Plaintiff 1 and three others (Law Firm Mailing, Attorney Park Byung-chul, Counsel for the plaintiff-appellant)

port of origin

April 3, 2013

1. All of the plaintiffs' claims are dismissed.

2. The costs of lawsuit are assessed against the plaintiffs.

The Defendant’s disposition of imposition of KRW 14,661,423,170 (including additional tax for unfaithful return 49,030,709, additional tax for unfaithful return 2,565,902,386) against the Plaintiffs on December 3, 2010 is revoked.

1. Details of the disposition;

A. On April 26, 2008, Nonparty 1, the owner of the land listed in the separate sheet (hereinafter “each of the instant lands”) concluded a sales contract with Nonparty 3 and Nonparty 4 with respect to each of the instant land and each of the instant land in Seoul, Gwangjin-gu, Seoul, with KRW 3.2 billion, but the buyer was unable to pay the purchase price, and the sales contract was terminated. Meanwhile, upon Nonparty 1’s death on June 21, 2008, the Plaintiffs, the children of Nonparty 1, assessed the instant land out of inherited property as KRW 3.2 billion, and reported the inheritance tax on February 22, 2008.

B. On December 7, 2010, on the ground that the sales price cannot be deemed as reflecting the adequate market price of each land of this case, the Defendant calculated the market price of each land of this case as the officially announced price in accordance with the supplementary evaluation method under the former Inheritance Tax and Gift Tax Act (amended by Act No. 8828, Dec. 31, 2007; hereinafter “Gift”) and assessed the market price of each land of this case as KRW 25,602,664,00 (per 26,493 won), and notified the Plaintiffs of correction and notification of KRW 14,61,423,170 of inheritance tax (hereinafter “instant disposition”). Although the Plaintiffs raised an objection on March 3, 201, the Plaintiffs was dismissed on March 29, 201, but the Tax Tribunal was dismissed on June 27, 2011, but was dismissed on March 1, 2011.

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, Eul evidence 1, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiffs' assertion

According to Article 60 of the Inheritance and Gift Tax Act and Article 49 of the Enforcement Decree of the Inheritance and Gift Tax Act, the value of the property on which the inheritance tax is levied shall be based on the market price as of the date of commencing the inheritance, and the market price accordingly shall be the value generally recognized as being established when transactions are made freely between many and unspecified persons. In the case of a fact of trading the relevant property during a period of not more than six months before or after the base date of appraisal, the transaction price shall be based on the transaction price if there is a fact of trading the relevant property within six months before or after the base date of appraisal. Accordingly, each land in the instant case

B. Relevant statutes

【Inheritance Tax and Gift Tax Act (amended by Act No. 8828 of Dec. 31, 2007)

Article 60 (General Rules, etc. of Appraisal)

(1) The value of property on which an inheritance tax or gift tax is levied under this Act shall be the market price as of the date the inheritance commences or the date of donation (hereinafter referred to as "date of appraisal"). In such cases, the value appraised by the method of appraisal stipulated in Article 63 (1) 1 (a) and (b) (excluding cases falling under the provisions of Article 63 (2)) shall be deemed the market

(2) The market price under the provisions of paragraph (1) shall be the price which is considered to be normal in cases of free transactions between many and unspecified persons and shall include the expropriation, public auction price, appraisal price, and others which are deemed to be the market price under the conditions

(3) In the application of the provisions of paragraph (1), where it is difficult to compute the market price, the assessed value shall be based on the methods prescribed in Articles 61 through 65 in consideration of the type, scale, transaction status, etc. of the relevant property.

Article 61 (Appraisal of Real Estate, etc.)

(1) Real estate shall be appraised by the following methods:

1. Land:

The officially assessed individual land price under the Public Notice of Values and Appraisal of Real Estate Act (hereinafter referred to as the "officially assessed individual land price"): Provided, That the value of the land for which no officially assessed individual land price exists shall be the amount appraised by the method as determined by the Presidential Decree in consideration of the officially assessed individual land price of neighboring similar land, and with respect to the land in the area prescribed by the Presidential Decree

(1) Enforcement Decree of the Inheritance Tax and Gift Tax Act (amended by Presidential Decree No. 21214, Dec. 31, 2008)

Article 49 (General Rules, etc. of Assessment)

