In case where a third party (new house construction businessman), other than the owner of the land, constructs a new house within 3 years from the date of cancellation of the prohibition or restriction on the use pursuant to Acts and subordinate statutes, whether it constitutes idle land under the Land Excess Profit Tax Act excluded from the special deduction for long-term holding

Article 23 (2) 2 of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994) and the main sentence of Article 46-3 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 1467 of Dec. 31, 1994) exclude the site from the special long-term holding deduction. Although the special long-term holding deduction is intended to induce long-term holding of real estate, if the site is long-term holding, it would hinder efficient use of the land and would not allow the special long-term holding deduction. Thus, in light of the legal principle that if a building is on the land, regardless of who is the owner of the building, it cannot be deemed the site, and in light of the fact that the land excess profit tax is limited to the land which is non-use of the land subject to taxation, the land excess profit tax should not be construed to exclude the remaining land from the newly constructed land owner other than the land owner under Article 32 of the former Enforcement Decree of the same Act.

Article 23 (2) 2 of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994) (see current Article 95 (2)), Article 46-3 (see current Article 161) of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 14467 of Dec. 31, 1994), Article 8 (3) of the former Land Excess Gains Tax Act (amended by Act No. 5108 of Dec. 295), Article 23 subparagraph 3 (b) of the former Enforcement Decree of the Land Excess Gains Tax Act (amended by Presidential Decree No. 15194 of Dec. 31, 1996)

Supreme Court Decision 92Nu4291 delivered on June 26, 1992 (Gong1992, 2313) Supreme Court Decision 92Nu19613 delivered on July 27, 1993 (Gong1993Ha, 2453) Supreme Court Decision 93Nu12749 delivered on October 26, 1993 (Gong193Ha, 3195)

Plaintiff

Head of Daegu Tax Office

Daegu High Court Decision 97Gu1373 delivered on August 29, 1997

The appeal is dismissed. The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

According to the reasoning of the judgment below, the court below determined that the plaintiff acquired the land of this case on January 30, 1978, and received the remaining price on February 9, 1995 after selling it to the non-party corporation corporation (hereinafter "non-party corporation") on March 24, 1994. Meanwhile, the land of this case was designated and publicly announced as trucking facility site under the Daegu Urban Planning Act on June 29, 1979, and its use was revoked on September 17, 1993. The non-party corporation, the transferee of this case, started construction on the land of this case on August 16, 1994, and it was not subject to construction on the land of this case under the proviso of Article 2 of the former Enforcement Decree of the Income Tax Act (amended by Act No. 1935, Feb. 9, 195; Presidential Decree No. 1984, Feb. 9, 199>

The reason why a special long-term holding deduction is excluded from the special long-term holding deduction under Article 23 (2) 2 of the former Income Tax Act and the main sentence of Article 46-3 of the Enforcement Decree of the same Act is that if a long-term holding deduction is intended to induce a long-term holding of real estate, it would interfere with efficient utilization of the national land, thereby not allowing the special long-term holding deduction. Therefore, if a building is on land, regardless of who is the owner of the building, it shall not be deemed that the land is a site (see, e.g., Supreme Court Decisions 92Nu4291, Jun. 26, 1992; 92Nu19613, Jul. 27, 1993; 93Nu12749, Oct. 26, 1993; 203Nu32749, etc.). Therefore, in light of the legal principles that a transferee of the above land should not be construed to be the land under Article 3 (2) of the former Enforcement Decree.

The judgment of the court below to the same purport is just, and there is no error in the misapprehension of legal principles as to idle land under the Land Excess Profit Tax Act, which is excluded from the special deduction for long-term holding, and the precedents of party members cited in the ground of appeal are inappropriate to be invoked in this case, with different cases. There is no ground for appeal.

Therefore, the appeal is dismissed and all costs of 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 Final Young-young (Presiding Justice)