Whether the appraisal value of unlisted stocks according to the standards for the analysis of securities can be deemed as the market price under the Inheritance Tax Act.

The criteria for the analysis of securities are based on the provisions on the securities underwriting business, and these provisions are mainly set the criteria necessary for securities companies to take over securities, so they are not only provisions on the stock evaluation at the time of the company disclosure or the increase of stock of listed companies, but also provisions on the stock evaluation at the time of the company's capital increase. The evaluation of the stock value according to the above criteria is based on the interests of the underwriters or investors, and thus there is a tendency to be evaluated lower than the market price, and it can be viewed as the market price as

Article 9(1) of the former Inheritance Tax Act (amended by Act No. 4283 of Dec. 31, 1990); Article 5(1) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 13196 of Dec. 31, 1990)

[Judgment of the court below]

The Head of the Maternization Tax Office

Seoul High Court Decision 92Gu5739 delivered on July 15, 1993

The judgment below is reversed;

The case is remanded to Seoul High Court.

We examine the grounds of appeal.

According to the reasoning of the judgment below, the court below, based on the evidence adopted by the plaintiff on October 30, 1989 that the non-party 2 was donated 8,280 shares of the non-party 1 corporation (hereinafter "non-party 2") to the non-party 3 corporation on the market price of the non-party 4 (the non-party 3 corporation). The defendant calculated the value of the non-party 1's shares according to the supplementary valuation method under Article 5 (5) 1 (b) of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 13196 of Dec. 31, 190), and determined that the non-party 2, the non-party 3 corporation's share value of the non-party 1's shares, which is the market price of the above non-party 4's shares, was not the market price of the non-party 1's shares at an objective market price of the non-party 1's shares at the above market price of the non-party 1's shares.

Article 9(1) of the former Inheritance Tax Act and Article 5(1) of the Enforcement Decree of the same Act mean, in principle, an objective exchange price formed through free and normal transactions between many and unspecified persons. However, since the concept includes the value appraised in an objective and reasonable manner, it is justifiable to determine that even if it is non-listed stocks, if there is a reliable appraisal institution’s appraisal value reflecting the objective exchange value appropriately, it may be deemed as the market price.

However, according to the records, the price recognized by the court below as the market price which reflects the objective exchange value of the stocks of this case appropriately is based on the opinion table (No. 37 evidence No. 1,2) appraised by the court in the case related to Korea New Securities Co., Ltd. according to the appraisal entrustment by the court. The appraisal standard is based on the provisions on securities acquisition business, and these standards are mainly set standards necessary for securities companies to take over securities, so they are not only regulations on the appraisal of stocks at the time of public offering or increase of capital of listed companies, but also regulations on appraisal of stocks at the time of public offering or increase of capital of listed companies as well as regulations on appraisal of stocks at the time of public offering or increase of capital of listed companies. Since the appraisal value according to the above standards has a tendency to lower the appraisal value than the market price so that it can be seen as the market price at the time of appraisal by an objective and reasonable method under the Inheritance Tax Act. On the other hand, even if the appraisal standard is based on the securities analysis, the above standards are not more than the market price of the same business type.

Therefore, since the market price cannot be deemed to be the market price that reflects the objective exchange value of the stock in this case, the price of the stock in this case should be calculated by the supplementary evaluation method as stipulated in Article 5 (5) 1 (b) of the former Enforcement Decree of the Inheritance Tax Act, even though the court below considered the appraisal value based on the above appraisal to be the market price that properly reflects the objective exchange value of the stock in this case and calculated the price accordingly, it affected the conclusion of the judgment by misapprehending the legal principles as to the appraisal value of unlisted stocks. The grounds for appeal assigning this error are with merit.

Therefore, the judgment below is reversed, and the case is remanded to the court below. It is so decided as per Disposition by the assent of all participating Justices.

Justices Park Jong-ho (Presiding Justice)