2015du38948 Revocation of Disposition of Imposing acquisition tax, etc.

A limited company specializing in error securitization for young children;

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Daejeon High Court (Cheongju) Decision 2014Nu5126 Decided January 28, 2015

September 24, 2015

The judgment of the court below is reversed, and the case is remanded to Daejeon High Court.

The grounds of appeal are examined.

1. Regarding ground of appeal No. 1

Articles 120(1)12 and 119(1)13 of the former Restriction of Special Taxation Act (amended by Act No. 10406, Dec. 27, 2010; hereinafter “former Special Provisions on Taxation”) provide that “Where a special purpose company acquires securitization assets from an asset holder or another special purpose company or manages, operates, and disposes of them in accordance with an asset-backed securitization plan, acquisition tax shall be reduced by 50/100 on real estate acquired by December 31, 2012.” However, Article 120(1)9 of the Restriction of Special Taxation Act (amended by Act No. 10406, Jan. 1, 201; hereinafter “Special Provisions on Special Provisions on Special Taxation”) provides that “acquisition tax shall be reduced by 0/100 on real estate acquired by the asset holder or another special purpose company by transfer from the asset-backed securitization plan.”

In light of the language and structure of the aforementioned provision, and the amended special provisions of the Act on the Special Cases of Taxation to a special purpose company in order to reasonably coordinate the scope of special taxation cases against a special purpose company and promote the equity of taxation with general creditors, real estate acquired by a special purpose company in the management, operation, and disposal of the acquired securitization assets excluding the acquisition tax reduction or exemption. In light of the above, the secured real estate acquired by a special purpose company by directly filing an application for purchase at the auction procedure of the secured real estate after the transfer of the secured real estate bonds, which are securitized assets, shall not be subject to the acquisition tax reduction or exemption pursuant to the amended special provisions.

The judgment below to the same purport is just, and contrary to the allegations in the grounds of appeal, there were no errors by misapprehending the legal principles on the interpretation of the amended special provisions.

2. Regarding ground of appeal No. 2

Based on its stated reasoning, the lower court determined that the Plaintiff could not be deemed to have acquired the instant real estate because the Plaintiff trusted that acquisition tax would be reduced or exempted in acquiring the instant real estate without any cause attributable to the Defendant’s public opinion statement. In light of the relevant legal principles and records, the lower court’s aforementioned determination is justifiable, and contrary to what is alleged in the grounds of appeal, there were no errors by misapprehending the legal doctrine on

3. Regarding ground of appeal No. 3

A. According to Article 2(1)15 and Article 55(1) of the Framework Act on Local Taxes and Article 36 of the Enforcement Decree of the Framework Act on Local Taxes, a local tax payment notice shall include the taxable year and items of the local tax to be paid, the provisions of the Act and municipal ordinances of the relevant local government, the taxpayer’s address and name, tax base amount, tax rate, amount of tax, deadline for payment, place for payment, measures to be taken in the event that the local tax is not paid by the due date for payment, and the method of remedying the illegality or mistake of the imposition. The above provisions purport to ensure fairness in tax administration by having the tax authority take a careful and reasonable disposition in accordance with the principle of no taxation without law, and at the same time, to provide the taxpayer with a detailed information about the details of the taxation disposition, and to provide the taxpayer with convenience in filing an appeal. As such, a tax notice shall specify property so that the taxpayer can know in detail the details of the taxation disposition, and shall specify the basis for calculation of the amount of tax to be imposed, tax base rate, and rate applicable, etc.

In addition, the defect of the duty payment notice is not cured even if the person liable for duty payment knows the basis of calculation or actually becomes aware of it (see, e.g., Supreme Court Decision 2001Du1543, Nov. 13, 2002).

On the other hand, if it is evident that a taxpayer was not affected by the determination of whether he/she is dissatisfied with the disposition or by the notice of tax notice sent by the tax authority prior to the disposition, the defect of the tax notice should be cured. However, the document that can supplement the defect of the tax notice should be delivered to the taxpayer prior to the notice of tax payment in accordance with the statutes, etc., so that it can be combined with the tax notice, and the necessary matters to be stated should be properly (see, e.g., Supreme Court Decision 2005Du5505, Mar. 13, 2005).

B. The reasoning of the judgment below and the evidence duly admitted by the court below revealed the following: ① The tax amount of acquisition tax, local education tax, and special rural development tax (hereinafter referred to as “acquisition tax, etc.”) and the tax base of acquisition tax are only stated in the instant tax payment notice, and the calculation basis of acquisition tax, etc. is not indicated properly; ② The notice of tax notice sent by the Defendant to the Plaintiff prior to the instant tax payment notice includes the acquisition tax, special rural development tax, and the tax base of acquisition tax, but the tax rate of acquisition tax

Examining these facts in light of the legal principles as seen earlier, the instant notice of tax payment of acquisition tax, etc. was partially omitted, and even if the Plaintiff had already known the acquisition tax rate and tax base at the time of reporting acquisition tax, etc., it cannot be deemed that the defect was corrected or cured. Thus, the instant disposition of tax payment of acquisition tax, etc. was unlawful.

Nevertheless, the lower court determined that the instant disposition of acquisition tax, etc. was lawful solely based on its stated reasoning. In so determining, the lower court erred by misapprehending the legal doctrine on the duty payment notice, thereby adversely affecting the conclusion of the judgment. The allegation contained in the grounds of appeal on

4. Conclusion

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 Park Sang-ok

Justices Lee Sang-hoon

Justices Kim Chang-tae, Counsel for the defendant

Justices Cho Jong-hee