[1] The case holding that real estate rental business of a foreign investing company shall not be included in the corporation's unique business even if it falls under the case where it is not necessary to obtain business

[2] The reference point for determining whether a corporation constitutes non-business land under Article 84-4 (1) of the former Enforcement Decree of the Local Tax Act

[3] The starting date of the exclusion period for the imposition of acquisition tax on non-business land which satisfies the taxation requirement due to the lapse of a certain grace period

[1] The case holding that even if the sales from real estate rental business of a foreign investing company fall short of 1% of the sales from the original authorized business and it is not necessary to obtain a prior business license, the real estate rental business shall not be included in its unique business as authorized and permitted by an administrative agency under Article 84-4 (2) 3 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 15211 of December 31, 1996)

[2] The issue of whether a corporation constitutes non-business land under Article 84-4 (1) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 15211 of Dec. 31, 1996) shall be determined at the time when the prescribed grace period expires. Thus, part of the land acquired by the corporation shall not be deemed as non-business land on the ground that it was temporarily used for its unique business within the grace period.

[3] In cases where a corporation becomes a land for non-business use as it does not directly use the land for its unique business within a certain grace period from the date of acquiring the land, the acquisition tax imposed and paid within 30 days from the expiration date of the grace period, and the exclusion period of the imposition of acquisition tax is in progress

[1] Article 112 (2) of the Local Tax Act, Article 84-4 (2) 3 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 15211 of Dec. 31, 1996) / [2] Article 112 (2) of the Local Tax Act, Article 84-4 (1) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 15211 of Dec. 31, 1996) / [3] Article 30-2 (1) of the former Local Tax Act (amended by Presidential Decree No. 4794 of Dec. 22, 1994) (refer to Article 30-4 (1) of the current Local Tax Act), Article 86-3 (1) 1 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14041 of Dec. 31, 193)

[2] Supreme Court Decision 90Nu7050 decided Feb. 26, 1991 (Gong1991, 1116) Supreme Court Decision 92Nu978 decided Jul. 24, 1992 (Gong192, 2585)

Sam Young Electronic Industry Co., Ltd. (Attorney Park Jung-hee, Counsel for the plaintiff-appellant)

Sungnam City

Seoul High Court Decision 94Gu25270 delivered on August 21, 1996

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

We examine the grounds of appeal.

A. On the first and second grounds for appeal

Article 84-4 (1) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 1303 of Jun. 29, 190) provides that the land which is not used for its unique business within the grace period from the date of its acquisition shall be determined as non-business land subject to the imposition of acquisition tax without justifiable grounds, and Article 84-4 (3) of the same Act provides that the land is deemed non-business land, notwithstanding the provisions of paragraph (1) of the same Article. Thus, when the defendant first and second disposals are conducted, 454,272,820 won of acquisition tax calculated by deeming that part of the land of this case falls under non-business land under Article 84-4 (3) 1 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 13033 of Jun. 29, 190) shall not be deemed to be in violation of the principle of trust and good faith and thus, it shall not be deemed to be erroneous in the judgment below.

In addition, the argument that the disposition of this case was made without investigating the actual use of the land and that it was illegal in violation of the current status imposition principle under Article 77 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14041 of Dec. 31, 1993) is a new argument that is not alleged in the original decision, and thus, it cannot be a legitimate ground for appeal. All arguments are without merit.

B. On the third ground for appeal

Article 84-4 (2) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 15211 of Dec. 31, 1996) provides that "the unique business of a corporation" refers to the following business, and subparagraph 3 provides that "the business of a foreign-invested enterprise is authorized or permitted by an administrative agency." Article 13 (2) of the former Foreign Capital Inducement Act (amended by Presidential Decree No. 4316 of Jan. 14, 191), Article 11 (5) 1 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 1317 of Feb. 27, 1991), Article 8 (2) of the Enforcement Rule of the same Act (amended by Presidential Decree No. 1843 of Feb. 27, 1991) provides that "the unique business of a corporation" refers to the business of the following subparagraphs, and it does not require prior permission from an administrative agency.

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 the corporation's unique duties, such as the theory of lawsuit, or incomplete deliberation.

In addition, the issue of whether the land constitutes land for non-business use of a corporation under Article 84-4 (1) of the Enforcement Decree of the Local Tax Act is determined as of the time when the prescribed grace period has expired (see, e.g., Supreme Court Decisions 90Nu7050, Feb. 26, 1991; 92Nu978, Jul. 24, 1992); therefore, there is no reason to further examine whether part of the land of this case is a land for non-business use because it was temporarily used for its unique duties within the grace period.

C. On the fourth ground for appeal

Article 30-2 (1) of the former Local Tax Act (amended by Act No. 4794 of Dec. 22, 1994; hereinafter the same shall apply) provides that no local tax shall be imposed if it is not exercised for five years from the date on which it is assessable. Article 120 provides that acquisition tax shall be voluntarily filed and paid within 30 days from the date on which it is assessable; and Article 121 provides that where a taxable object is subject to heavy taxation under Article 112 (2) after its acquisition, voluntary return and payment shall be made within 30 days from the date on which it is prescribed by the Presidential Decree; Article 121 provides that where a person liable to pay acquisition tax fails to pay it by self-return under Article 120 above, the calculated tax amount shall be collected by adding 20/100 to the calculated tax amount; Article 86-3 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 14041 of Dec. 31, 193) provides that "land for nonbusiness purpose" as provided in the proviso of Article 1.

In full view of the provisions of the relevant Acts and subordinate statutes, when a corporation's land becomes non-business land as it fails to use directly for its unique duties within a certain grace period from the date of its acquisition, the acquisition tax subject to the imposition of acquisition tax shall be paid within 30 days from the expiration date of the grace period. As such, the exclusion period for the imposition of acquisition tax shall run from the day following the expiration date of the payment period. As such, the day following the expiration date of the payment period for acquisition tax based on the acquisition date, such as the theory of lawsuit, shall not be deemed the initial date of the exclusion period. Therefore, there is no reason to hold any error

Therefore, the appeal is dismissed and the costs of appeal are assessed against the losing plaintiff. It is so decided as per Disposition by the assent of all participating Justices.

Justices Kim Jong-sik (Presiding Justice)