the Plaintiff constitutes the actual owner of the instant real estate and notified the Defendant of the taxation data.

E. On May 2, 2011, the Defendant decided and notified the Plaintiff on May 2, 201, that the transfer income tax of the instant real estate reverted to the year 2007, and the Plaintiff appealed and filed a request for examination with the National Tax Service on July 22, 201, but the National Tax Service dismissed the Plaintiff’s request for examination on January 26, 2012.

F. Meanwhile, on November 30, 2012, the Defendant revoked ex officio the imposition of penalty tax by OOOOO on May 2, 201 in order to specify the type of penalty tax on the said transfer income tax and the grounds for the calculation thereof. On January 14, 2013, the Defendant again imposed the penalty tax by OOOOO (limited to the principal tax other than the penalty tax on May 2, 201), and the imposition of penalty tax on the Plaintiff on January 14, 201 (hereinafter “instant disposition”).

[Ground of recognition] Facts without dispute, Gap evidence 26, Gap evidence 29-1, Eul evidence 1 through 4, Eul evidence 9, 15, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. Summary of the plaintiff's assertion

1) The instant disposition should be revoked on the grounds as follows (main claim).

A) Around February 2005, the Plaintiff purchased the instant real estate in the name of BB and trusted the instant real estate to B, without the Plaintiff’s consent, and the B sold the instant real estate at will without the Plaintiff’s consent, and as a result, the Plaintiff did not fully recover the instant real estate sales proceeds from the purchase of the instant real estate in its own name or investment in the fund in the name of himself/herself or his/her relatives. Accordingly, since the instant real estate sales proceeds did not belong to the Plaintiff, the Plaintiff does not constitute a taxpayer of capital gains tax on the instant real estate.

B) According to the result of the audit conducted by the director of Busan Regional Tax Office, the Defendant notified B of the transfer income tax amount from the transfer of the instant real estate on January 7, 2010, and the BB filed an objection on April 2, 2010, on April 5, 2010, the Plaintiff conducted a field investigation to impose transfer income tax on the Plaintiff as a party to the taxation disposition, and then rejected this BB’s objection. However, without any legal basis, the Defendant conducted a reinvestigation based on the re-audit request made on January 20, 201 by the Anti-Corruption and Civil Rights Commission without any legal basis, and determined the Plaintiff as a taxpayer for capital gains tax from the instant real estate and issued the instant disposition to the Plaintiff. This constitutes double

2) Even if the sale price of the instant real estate actually reverts to the Plaintiff, the portion imposed on the portion exceeding the amount returned to the Plaintiff out of the instant disposition, namely, the portion exceeding the amount of the OOOO origin, out of the imposition of capital gains tax accrued in May 2, 201, and the portion exceeding the amount of the additional tax imposed on capital gains tax accrued in the year 2007 as of January 14, 201, and the portion exceeding the amount of the OOO origin, out of the imposition of additional tax on capital gains tax accrued in January 14, 2013, should be revoked (preliminary claim).

B. Relevant statutes

It is as shown in the attached Form.

(c) Fact of recognition;

The following facts are either disputed between the parties, or acknowledged by Gap evidence 5-1, 2, 7-13, 31-4 and 16, and the whole purport of arguments as a result of the examination of the plaintiff by the court of first instance.

1) On May 5, 2004, the Plaintiff, who operated an adult amusement room, issued a warrant of arrest on charges of violating the Sound Records, Video Products and Game Software Act, etc., the Plaintiff started the escape life. The Plaintiff came to know of GoE, which was a former police official, during the escape life, and GoE was able to support the Plaintiff’s escape life by forging a driver’s license necessary for the Plaintiff’s escape life. The Plaintiff was aware of the above support and led to the escape life of GoE.

2) From November 2004, the Plaintiff: (a) delegated the management of the entertainment room that he/she had operated to E; (b) entrusted the management of his/her own property including FF, Co., Ltd., GGM, HH, etc.; (c) entrusted the entire shares of FF to E and its wife Kim II; (d) around December 2005, the Plaintiff opened a restaurant to E and requested E to help E start the restaurant business; (b) registered PE as a director of FF, GG metal’s representative director, HH’s auditor; and (c) registered PE Kim II as a director of the company; and (d) GoE received OO Won’s benefits from the Plaintiff to the representative director’s remuneration group.

