[1] Whether the application of the provision on deemed donation under Article 34-2(1) of the former Inheritance Tax Act may be excluded in a case where a foundation established a school foundation and received a transfer from the school foundation in order to preserve the actual state of land contributed as part of the site of a middle and high school as a result of the school’s transfer (negative)

[2] Whether the value of the property contributed to the public service is excluded from the taxable value subject to gift tax if there is no intention to change the father while avoiding the burden of gift tax even if the public service operated by a corporation with a special relationship with the public service is a director (negative)

[3] Whether the use after the transfer should be considered in calculating the market price of the transferred property, which is the basis for calculating the gift value (negative)

[1] Article 34-2 (1) of the former Inheritance Tax Act (amended by Act No. 4662 of Dec. 31, 1993) provides that in case where a property is transferred to a related party prescribed by the Presidential Decree as consideration for significantly low value except for the cases falling under Article 34, the transferor of the property shall be deemed to have donated an amount equivalent to the difference between the price and the market price thereof to the person who takes over the property at the time of transferring the property, and the transfer circumstance shall not be taken into consideration. Thus, the application of the above provision on deeming donation shall not be ruled out on the ground that the incorporated foundation, while establishing the school juristic person, has transferred the land contributed as part of the site of a middle and high school to preserve the sedity of the premises.

[2] Article 8-2 (1) 1 of the former Inheritance Tax Act (amended by Act No. 4662 of Dec. 31, 1993) which applies mutatis mutandis to gift tax pursuant to Article 34-7 of the same Act and Article 3-2 (1) 1 of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 14082 of Dec. 31, 1993) provides that the value of the property contributed to public works should not be included in the taxable value of donated property. Thus, even if the value of the property contributed to public works falls under the property contributed to public works, so long as a person having a special relation with the pertinent public works is included in the property contributed to public works, the value of donated property cannot be excluded from the taxable value of donated property, and it is not necessary to consider whether there is an intention to change the part in the manner of avoiding the burden of gift tax.

[3] In light of Article 34-2(1) of the former Inheritance Tax Act (amended by Act No. 4662 of Dec. 31, 1993) and Article 41(1) of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 14082 of Dec. 31, 1993), the market value of the transferred property, which serves as the basis for calculating the donation value, shall be assessed based on the current status at the time of transfer, and there is no ground to view that the market value should be assessed in consideration of the use after the transfer.

[1] Article 34-2 (1) of the former Inheritance Tax Act (amended by Act No. 4662 of Dec. 31, 1993) (see current Article 35 (1) of the Inheritance Tax and Gift Tax Act) / [2] Article 34-7 (see current Article 48 (1) of the Inheritance Tax and Gift Tax Act) of the former Inheritance Tax Act (amended by Act No. 4662 of Dec. 31, 1993), Article 3-2 (1) 1 (see current Article 48 (2) 5 of the Inheritance Tax and Gift Tax Act) of the former Inheritance Tax Act (amended by Presidential Decree No. 14082 of Dec. 31, 1993) / [3] Article 34-2 (1) (see current Article 35 (1) of the Inheritance Tax and Gift Tax Act) of the former Inheritance Tax Act (amended by Act No. 4662 of Dec. 31, 193) (see current Article 1314 (1) of the Inheritance Tax Act)

Jeoncheon-gu District Court Decision 201Na1448 delivered on May 2, 201

The Director of the North Korean Tax Office

Gwangju High Court Decision 96Gu2629 delivered on December 17, 1998

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

The grounds of appeal are examined.

1. On the first ground for appeal

According to the records, the decision of the court below that the plaintiff's acquisition of the land and building of this case did not follow an exchange contract with the non-party Dongdong Industrial Co., Ltd. (hereinafter referred to as "Dongdong Industrial Co., Ltd.") but was based on the sales contract of February 26, 1992 with the non-party educational foundation Maritime Institute of Maritime Affairs (hereinafter referred to as "Masung"), the owner of the land and building of this case, is just and there is no illegality such as incomplete deliberation and violation of the rules of evidence

However, the court below erred in rejecting Gap evidence No. 14 as the exchange contract between the plaintiff and the Dong country industry on August 19, 191 on the land of this case since it constitutes a disposal document without any reasonable reasons. However, since the above written contract does not interfere with the court below's fact-finding, it cannot be said that the above erroneous judgment of the court below affected the conclusion of the judgment. There is no reason to argue.

2. On the second ground for appeal

Article 34-2 (1) of the former Inheritance Tax Act (amended by Act No. 4662 of Dec. 31, 1993; hereinafter the same) provides that, except for cases falling under Article 34 of the same Act, in cases where the property is transferred to a related party prescribed by the Presidential Decree as consideration for the value significantly low, the transferor of the property shall be deemed to have donated an amount equivalent to the difference between the price thereof and the market price thereof to the person who takes over the property at the time of transferring the property, and the transfer circumstance is not considered. Thus, the land of this case, like the theory of the lawsuit, is deemed to have been contributed by the Plaintiff as part of the site of the piracy, while the Plaintiff established the Maritime Institute and transferred the land to the above school, the application of the above provision of the Maritime Institute shall not be excluded in light of such circumstances.

The decision of the court below to the same purport is just, and there is no error in the misapprehension of the legal principles as to the provision of the above donation as the theory of lawsuit.

3. On the third ground for appeal

Article 8-2 (1) 1 of the former Inheritance Tax Act and Article 3-2 (1) 1 of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 14082, Dec. 31, 1993; hereinafter the same) which applies mutatis mutandis to the gift tax pursuant to Article 34-7 of the former Inheritance Tax Act provide that the value of the property contributed to the public works should not be a public works operated by a corporation with special relation to the public works in order to be excluded from the subject of the taxable value of the gift tax. Thus, even if the value of the gift in this case constitutes the property contributed to the public works, as determined by the court below, the value of the gift in this case should not be excluded from the subject of the taxable value of the gift tax, i.e., the person having special relation with the public works among the directors of the plaintiff corporation, as long as the employee of the Maritime Institute is included in the subject of the gift tax. It is not necessary to consider whether the plaintiff or the Maritime Institute had intention

In conclusion, the judgment of the court below is just, and it is not erroneous in the misapprehension of legal principles as to the object to be excluded from the taxable value such as theory of lawsuit. There is no ground for discussion.

4. On the fourth ground for appeal

In light of the provisions of Article 34-2(1) of the former Inheritance Tax Act and Article 41(1) of the former Enforcement Decree of the Inheritance Tax Act, the market price of the transferred property, which serves as the basis for calculating the gift value, should be assessed based on the current status at the time of transfer. Thus, the market price of the land of this case should be assessed based on the current status at the time of transfer by the Plaintiff. In addition, even if the Plaintiff acquired the land of this case for the purpose of using it as the place for transferring the land of this case, such market

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 calculation of the taxable value, such as the theory of lawsuit.

5. 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 Seo Sung-sung (Presiding Justice)