[1] The meaning of "land where no individual land exists" under Article 99 (1) 1 (a) of the former Income Tax Act and Article 164 (1) 3 of the former Enforcement Decree of the Income Tax Act

[2] The meaning of "the alteration of use of land" under Article 164 (1) 3 of the former Enforcement Decree of the Income Tax Act, and whether the actual use of land is changed due to the alteration of use of the building (affirmative)

[1] The phrase and purport of Article 99 (1) 1 (a) of the former Income Tax Act (amended by Act No. 7335 of Jan. 14, 2005) and Article 164 (1) 3 of the former Enforcement Decree of Income Tax Act (amended by Presidential Decree No. 18705 of Feb. 19, 2005) are delegated to the Enforcement Decree of the method of assessing the value of the land without a publicly assessed individual land price; in particular, if a publicly assessed individual land price is publicly announced as to a certain land, it cannot be deemed that the land without a publicly assessed individual land price is a land for the mere reason that the land category has been changed. In light of the above, even if the publicly notified individual land price as to the land before a land category has been publicly notified, the term "land without a publicly notified individual land price" as referred to in the above provision means the land at issue where the land category has changed due to a change in the publicly notified individual land price as a basic material for calculating the publicly assessed individual land price under the intellectual Act and it is unreasonable.

[2] Article 2 subparagraph 7 of the Cadastral Act provides that "the term "land category" means a registration by classifying the kinds of land according to the main purpose of the land and by classifying it in the cadastral record. Thus, the main purpose of the land related to the land category in the Cadastral Act refers to the actual state of use of the land which is the cause of the land category classification, and it does not necessarily involve a change of land category in the intellectual law as a matter of course due to the change of various special-purpose areas, special-purpose districts, or special-purpose zones as provided by the National Land Planning and Utilization Act, and it is not accompanied by a change of land category in the intellectual law. In light of the above, it is reasonable to view that the "use change of land" in Article 164 (1) 3 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 18705 of Feb. 19, 2005) refers to a change of land use, which is the basis of land category classification in the intellectual law

[1] Article 9 (1) 1 (a) of the former Income Tax Act (amended by Act No. 7335 of Jan. 14, 2005); Article 164 (1) 3 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 18705 of Feb. 19, 2005) / [2] Article 164 (1) 3 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 18705 of Feb. 19, 2005); Article 2 subparagraph 7 of the Cadastral Act

Plaintiff et al.

Head of Suwon Tax Office

Busan High Court Decision 2006Nu3766 decided May 18, 2007

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

The grounds of appeal are examined.

Article 99 (1) 1 (a) of the former Income Tax Act (amended by Act No. 7335 of Jan. 14, 2005; hereinafter “the Act”) provides that “The standard market price of land shall be the officially assessed individual land price under the Act on the Public Announcement of Land Prices and Evaluation of Land, etc.: Provided, That the value of land for which no officially assessed individual land price exists shall be the amount appraised by such a method as determined by the Presidential Decree in consideration of the officially assessed individual land price of neighboring similar land in the vicinity of the place of tax payment,” and Article 164 (1) (a) of the former Enforcement Decree of the Income Tax Act (amended by the Presidential Decree No. 18705 of Feb. 19, 2005; hereinafter “Enforcement Decree”) provides that “the amount appraised by such method as determined by the Presidential Decree” in the proviso of Article 99 (1) 1 (a) of the Act refers to the value of land which has no officially assessed individual land price falling under any of the following subparagraphs and its change in the form and quality of land under Article 10 (2).”

In light of the language and purport of the above provision, in particular, Article 99(1)1(a) of the Act delegates the method of assessing the value of the land without a publicly assessed individual land price to the Enforcement Decree for the assessment of the value of the land without a publicly assessed individual land price, and if a publicly assessed individual land price is publicly announced, it cannot be deemed that the land does not constitute a land without a publicly assessed individual land price for the mere reason that the land category has been altered under the cadastral law. In light of the above, “land without a publicly assessed individual land price” as referred to in Article 99(1)1(a) and Article 164(1)3 of the Enforcement Decree of the Act refers to the land in a case where, even if a publicly notified individual land price for the land before a land category has been publicly announced due to a land category change, it is unreasonable to regard the land as the basic data for calculating the publicly assessed individual

On the other hand, Article 2 subparagraph 7 of the Cadastral Act provides that "land category means a registration by classifying the kinds of land according to the main purpose of the land and in the cadastral record." In light of the fact that the main purpose of the land use related to the land category in the Cadastral Act refers to the actual state of use of the land which is the cause of the land category classification, and that the change of land category in various specific-use areas, specific-use districts, and specific-use districts (hereinafter "specific-use area, etc.") as provided by the National Land Planning and Utilization Act is not necessarily accompanied by the change of land category in the cadastral law, the term "use change of land" in Article 164 (1) 3 of the Enforcement Decree refers not to the change of specific-use area, etc., but to the change of actual state of use of the land which is the basis of land classification in the Cadastral Act. Here, the change of use of the land

Nevertheless, the court below did not review and determine at all the above "special circumstances" as to the "land, the land category of which has changed due to the change of the purpose of use of a building" under Article 164 (1) 3 of the Enforcement Decree, and "land, the land category of which has changed due to the change of the purpose of use of a building" does not constitute "land without individual publicly notified land" on the ground that the land category change due to the change of the purpose of use of a building is due to the new construction of Class 1 neighborhood living facilities after the removal of a gas station. In so doing, the court below erred by interpreting and applying the proviso of Article 99 (1) 1 (a) of the Act, Article 164 (1) 3 of the Enforcement Decree of the Building Act, in that it erred by interpreting and applying the interpretation and application of Article 164 (1) 1 (a) of the Act, Article 164 (1) 3 of the Enforcement Decree of the Building Act (in addition, the change of purpose of use of a building under the Building Act is to change of the use of a new building.

Therefore, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Cha Han-sung (Presiding Justice)