3) When the Plaintiff came to know of the fact that the BB and the E had a bad faith relationship from September 2008, the Plaintiff filed a complaint with an investigative agency as a crime of adultery, and the BB and the E were indicted as a crime of adultery and convicted on July 20, 2010.

On May 25, 2009, the Plaintiff filed a divorce and a lawsuit for the division of property (BB) with the Busan District Court’s Family Branch Office as 2009Dhap2456, and the Plaintiff filed a counterclaim against the Plaintiff to seek divorce and the division of property (BB also 2009Dhap2463; hereinafter referred to as “the instant family lawsuit”). On July 26, 2012, the above court accepted the Plaintiff’s divorce claim and the Plaintiff’s claim for the division of property and the counterclaim against BB, and dismissed all of the Plaintiff’s claim for the remainder of consolation money and the division of property and the counterclaim against BB (see, e.g., evidence Nos. 31-4 and 16), and the above court also rejected the Plaintiff’s tax liability as the Plaintiff’s passive property and the Plaintiff’s claim for the division of property (see, e.g., Supreme Court Decision 201B., Supreme Court Decision 2016Da253610, Jun. 2, 201).

D. Judgment on the main claim

1) Determination on the assertion on the taxpayer of title trust property

A) Although the title of title trust property is owned by the trustee, the actual ownership of the title trust property is owned by the truster. Thus, if the truster transfers the trust property at his/her own will, he/she becomes a taxpayer of capital gains tax in a position to de facto control, manage, and dispose of the transfer income. However, if the trustee transferred the title trust property at his/her discretion without the delegation or consent of the truster, the transferor is not the trustee, but the truster is not in a position to de facto control, manage, and dispose of the transfer income unless the transfer income is returned to the truster, and thus, he/she cannot be deemed a taxpayer of capital gains tax (see, e.g., Supreme Court Decision 98Du7084, Nov. 26, 199).

B) As seen earlier, the instant real estate is the real estate title trust held by the Plaintiff as the actual owner of the instant real estate, that the Plaintiff purchased the instant real estate under the name of BB by bearing the funds. In light of the above legal principles, the taxpayer of the transfer income tax on the instant real estate is determined according to whether the Plaintiff, the title truster, sold the instant real estate at his own will or whether the title trustee sold the instant real estate without the Plaintiff’s delegation or consent.

In light of the following circumstances, it is reasonable to deem that the Plaintiff, a title truster, has sold the instant real estate according to the Plaintiff’s intent with prior consent or ratification at least after the conclusion of the instant sales contract, based on the following circumstances: (a) Party A’s evidence Nos. 6, 30, 31, 35, and 36; (b) Party B evidence Nos. 9, 12-1, 2, and 12-18; and (c) the testimony of the highest court of the trial witness of the trial at the trial at the trial; and (b) the testimony of the highest court of the trial at the trial at the trial at the trial at the trial.

(1) As seen earlier, the Plaintiff: (a) from around May 5, 2004 to around 2008 upon request of the Plaintiff’s 5 BBE-E’s disposal of real estate assets; (b) even during the so-called “OJ apartment located in the OB,” it appears that the Plaintiff was aware of the above 5 BBE’s disposal of real estate assets and 15.38% of the shares issued to the Plaintiff and 13.7% of the shares issued to the Plaintiff at the time of this case; and (c) the Plaintiff, as the Plaintiff did not appear to have been aware of the fact that the 200 OE-E’s disposal of real estate assets and 15.38% of the shares issued to the Plaintiff at the time of this case’s disposal of real estate assets and 15.7% of the shares issued to the Plaintiff at the time of this case’s disposal of real estate assets and the 200 POE-E’s disposal of real estate assets, were assigned to the 16.

