Whether the proviso of Article 170(1) of the Enforcement Decree of the Income Tax Act (Presidential Decree No. 10977 of December 31, 1982) is null and void.

The proviso of Article 170 (1) of the Enforcement Decree of the Income Tax Act (the Presidential Decree No. 10977 of Dec. 31, 1982) shall not be deemed to be a invalid provision against the spirit of Article 23 (4) and Article 45 (1) 1 of the Income Tax Act (the Income Tax Act, Law No. 3576 of Dec. 21, 1982) or the spirit of Article 18 (1) of the Framework Act on National Taxes.

Articles 23(4) and 45(1)1 of the Income Tax Act (Act No. 2576 of Dec. 21, 1982), Article 170(1) of the Enforcement Decree of the Income Tax Act (Presidential Decree No. 10977 of Dec. 31, 1982), Article 18(1) of the Framework Act on National Taxes

Supreme Court Decision 85Nu281 Decided July 8, 1986, Supreme Court Decision 86Nu596 Decided December 23, 1986, Supreme Court Decision 87Nu93 Decided May 12, 1987

Attorney Jeon Jong-gu, Counsel for the defendant-appellant

Head of Jeju Tax Office

Gwangju High Court Decision 86Gu83 delivered on March 5, 1987

The appeal is dismissed.

The costs of appeal shall be borne by the plaintiff.

We examine the grounds of appeal.

(1) On the first ground for appeal

Article 170 (1) of the Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 10977, Dec. 31, 1982) provides that "in determining capital gains on transfer provided for in Article 23 (2) of the Act, either of the transfer values or acquisition values shall be determined based on the actual market price, and one of the other shall be determined based on the standard market price if one of the actual market price is determined based on the amount." However, in the case of subparagraphs 1 and 2 of paragraph (4), if it is impossible to confirm one of the transfer values or acquisition values, it shall be confirmed based on the actual market price and it shall be determined based on the standard market price under Article 115 (1) 1 (c) of the Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 10977; Presidential Decree No. 10977); the above proviso provision is inconsistent with the judgment of the defendant's Supreme Court Decision 97Nu18781, Dec. 18, 2008>

(2) On the second and third grounds:

According to the reasoning of the judgment below, the court below determined that the plaintiff purchased the real estate of this case on April 11, 1984 and completed the registration of transfer of ownership by selling 65,300,000 won to Han Han-ro Co., Ltd. on April 23, 1985, and completed the registration of transfer of ownership pursuant to Article 170 (4) 1 of the Enforcement Decree of the Income Tax Act. However, the above transaction is a transaction with a juristic person under Article 170 (4) 1 of the Enforcement Decree of the Income Tax Act and its actual transfer value is confirmed, but the actual transfer value is not confirmed, and it is not possible to confirm the acquisition value. The court below's determination is just in the misapprehension of the legal principles as to the above disposition of transfer income tax, 170 (1) proviso of the Enforcement Decree of the same Act, Article 115 (1) 1 (c) of the Enforcement Decree of the same Act, and Article 56-5 (5) 1 of the Enforcement Rule of the same Act.

(3) On the fourth ground:

Articles 23(4) and 45(1)1 of the Income Tax Act provide that the transfer value and acquisition value, which form the basis for calculating gains on transfer, shall, in principle, be based on the standard market price at the time of transfer and acquisition of transferred assets, but in cases prescribed by Presidential Decree, it shall be based on the actual transaction value of the assets. Article 170(4)3 of the Enforcement Decree of the same Act enacted upon delegation, provides that "Where the actual transaction value at the time of transfer and acquisition can be confirmed by documentary evidence submitted by the transferor at the time of the transfer or final return on transfer," one of the cases where the transfer and acquisition value can be acknowledged by the actual transaction value. In light of the purport of the above provision, the transferor may submit documentary evidence of transfer and acquisition to the tax authority until the time of the final return on transfer and acquisition, and the period of the final return on transfer is from May 1, 1986 to May 31, 199, even if the actual acquisition value cannot be confirmed by the said real transaction value, it cannot be confirmed by the actual acquisition value.

The decision of the Committee on the same purport is just, and it cannot be said that there was an error of misapprehending the legal principles or violating the precedents such as the theory of the lawsuit.

(4) Therefore, the appeal is dismissed, and the costs of the appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Yoon Yoon-hee (Presiding Justice)