(1) For the purpose of Article 60 (2) of the Act, the term "those recognized as the market price under the conditions as prescribed by the Presidential Decree, such as expropriation or public sale price, and appraised price, etc." means the price confirmed under one of the following subparagraphs in case of sale, appraisal, expropriation, auction (referring to an auction under the Civil Execution Act; hereafter the same shall apply in this paragraph) or public auction (hereafter referred to as "sale, etc." in this paragraph) during a period of not more than six months before and after the evaluation base date (three months in the case of donated property; hereafter referred to as the "evaluation period" in this paragraph): Provided, That even if there are sale, etc. during a period not falling under the evaluation period, if it is deemed that there are no special circumstances in view of price fluctuation in the company's management status, passage of time, surrounding environment, etc. during the period from the evaluation base date to the date falling under any subparagraph of paragraph (2), the relevant sale, etc. may be included in the price confirmed under one of the following subparagraphs

1. If there exists a fact of transaction of the relevant property, the transaction price: Provided, That the same shall not apply to cases where the transaction price is deemed objectively unfair, such as the transaction price with a person with a special relationship as provided in Article 26 (4);

(2) In applying the provisions of paragraph (1), whether the value under each subparagraph of paragraph (1) falls within 6 months before or after the standard date of appraisal (3 months in the case of donated property), shall be determined on the basis of the dates stipulated in the following subparagraphs, and where the value which is deemed the market price under the provisions of paragraph (1) is 2 or more, it shall be determined on the basis of the value falling under the nearest

1. For cases falling under paragraph (1) 1, the date of sales contract;

(c) Fact of recognition;

1) The non-party 1 also owned the land located near each of the instant lands in Gwangjin-gu Seoul Special Metropolitan City (No. 1 omitted) and (No. 2 omitted), but the said land was calculated on June 13, 2008 by calculating the amount of compensation of KRW 37,050 per square meter in relation to the project to create the Yongsansan Urban Natural Park. The said amount of compensation was included in the inherited property of the plaintiffs.

2) The contents of the sales contract concluded between Nonparty 1, Nonparty 3, and Nonparty 4 on April 26, 2008 are as follows.

The sale price is KRW 2.1 billion in total. 2) The sales price is KRW 3 billion in cash. The intermediate payment is paid KRW 3 billion in cash. 4) The remainder of the sale price is to be paid in cash within three (3) months from the contract date. 5) The buyer has provided real estate to a financial right or a third party within three (3) months from the contract date, and the seller pays the remainder of the sale price to the seller before offering documents. 3.1) The seller has to sell the sale price of real estate owned by the seller to KRW 1 billion in total. 3) The seller has to pay the seller the remainder of the sale price to the seller, and the seller has to pay KRW 1 billion in total to the seller. 3.0 billion in total, the seller is liable to cancel the sale price of real estate held by the buyer, and the seller has to pay the remainder of the sale price to Nonparty 1, 300 million in provisional registration (the remainder of the sale price of real estate held by Nonparty 5.3 billion in provisional registration).

3) In addition to the sales contract as of April 26, 2008, Nonparty 1 entered into a sales contract for each of the instant lands as of October 25, 2004, KRW 4.3 billion, KRW 4.7 billion on August 9, 2005, KRW 3.5 billion on August 23, 2006, KRW 6 billion on August 23, 2007, and KRW 3.2 billion on March 26, 2008, respectively, and the Plaintiffs entered into a sales contract for each of the instant lands as of March 1, 2009; and the Plaintiffs entered into a sales contract for each of the instant lands as of June 1, 2009, KRW 6 billion on June 9, 2009, KRW 6.5 billion on August 18, 2010, KRW 3.5 billion on October 3, 2015.

[Reasons for Recognition] Evidence and the purport of the whole pleading

D. Determination

However, the following circumstances revealed in the above facts, i.e., ① the sales contract concluded between Nonparty 1 and Nonparty 3 and Nonparty 4 on April 26, 2008 is settled only by the seller’s secured debt established on each of the lands of this case, and the remaining provisional registration and seizure are resolved by the buyer, and it is difficult to deem that the sale price is appropriate in terms of the objective value of each of the lands of this case. ② The Defendant calculated the market price of each of the lands of this case as the officially announced land value of 26,493 won, and determined the market price of each of the above lands at the time of the death of Nonparty 1, but the sale price of each of the above lands of this case cannot be determined as the market price for each of the above lands of this case, and the sale price of each of the above lands of this case cannot be determined as 3.7 billion won per 5 billion won per 200 million won per 3.7 billion won per 5 billion won per 37.5 billion won per 27.

3. Conclusion

Therefore, all of the plaintiffs' claims are dismissed. It is so decided as per Disposition.

[Attachment]

Judges Ansan-gu (Presiding Judge)