(2) In addition, on July 3, 2007, the Plaintiff purchased OO 40-21, 40-23 land from KimM from OM and completed the registration of ownership transfer in the name of GoE on the same day. On November 3, 2008, the Plaintiff completed the registration of ownership transfer in the name of LJ as to each of the above lands and held title transfer in the name of LJ. In the instant family litigation case, the sale price of the above land was calculated as the Plaintiff’s active property (see the Decision 25 pages of the instant family litigation case).

(3) On April 5, 2010, the Plaintiff opposed that BB sold the instant real estate to the KimCC on June 22, 2007, which was less than the actual sale price at the time. However, after entering into the instant sales contract, the Plaintiff stated to the effect that CE is operating the gas station business with the instant sales price, etc., and in fact, this BB used a considerable portion of the instant sales price as the cost of constructing the gas station in consideration, as seen in paragraph (c).

Although the Plaintiff became aware of the sales of the instant real estate after the lapse of one week from the date the Plaintiff sold the instant real estate, the Plaintiff did not take such measures as actively resisting the instant sales contract and taking responsibility for the use, amount, etc. of the instant sales price to the BB and the E before becoming aware of the internal relationship between B and E.

B) Ultimately, the Plaintiff, a title truster, sold the instant real estate, which is a nominal trust property, at his own will, is liable to pay capital gains tax in the position of de facto controlling, managing, and disposing of the instant sales proceeds, and thus, the Plaintiff’s assertion contrary thereto is without merit.

C) Furthermore, in light of the following circumstances, it is reasonable to deem that a considerable portion of the sales price of this case was reverted to the Plaintiff and actually reverted to the Plaintiff, based on the overall purport of the pleadings, based on the evidence as seen earlier, evidence No. 5, evidence No. 20-2, and evidence No. 20-2 as to whether the sales price of this case actually belonged to the Plaintiff.

① As seen earlier, as long as the Plaintiff sold the instant real estate according to his/her will, it is reasonable to deem that the Plaintiff is liable for tax payment following the fact that the Plaintiff was in a position to de facto control, manage, and dispose of the capital gains accruing from the sale of the instant real estate. Even if, as alleged by the Plaintiff, the circumstances arise that the Plaintiff could not enjoy any profit by embezzlement of the instant sales proceeds after receiving the instant sales proceeds, such circumstances are attributable to the Plaintiff, and thus, are within the scope of risk that the title truster should assume within the scope of the authority to actually control, manage, and dispose of the instant real estate, and thus, it is difficult to deem that it affected the determination of whether capital gains actually accrue.

② The Plaintiff was living in flight at the time of entering into the instant real estate sales contract, and thus delegated the management of its property including the instant real estate to BB and E. Accordingly, it appears that the instant sales price was received through BB.

③ On June 22, 2007, an OOOO-O-O-O-O-O-O-O-O-O-O- of the purchase price of this case was transferred from the KO-B’s Agricultural Bank account (O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O- of the company substantially operated by the Plaintiff on June 29, 2007. It was recognized by objective financial data that the Plaintiff was investigated by a tax official on April 5, 2010, and it also recognized that the OO-O-O-O- of the purchase price of this case was used as the cost for the construction of

④ As seen earlier, on July 3, 2007, the Plaintiff purchased each part of the land located in the OO on the part of KimM, and entrusted the purchase price under the name of GoE (former JJ). The Plaintiff paid the price as OOO won out of the instant purchase price.

⑤ AB appears to have used some of the sales price of the instant case as living expenses, etc. necessary for communal living with the Plaintiff.

(6) Although the pertinent criminal case stated that this BB or CE invested part of the instant sales price in the name of BB, etc. in the relevant criminal case, and that some of the last holders of the checks paid out of the instant sales price through an order to submit financial transaction information have been revealed as BB, it is difficult to deem that the instant sales price was not repaid to the Plaintiff, and that there was no objective evidence to prove that the instant sales price was ultimately attributed to BB, and that there was no objective evidence to support that the instant sales price was ultimately attributed to the Plaintiff.

Therefore, the plaintiff's above assertion is without merit.

