1. On February 5, 2016, the Defendant jointly and severally liable for the imposition of gift tax on the Plaintiff.

Details of the disposition

On June 1982, the Plaintiff established a corporation for the purpose of the business of selling lecture pipes and piping parts, and the business of manufacturing lecture pipes (the trade name of April 25, 200 was changed to “stock company D”; hereinafter referred to as “D”) and operated the said corporation as its representative director.

On March 7, 1994, the Plaintiff established E Co., Ltd. (hereinafter “E”) by investing the total amount of KRW 50,000,000 capital ( KRW 10,000 per share of issued shares, KRW 5,000 per share of KRW 10,00), and registered E shares 2,530 (shares: 25.3%) as D’s business directors at the time of title trust to B and registered as B’s shareholders.

In the process of issuing new shares of E over 11 times, the Plaintiff received shares owned by the Plaintiff in the name of E and entered in the register of shareholders. As a result, as of March 17, 200, B acquired shares of E 244,300 (total shares 38.8%; hereinafter “instant merger agreement”).

On the other hand, D’s merger of E on November 18, 200, and the merger ratio [1(D):0.4(E)] was registered in the register of shareholders as B in the name of B in lieu of D’s shares allocated and delivered in the name of B pursuant to the merger ratio (0.4(E).

In addition, on May 28, 2005, the Plaintiff registered D’s shares 18,644 shares that were received through capital increase with new shares issued on June 4, 2005, and D’s shares 18,644 shares that were received through capital increase with new shares issued on June 4, 2005 (hereinafter “instant shares issued through capital increase with new shares”) in the name of each of the B’s shareholders registry.

As a result, the head of Busan Regional Tax Office having jurisdiction over the disposition of gift tax by the Defendant against the Plaintiff conducted an integrated investigation of D from January 7, 2016 to April 13, 2016 into corporate tax from 2011 to 2013, each of the instant shares is from the Plaintiff.