2) Judgment on the assertion on double tax investigation

After the Busan Regional Tax Office imposed capital gains tax on BB, the fact that on April 5, 2010, in order to investigate the legality of the disposition of capital gains tax on BB upon the objection filed on April 2, 2010, it conducted a reinvestigation as to whether to impose capital gains tax on B or Plaintiff upon the request of the Anti-Corruption and Civil Rights Commission for tax investigation, although it investigated the sale of the instant real estate against the Plaintiff on April 5, 2010, upon the request of the Anti-Corruption and Civil Rights Commission for tax investigation (hereinafter “instant investigation”).

However, according to Article 81-4 (2) 1 of the former Framework Act on National Taxes (amended by Act No. 11604, Jan. 1, 2013), "tax officials allow tax officials to conduct re-audit exceptionally in cases where there is evident evidence to acknowledge a suspicion of tax evasion," and "where there is evident evidence to prove a suspicion of tax evasion" refers to cases where tax evasion is acknowledged based on material to support objectivity and rationality of a considerable probability of confirming the occurrence of tax evasion (see, e.g., Supreme Court Decisions 2008Du10461, Dec. 23, 2010; 2008Du1146, May 26, 201).

Examining the following circumstances in the statement No. 3, which can be seen in light of the aforementioned facts and the purport of the entire pleadings, the instant investigation cannot be deemed as contrary to the principle of prohibition of duplicate investigation, which was conducted based on evident data that the Plaintiff was objectively objectively and reasonably aware of the omission of capital gains tax on the instant real estate.

① In the tax investigation against the Plaintiff on April 5, 2010, the Plaintiff stated to the effect that the instant real estate was the real estate title trusted by the Plaintiff to B, and that the Plaintiff consented after the sale of the instant real estate.

② Around February 2005, the EE drafted a statement to the effect that the EB directly paid the price to the E when purchasing OO-O-O-O-O-O9 and 14 parcels of the instant real estate from the KimCC, and that the price was the Plaintiff’s funds. The EB submitted the civil petition for grievance to the Anti-Corruption and Civil Rights Commission as reference materials when filing a civil petition for grievance.

③ The investigation of this case was conducted upon examining the complaints filed by the Anti-Corruption and Civil Rights Commission on April 5, 2010, based on the details of the investigation and the reference materials, and considering that the complaints filed by thisB were reasonable, the investigation of this case was conducted upon requesting the Busan District Tax Service to re-examine the disposition of capital gains tax.

Therefore, the plaintiff's above assertion is without merit.

E. Determination on the conjunctive claim

As seen earlier, although the title of title trust property is owned by the trustee, the actual ownership is owned by the truster. Thus, if the truster transfers the trust property by his/her own will, he/she is in a position to de facto control, manage, and dispose of the transfer income, and in cases where the truster arbitrarily transfers the title trust property without the delegation or consent of the truster, the truster becomes a taxpayer of the transfer income tax. However, in such cases, if the transfer income is returned to the truster, the truster becomes a taxpayer of the transfer income tax.

However, it is reasonable to deem that the Plaintiff, a title truster, consented to or ratified the instant sales contract in advance and sold the instant real estate, which is a trust property under his/her name, at his/her own will. As seen earlier, regardless of whether the instant sales proceeds have been returned to the Plaintiff, the Plaintiff, a title truster, is liable to pay capital gains tax as it is in the position to actually control, manage, and dispose of the instant sales proceeds, which are capital gains, regardless of whether or not the instant sales proceeds have been reverted to the Plaintiff. Therefore, the Plaintiff’s assertion seeking partial revocation of the instant disposition on the premise that the instant real estate was sold at will without the Plaintiff’s delegation or consent, and that only part of the instant sales proceeds have been returned to the Plaintiff is without any justifiable reason (B)’s assertion seeking partial revocation of the instant disposition without the need to further examine (B)

3. Conclusion

Therefore, the plaintiff's primary and conjunctive claims are all dismissed due to the lack of reason. The judgment of the court of first instance on the main claims of the plaintiff who shares the same conclusion is justifiable, and the plaintiff's appeal is dismissed, and the plaintiff's conjunctive claims added in the trial are dismissed. It is so decided as per Disposition.